Technical Analysis: Is NMDC all set to rise?

Technical Analysis: Is NMDC all set to rise?

by 5paisa Research Team Last Updated: Dec 12, 2022 - 02:02 pm 47.9k Views
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Rounding bottom chart pattern formed for NMDC on daily charts. It gave a breakout and also witnessed a pullback. So, it is all set to rise high? Let’s find out.

NMDC Ltd made an all-time high of 322.05 in January 2010, post which it began its downward move. In August 2013, it made a low of 55.55 posts which gave a strong up move and made a high of 128.95. Since then, it has been trading in a range-bound fashion between 133.65 and 52.60 forming a rounding bottom like chart pattern. It is in the month of March 2021 when it gave breakout from the long-term resistance zone of 125-133.65. Moreover, its long-term support is placed at 52.60 levels.

Post breakout from the crucial resistance zone, it made a high of 213.2 before the price started inching downwards. However, the price respected the resistance turned support zone of 125-133.65 and is presently trading above it. This shows how crucial is this price zone. Moreover, last week that is on October 29, 2021, it made a bullish engulfing candlestick pattern on the same crucial price zone on daily charts. This suggests that the price pullback seems to be over and the price is likely to move upwards from here. However, on the upside 213.2-220 would be its immediate resistance. If the price successfully breaches this resistance, then the possibility of more upside cannot be ignored.

It is presently trading below its 50-Day Exponential Moving Average (EMA) but is trading near its 20-Day EMA. If we look at the Relative Strength Index (RSI), then it is presently trading at 48 levels, above its 20-Day EMA of 45. On the other hand, Moving Average Convergence Divergence (MACD) is neutral and the Rate of Change (ROC) is presently trading below zero level. However, it is indeed picking pace. If the same moves above zero and subsequently above 10, the stock would further grow.

At the time of writing, the stock was trading at 144.65.

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