Carborundum Universal Ltd Sees Mixed Technical Signals Amid Mild Momentum Shift

Technical Trend and Momentum Overview

As of 29 Jan 2026, Carborundum Universal Ltd’s technical trend has transitioned from a firmly bearish outlook to a mildly bearish one. This subtle improvement reflects a slight easing of downward pressure but does not yet indicate a definitive reversal. The stock closed at ₹832.45, up from the previous close of ₹821.40, with intraday highs reaching ₹840.00 and lows of ₹809.00. Despite this uptick, the stock remains well below its 52-week high of ₹1,217.15, signalling that significant resistance levels persist.

The daily moving averages continue to signal bearish momentum, underscoring that short-term price action remains under pressure. However, weekly and monthly indicators provide a more nuanced view, with some oscillators suggesting emerging bullish tendencies.

MACD and RSI: Divergent Signals

The Moving Average Convergence Divergence (MACD) indicator remains bearish on both weekly and monthly timeframes, indicating that the stock’s momentum is still tilted towards the downside. The MACD line continues to trade below the signal line, and histogram values remain negative, reflecting persistent selling pressure.

Conversely, the Relative Strength Index (RSI) on the weekly chart has turned bullish, signalling that the stock may be gaining positive momentum in the short term. The weekly RSI has risen above the neutral 50 mark, suggesting improving buying interest. However, the monthly RSI remains neutral with no clear signal, indicating that longer-term momentum has yet to confirm a sustained uptrend.

Bollinger Bands and Moving Averages

Bollinger Bands on the weekly chart show a mildly bearish stance, with the stock price hovering near the lower band but not decisively breaking below it. This suggests that while volatility remains elevated, the stock is not in an extreme oversold condition. On the monthly scale, Bollinger Bands remain bearish, reinforcing the longer-term downward pressure.

Daily moving averages continue to slope downward, with the 50-day moving average below the 200-day average, a classic bearish crossover. This alignment typically signals that the stock is in a downtrend, and investors should exercise caution until a clear reversal pattern emerges.

Additional Technical Indicators: KST, Dow Theory, and OBV

The Know Sure Thing (KST) indicator remains bearish on both weekly and monthly charts, reinforcing the prevailing negative momentum. This oscillator’s readings suggest that the stock’s price action is unlikely to gain strong upward traction in the near term.

Interestingly, the Dow Theory presents a mixed picture: weekly signals are mildly bullish, hinting at potential short-term strength, while monthly signals remain mildly bearish, reflecting longer-term caution. This divergence highlights the importance of monitoring multiple timeframes for a comprehensive view.

On the volume front, the On-Balance Volume (OBV) indicator is bullish on both weekly and monthly scales, indicating that buying volume is outpacing selling volume. This positive volume trend could support price stability or a gradual recovery if sustained.

Stock Performance Relative to Sensex

Carborundum Universal Ltd’s recent returns have been mixed when compared to the Sensex benchmark. Over the past week, the stock outperformed the Sensex with a 3.88% gain versus the index’s 0.53%. However, over the last month and year-to-date periods, the stock has underperformed, declining by 2.09% and 2.82% respectively, while the Sensex fell by 3.17% and 3.37% over the same intervals.

Longer-term performance shows a more challenging picture. Over the past year, the stock has declined sharply by 27.88%, contrasting with the Sensex’s 8.49% gain. Over three years, Carborundum Universal Ltd has fallen 11.27%, while the Sensex has surged 38.79%. Despite these setbacks, the stock has delivered impressive returns over five and ten years, rising 98.39% and 391.85% respectively, outperforming the Sensex’s 75.67% and 236.52% gains over the same periods. This suggests that while recent momentum has been weak, the company has demonstrated strong long-term growth potential.

Mojo Score and Ratings Update

MarketsMOJO’s latest assessment assigns Carborundum Universal Ltd a Mojo Score of 35.0, categorising it as a Sell. This represents an upgrade from the previous Strong Sell grade issued on 1 Jan 2026, reflecting the mild improvement in technical parameters. The Market Cap Grade stands at 3, indicating a mid-tier valuation relative to peers in the Industrial Products sector.

The upgrade from Strong Sell to Sell suggests that while the stock remains under pressure, the worst of the downtrend may be easing. Investors should remain cautious but watch for confirmation of a sustained trend reversal before increasing exposure.

Outlook and Investor Considerations

Carborundum Universal Ltd’s technical indicators present a nuanced outlook. The mixed signals from MACD, RSI, Bollinger Bands, and volume-based indicators imply that the stock is at a potential inflection point. The bullish weekly RSI and OBV readings offer some optimism for short-term recovery, but the persistent bearish MACD and moving averages caution against premature optimism.

Investors should monitor key support levels near ₹775.00, the 52-week low, and resistance around ₹840.00 and the 52-week high of ₹1,217.15. A decisive break above the daily moving averages and a sustained bullish crossover in MACD would be necessary to confirm a trend reversal.

Given the stock’s historical long-term outperformance and recent technical stabilisation, selective accumulation on dips could be considered by risk-tolerant investors. However, those seeking safer exposure may prefer to wait for clearer confirmation of momentum improvement.

Summary

In summary, Carborundum Universal Ltd is navigating a complex technical landscape with signs of mild improvement amid persistent bearish pressures. The upgrade in its Mojo Grade from Strong Sell to Sell reflects this subtle shift. While short-term indicators such as weekly RSI and OBV suggest potential for a modest rebound, longer-term signals remain cautious. Investors should weigh these mixed signals carefully, considering both the stock’s historical resilience and current technical challenges before making investment decisions.

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