Nifty Midcap down nearly 7% from peak, tests 200-DMA; what chart says?

Amid the downturn, the Nifty Midcap 100 tested its 200-DMA after a gap of five months; presently 58 index constituents traded below the long-term average on the daily charts.

Disclaimer: Views and outlook shared belong to the respective brokerages/analysts and are not endorsed by Business Standard. Readers' discretion is advised. The Nifty Midcap 100 index slipped nearly 7 per cent in the last three weeks amid the current market correction. In comparison, the Nifty 50 and the Nifty Smallcap 100 declined 5.2 per cent and 5.7 per cent in the same period. According to NSE data, the Nifty Midcap index plunged 6.6 per cent from its record high of 64,451 hit on August 26 to an intra-day low of 60,189 on September 16. In the process, the index also tested its 200-day moving average (200-DMA), which stands at 60,382. The daily chart shows that the index tested its long-term average after a gap of five months. Analyst reckons that the overall structure of the Midcap index remains favourable, with key support seen around the 60,000-mark. On Thursday, the Nifty Midcap index gained 0.9 per cent and quoted around 61,400 levels.  Ved Anil Gawkar, CMT, technical research analyst at Almondz Financial Services highlights that the Midcap index has been forming higher-highs and higher-lows on the daily chart since the breakout in early June 2026. 

 

 "The Midcap index may form a higher base around the 200-DMA, keeping in line with the higher-low structure," says Gawkar. Meanwhile, amid the downturn, 88 per cent or 88 out of the Nifty Midcap 100 stocks were quoting below their respective short-term 20-DMAs, and 58 shares traded below the long-term 200-DMAs. 

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 Gawkar says this shows that the short-term trend for midcap stocks has taken a beating. However, with the balance 42 per cent of stocks holding above their respective 200-DMAs, this suggests that the midcap index has been rising amid selective buying. An analysis of Midcap 100 stocks as per ACE Equity shows that 37 midcap stocks declined more than 10 per cent from their respective highs in the last three weeks. Top losers were Godrej Properties, Bharat Dynamics and KEI Industries - down over 20 per cent each. Some of the prominent midcap stocks trading below both the long-term and short-term moving averages are - BSE, Fortis Healthcare, GMR Airports, Ashok Leyland, Dabur India, UPL, Hero MotoCorp, SBI Card, Havells India, Biocon, Suzlon and Swiggy. Going forward, Gawkar expects the selective positive bias in midcap stocks to continue. The analyst sees near resistance for the Nifty Midcap 100 index at 62,000 levels, above which it can extend the rally to 63,000 and 64,000 levels. Gawkar does not rule out the possibility of the index reaching new highs by the end of the year.