Technical analysis: Tata Steel trading near its crucial support level

Technical analysis: Tata Steel trading near its crucial support level

by 5paisa Research Team Last Updated: Nov 16, 2021, 01:12 PM IST

Tata Steel Limited is presently trading near its crucial support level which is also its important Fibonacci level. Read on to find out more.

In the last one and half years, Tata Steel Limited rallied almost 537.54%. It was in August 2021, that the stock took a breather and began to decline. Post making a high of 1,534.5, the stock started moving downwards and generated a negative 20.32% till now. Even the Nifty Metal Index moved into consolidation in July 2021. As it is range-bound consolidation, it is difficult to predict the direction. Tata Steel Ltd has the highest weightage of 23.56% in the Nifty Metal Index.

Moreover, since August 2020 this stock began to underperform Nifty Metal Index. In fact, its Relative Strength (RS) began to fall and is trading below its 9-Day Simple Moving Average (SMA). This shows weakness relative to its benchmark index. The Relative Strength Index (RSI) is presently trading below its 9-Day Exponential Moving Average (EMA) 58.64 at a 50.65 level. Moving Average Convergence and Divergence (MACD) though in the positive territory has shown a negative crossover in the first week of September 2021. The stock is presently heading towards the lower Bollinger band. Looking at Commodity Channel Index (CCI), it is heading towards the oversold zone.

The stock is presently trading near its crucial support level of 1,232.9 and is also near its important Fibonacci level of 23.6% (level of 1,228.8).

So, not it would be quite interesting to see how the stock moves. If it moves ahead and breaches this support level then the stock would likely chase the level of 1,040-1,049. On the upwards, 1,426.55-1,481.8-1,534.5 levels would work as resistance for the stock, breaching would help decide its further direction.

At the time of writing the stock was trading at 1,236.80 levels.

SENSEX
54,326.39
1,534.16 (2.91%)
Nifty 50
16,266.15
456.75 (2.89%)
Nifty Bank
34,276.40
960.75 (2.88%)
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SENSEX
54,326.39
1,534.16 (2.91%)
Nifty 50
16,266.15
456.75 (2.89%)
Nifty Bank
34,276.40
960.75 (2.88%)

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