Nifty Metal sheds 9%, Hind Zinc 20% in 2 days; what should investors do?

Drumil Vithalani, technical analyst at Bonanza decodes trading strategy in Nifty Metal, as the index slumps over 9 per cent in two trading sessions.

The Nifty Metal index has slumped up to 9 per cent in the last two trading sessions amid increased volatility in base metal prices. Analysts also attributed the dip in prices to profit-taking given the sharp preceding rally.  The Nifty Metal index outperformed the NSE benchmark Nifty 50 both on its way up and then down. In the last two days, the Nifty Metal index sank 9 per cent, while the Nifty 50 was down 2.3 per cent since January 29.  In the preceding period of January, the Nifty Metal index had rallied 11.7 per cent, while the Nifty declined 2.7 per cent.  Among individual stocks, in the recent fall, Hindustan Copper and Hindustan Zinc were the worst hit, down up to 21 per cent and 20 per cent, respectively. That apart, National Aluminium Company (Nalco), Vedanta, Hindalco Industries and Tata Steel dropped in the range of 8 - 17 per cent.  Given the recent downturn, here's a trading strategy in Nifty Metal as recommended by Drumil Vithlani, Technical Analyst at Bonanza. 

Nifty Metal

Current Levels: 11,380  Technical chart shows that the Nifty Metal index has dropped below its short-term 20-day  exponential moving average (20-DEMA) for the first time since December 12, 2025. The 20-DEMA stands at 11,524, and is now expected to act as a near term hurdle, says Drumil Vithlani of Bonanza. 

 

  The analyst recommends that the short-term outlook seems side-ways to mildly negative as the index quotes below its recent swing high and the 20-DEMA. The index has near support around 11,250, below which the index can fall to 10,900 levels, says Vithlani.  The analyst, however, believes that the overall structure remains bullish, and any dip towards 10,900-10,800 can provide a good buying opportunity with a medium-term perspective.  Among individual stocks, Vithlani remains bullish on Hindustan Zinc from the metal pack, and expects to stock to revist its recent highs.  

Hindustan Zinc

Current Market Price: ₹582 

  "Hindustan Zinc has support around ₹585 - ₹560 zone on the weekly chart, from where it can revisit levels of ₹650 in the next one month or so," says Vithlani.

  Disclaimer: The views expressed by the brokerage/ analyst in this article are their own and not those of the website or its management. Business Standard advises users to check with certified experts before taking any investment decisions.