Nifty Metal bounces back from long-term support levels, can gain another 7%

Metal stocks seem to have weathered the current downtrend in equity markets better compared to the benchmark and broader indices. The Nifty Metal index has slipped 1.5 per cent as against a 3.5 per cent fall in the benchmark Nifty 50; and a 5.8 per cent and 8.5 per cent decline in the Nifty MidCap 150 and Nifty SmallCap 250 indices.  Technically, the Nifty Metal index is seen testing the key support at its 100-WMA (Weekly Moving Average) since mid-January. Despite repeated attempts to violate the same, the index has managed to survive above the same for the last six weeks. Further, the Nifty Metal index is also seen testing and respecting the support at its 20-MMA (Monthly Moving Average).  The key 100-WMA support for the Nifty Metal index stands at 7,975, and the 20-MMA at 8,385. Charts suggest that the near-term bias for the Metal index is likely to remain cautiously optimistic as long as the index sustains above these two moving averages on a closing basis.  On Friday, the Nifty Metal index was a standout gainer, up nearly 1 per cent in an otherwise weak market. The Sensex and the Nifty were down 0.5 per cent each owing to global turmoil.    "The sentiment in global markets weighed under the US President Trump's tariff threats and lack of progress in resolution of the Russia-Ukraine conflict", said Kranthi Bathini, Director - Equity Strategy at WealthMills Securities.  As the Nifty Metal index outperforms - select stocks such as Hindalco, SAIL and Tata Steel seem to be favourably placed on the charts.  Here's a technical outlook on the Nifty Metal index and key stocks from the sector.  Nifty Metal  Current Level: 8,600  Upside Potential: 7.3%  Support: 8,385; 7,975  Resistance: 8,935  With today's near 1 per cent rally, the Nifty Metal index was seen trading above its 50-DMA (Daily Moving Average) for the first time since mid-December. The Metal index seems on course to test the resistance at its 100-DMA at 8,935; above which a rally towards the 200-DMA at 9,230 levels seems likely. The key support as mentioned above stands at 8,385 and 7,975 levels. CLICK HERE FOR THE CHART  ALSO READ: TCS stock can tank 16%, trades below this key monthly support after June 23  Tata Steel  Current Price: Rs 139  Upside Potential: 10.8%  Support: Rs 134  Resistance: Rs 142; Rs 148  Tata Steel stock is seen trading above its short-term moving averages - i.e. the 20- and 50-DMA for more than three consecutive trading sessions for the first time since October 10, 2024. The daily chart shows that the stock is within striking distance of the 100-DMA hurdle at Rs 142. Break and sustained trade above the same can trigger a rally towards Rs 148 and Rs 154 levels. On the downside, key support for the stock is seen at Rs 134. CLICK HERE FOR THE CHART  Hindalco  Current Price: Rs 651  Upside Potential: 12.1%  Support: Rs 599  Resistance: Rs 661; Rs 685  Hindalco has rallied nearly 10 per cent so far this month after testing support at its 20-MMA at Rs 599. On the daily scale, the stock is seen trading above its 100-DMA for the first time since November 06, 2024. The stock is now trading within striking distance of its 200-DMA hurdle at Rs 661. On the upside, the stock can potentially rally to Rs 730 levels, with interim resistance seen at Rs 685. CLICK HERE FOR THE CHART  SAIL  Current Price: Rs 113  Upside Potential: 9.6%  Support: Rs 109.80; Rs 106.40  Resistance: Rs 115.70; Rs 121; Rs 123.80  SAIL has surged 3 per cent in Friday's trade, and is seen attempting a breakout on the daily scale. A close above Rs 111.70 shall confirm the same. Near support for the stock is seen at Rs 109.80 followed by Rs 106.40. On the upside, the stock can potentially soar to Rs 128 with interim resistance expected at Rs 115.70, Rs 121 and Rs 123.80 levels. CLICK HERE FOR THE CHART