Technical Momentum Shifts to Bearish
Recent technical assessments indicate that Centrum Capital’s momentum has shifted from mildly bearish to outright bearish. The Moving Average Convergence Divergence (MACD) on a weekly basis confirms a bearish stance, while the monthly MACD remains mildly bearish, suggesting that the downward pressure is intensifying in the short term but still shows some residual caution over the longer horizon.
The Relative Strength Index (RSI), however, remains neutral with no clear signal on both weekly and monthly charts, indicating that the stock is neither oversold nor overbought at present. This neutrality in RSI suggests that while momentum is negative, there is no extreme condition that might trigger an immediate reversal.
Bollinger Bands reinforce the bearish outlook, with both weekly and monthly readings indicating the stock price is trending towards the lower band, a classic sign of downward pressure and increased volatility. Daily moving averages also align with this bearish sentiment, confirming that the stock is trading below key average price levels, which typically acts as resistance in a downtrend.
Additional Technical Indicators Confirm Weakness
The Know Sure Thing (KST) indicator, which helps identify momentum changes, is bearish on a weekly scale and mildly bearish monthly, further corroborating the negative trend. Meanwhile, Dow Theory analysis shows no clear trend on either weekly or monthly timeframes, reflecting uncertainty in the broader market context for this stock.
On-Balance Volume (OBV) presents a mildly bullish signal weekly, suggesting some accumulation by investors despite the price decline. However, the monthly OBV shows no trend, indicating that this buying interest may be limited or short-lived.
Price Performance and Market Comparison
Centrum Capital’s current price of ₹28.66 is significantly below its 52-week high of ₹41.90 and closer to its 52-week low of ₹22.41, highlighting the stock’s recent volatility and downward trajectory. Today’s trading range was between ₹28.51 and ₹30.04, with the previous close at ₹30.04, marking a sharp intraday decline.
When compared to the broader market, the stock has underperformed the Sensex across multiple timeframes. Over the past week, Centrum Capital declined by 2.42%, while the Sensex fell by 1.18%. Over one month, the stock dropped 1.24% versus the Sensex’s 1.08% decline. Year-to-date, Centrum Capital is down 1.48%, slightly worse than the Sensex’s 1.22% fall.
More strikingly, over the last year, Centrum Capital has fallen 10.91%, contrasting with the Sensex’s robust 7.72% gain. Even over three and five years, the stock’s returns of 17.94% and 52.45% respectively lag behind the Sensex’s 40.53% and 72.56% gains. Over a decade, Centrum Capital’s 103.41% return is less than half of the Sensex’s 237.61%, underscoring a persistent underperformance trend.
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Implications for Investors and Market Outlook
The downgrade in Centrum Capital’s Mojo Grade from Sell to Strong Sell on 24 Nov 2025, with a current Mojo Score of 16.0, reflects the deteriorating technical and fundamental outlook. The Market Cap Grade of 3 further indicates limited market capitalisation strength relative to peers.
Given the bearish technical signals across multiple indicators and the stock’s underperformance relative to the Sensex, investors should exercise caution. The absence of strong bullish signals from RSI and Dow Theory suggests that any potential recovery may be tentative and short-lived.
Moreover, the daily moving averages acting as resistance and the bearish Bollinger Bands imply that the stock could face further downside pressure in the near term. The mildly bullish OBV weekly reading offers a slight counterpoint, hinting at some investor interest at current levels, but this is insufficient to offset the broader negative momentum.
Sector Context and Comparative Analysis
Within the NBFC sector, Centrum Capital’s technical deterioration contrasts with some peers that have shown more resilience or even positive momentum. This divergence highlights the importance of peer comparison when evaluating investment decisions in this space.
Investors should also consider the broader macroeconomic environment impacting NBFCs, including interest rate trends, credit growth, and regulatory developments, which can influence sector-wide performance and individual stock trajectories.
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Conclusion: Navigating the Bearish Terrain
Centrum Capital Ltd’s technical indicators collectively signal a bearish momentum shift that investors cannot ignore. The combination of a strong sell rating, declining price momentum, and underperformance relative to the benchmark Sensex suggests that the stock is currently in a weak phase.
While some mild bullish volume signals exist, they are insufficient to counterbalance the prevailing negative trend. Investors should monitor key technical levels closely, particularly the moving averages and Bollinger Bands, for any signs of reversal or further deterioration.
Given the current landscape, a cautious approach is advisable, with consideration given to alternative NBFC stocks exhibiting stronger technical and fundamental profiles.
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