Bharat Heavy Electricals Ltd. Shows Signs of Mild Bullish Momentum Amid Mixed Technical Indicators

Technical Trend Evolution and Price Momentum

After a prolonged period of lateral movement, BHEL’s price momentum has begun to show signs of improvement. The stock closed at ₹267.80 on 4 Feb 2026, marking a 3.78% gain from the previous close of ₹258.05. Intraday volatility saw the price oscillate between ₹261.70 and ₹271.75, reflecting increased trading interest. Despite this positive daily movement, the stock remains below its 52-week high of ₹305.85, indicating room for further upside.

Over the short term, BHEL’s weekly returns have outperformed the benchmark Sensex, delivering an 8.03% gain against Sensex’s 2.30% in the past week. However, the one-month and year-to-date returns tell a more cautious story, with BHEL declining 10.57% and 6.85% respectively, compared to Sensex’s smaller declines of 2.36% and 1.74%. This divergence highlights the stock’s recent volatility and the need for a nuanced technical analysis.

MACD and Momentum Oscillators: Mixed Signals

The Moving Average Convergence Divergence (MACD) indicator remains mildly bearish on both weekly and monthly timeframes, signalling that the underlying momentum has yet to fully confirm a sustained uptrend. The MACD line is hovering just below the signal line, suggesting that while selling pressure has eased, bullish momentum is still tentative.

Meanwhile, the Relative Strength Index (RSI) on weekly and monthly charts is neutral, showing no clear overbought or oversold conditions. This lack of extreme RSI readings implies that the stock is not currently stretched in either direction, allowing room for a potential trend development without immediate risk of reversal due to exhaustion.

Bollinger Bands and Moving Averages Indicate Emerging Strength

BHEL’s Bollinger Bands have turned bullish on both weekly and monthly charts, with the price moving closer to the upper band. This suggests increasing volatility accompanied by upward price pressure, a positive sign for momentum traders. The daily moving averages also support a mildly bullish outlook, with the stock price trading above its short-term moving averages, indicating a potential shift in investor sentiment.

Other Technical Indicators: KST, Dow Theory, and OBV

The Know Sure Thing (KST) oscillator remains mildly bearish on weekly and monthly frames, reinforcing the cautious stance suggested by MACD. Dow Theory analysis on the weekly chart also signals mild bearishness, while the monthly chart shows no definitive trend, reflecting the stock’s current consolidation phase.

On-Balance Volume (OBV) indicators show no clear trend on weekly or monthly scales, indicating that volume flow has not decisively favoured buyers or sellers. This neutral volume pattern suggests that while price movements have gained momentum, they are not yet supported by strong accumulation or distribution.

Long-Term Performance and Relative Strength

Examining BHEL’s longer-term returns reveals a compelling growth story. Over the past year, the stock has surged 36.53%, significantly outperforming the Sensex’s 8.49% gain. The three-year and five-year returns are even more impressive, with BHEL delivering 257.30% and 574.56% respectively, dwarfing the Sensex’s 37.63% and 66.63% gains over the same periods. This outperformance underscores the company’s resilience and growth potential within the heavy electrical equipment sector.

However, the ten-year return of 213.09% trails the Sensex’s 245.70%, indicating that while BHEL has been a strong performer in recent years, it has lagged the broader market over the longer term. This mixed relative strength profile suggests that investors should weigh both the company’s cyclical recovery prospects and sector-specific risks.

Mojo Score Upgrade Reflects Improving Technical and Fundamental Outlook

MarketsMOJO has upgraded BHEL’s Mojo Grade from Sell to Hold as of 15 Sep 2025, reflecting an improved technical and fundamental outlook. The current Mojo Score stands at 65.0, signalling moderate confidence in the stock’s near-term prospects. The Market Cap Grade remains low at 2, consistent with BHEL’s mid-cap status and the inherent volatility in the heavy electrical equipment industry.

This upgrade aligns with the observed technical trend shift from sideways to mildly bullish, suggesting that the stock is entering a phase of consolidation with potential for upside breakout. Investors should monitor key technical levels and volume patterns to confirm sustained momentum.

Investor Takeaway and Outlook

BHEL’s technical indicators collectively paint a picture of cautious optimism. The mildly bullish daily moving averages and bullish Bollinger Bands suggest that the stock is gaining upward momentum, yet the persistent mild bearishness in MACD and KST oscillators on weekly and monthly charts counsel prudence. The neutral RSI and OBV readings further imply that the stock is in a consolidation phase, awaiting a decisive catalyst to confirm a sustained uptrend.

For investors, this means that while BHEL is showing signs of recovery and momentum improvement, it remains vulnerable to sectoral headwinds and broader market volatility. The stock’s strong long-term returns relative to the Sensex provide a foundation of confidence, but the recent short-term underperformance and mixed technical signals warrant a balanced approach.

Monitoring price action around the current ₹267.80 level, especially in relation to the 52-week high of ₹305.85 and the 52-week low of ₹176.00, will be critical. A sustained move above the upper Bollinger Band and confirmation from MACD crossover could signal a more robust bullish phase. Conversely, failure to hold above key moving averages may indicate a return to sideways or bearish trends.

In summary, Bharat Heavy Electricals Ltd. is at a technical inflection point, with momentum indicators suggesting a mild bullish tilt but lacking full confirmation. Investors should consider this nuanced technical landscape alongside fundamental factors and sector dynamics when making portfolio decisions.

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