HFCL Ltd Technical Momentum Shifts Amid Mixed Indicator Signals

Technical Trend Overview and Price Movement

HFCL Ltd, a key player in the Telecom - Equipment & Accessories sector, has seen its technical trend evolve from mildly bearish to sideways in recent weeks. The stock closed at ₹72.03 on 18 Feb 2026, up from the previous close of ₹69.02, marking a robust day change of 4.36%. The intraday high touched ₹73.00, while the low was ₹69.01, indicating increased volatility and buying interest near the upper band.

Over the past 52 weeks, HFCL’s price has oscillated between ₹59.83 and ₹93.95, reflecting a wide trading range amid sectoral headwinds and broader market fluctuations. The current price remains approximately 23% below its 52-week high, signalling room for recovery but also caution given the recent downward pressure.

MACD and Momentum Oscillators Signal Divergence

The Moving Average Convergence Divergence (MACD) indicator presents a mixed picture. On a weekly timeframe, MACD is mildly bullish, suggesting a potential for upward momentum in the near term. However, the monthly MACD remains bearish, indicating that the longer-term trend is still under pressure. This divergence highlights the stock’s current consolidation phase, where short-term gains may be offset by longer-term caution.

Similarly, the Know Sure Thing (KST) oscillator aligns with this pattern, showing mild bullishness on the weekly chart but bearishness on the monthly scale. This reinforces the notion that while short-term momentum is improving, the broader trend remains subdued.

RSI and Bollinger Bands Reflect Mixed Sentiment

The Relative Strength Index (RSI) on the weekly chart is neutral, offering no clear buy or sell signal. Conversely, the monthly RSI is bullish, indicating that the stock may be gaining strength over a longer horizon. This suggests that while immediate price action is uncertain, underlying momentum could be building.

Bollinger Bands further illustrate this duality. Weekly Bollinger Bands are bullish, with price action approaching the upper band, signalling increased buying pressure. However, monthly Bollinger Bands remain mildly bearish, reflecting the stock’s struggle to break out decisively from its longer-term range.

Moving Averages and Dow Theory Insights

Daily moving averages currently show a mildly bearish trend, with the stock price hovering near the short-term averages but failing to establish a clear breakout. This suggests that while buyers are active, sellers remain vigilant, preventing a sustained rally.

Dow Theory analysis echoes this sentiment, with weekly signals mildly bullish but monthly signals mildly bearish. This further confirms the stock’s current sideways consolidation, where neither bulls nor bears have definitive control.

On-Balance Volume (OBV) Indicates Positive Accumulation

One of the more encouraging technical signals comes from the On-Balance Volume (OBV) indicator, which is bullish on both weekly and monthly timeframes. This suggests that volume trends are supportive of price gains, with accumulation potentially underway despite the mixed price momentum.

Comparative Returns and Market Context

HFCL’s recent returns present a mixed picture when compared with the broader Sensex index. Over the past week, the stock declined marginally by 0.40%, outperforming the Sensex’s 0.98% fall. Over one month and year-to-date periods, HFCL posted gains of 6.07% and 6.32% respectively, while the Sensex declined by 0.14% and 2.08%. However, over the past year, HFCL’s return was negative at -17.29%, contrasting with the Sensex’s positive 9.81% gain.

Longer-term returns are more favourable for HFCL, with a five-year return of 138.12% significantly outperforming the Sensex’s 61.40%, and a ten-year return of 315.16% versus the Sensex’s 256.90%. This highlights the company’s strong historical growth trajectory despite recent volatility.

Mojo Score and Analyst Ratings

HFCL currently holds a Mojo Score of 42.0, categorised as a Sell rating, an improvement from its previous Strong Sell grade as of 17 Nov 2025. This upgrade reflects a modest improvement in technical and fundamental factors, though the score remains below the threshold for a Hold or Buy recommendation. The Market Cap Grade stands at 3, indicating a mid-tier market capitalisation relative to peers in the Telecom - Equipment & Accessories sector.

Investors should note that while the technical indicators show signs of stabilisation, the overall rating suggests caution. The stock’s sideways momentum and mixed signals imply that a clear directional trend has yet to emerge, warranting close monitoring for confirmation of sustained strength or renewed weakness.

Sectoral and Industry Considerations

Within the Telecom - Equipment & Accessories industry, HFCL faces competitive pressures and cyclical demand fluctuations. The sector’s capital-intensive nature and sensitivity to technological shifts require companies to maintain robust innovation and cost management. HFCL’s recent technical signals may reflect market anticipation of upcoming earnings or contract wins, but the broader sector environment remains challenging.

Investors should weigh HFCL’s technical momentum against sectoral trends and macroeconomic factors, including government infrastructure spending and telecom policy developments, which could materially impact future performance.

Investor Takeaway and Outlook

HFCL Ltd’s recent technical parameter changes suggest a stock in transition. The shift from mildly bearish to sideways momentum, supported by bullish weekly MACD and OBV readings, indicates potential for a short-term rebound. However, the bearish monthly MACD and mildly bearish moving averages counsel prudence, as the longer-term trend remains under pressure.

Investors should monitor key technical levels, including the 52-week low of ₹59.83 and the resistance near ₹74-75, which corresponds to recent highs and the upper Bollinger Band on the weekly chart. A sustained break above these levels could confirm a bullish reversal, while failure to hold current support may signal further downside risk.

Given the mixed signals and sectoral challenges, HFCL is best suited for investors with a moderate risk appetite who can tolerate volatility and seek to capitalise on potential technical rebounds. Those with a lower risk tolerance may prefer to await clearer confirmation of trend direction before initiating or adding to positions.

Overall, HFCL’s technical landscape is evolving, with early signs of momentum improvement tempered by longer-term caution. Continuous monitoring of technical indicators alongside fundamental developments will be essential for informed investment decisions.

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