HFCL Ltd Technical Momentum Shifts Amid Mixed Indicator Signals

Price Movement and Market Context

On 20 Feb 2026, HFCL closed at ₹71.45, down 3.21% from the previous close of ₹73.82. The stock traded within a range of ₹70.50 to ₹75.40 during the day, remaining well below its 52-week high of ₹93.95 but comfortably above the 52-week low of ₹59.83. This price behaviour suggests a consolidation phase with mild bearish undertones, as the stock struggles to regain upward momentum.

Comparatively, HFCL’s returns over various periods present a mixed picture. The stock outperformed the Sensex over the past month and year-to-date, delivering gains of 7.77% and 5.46% respectively, while the Sensex declined by 0.90% and 3.19% over the same periods. However, over the one-year horizon, HFCL lagged significantly with a negative return of 19.51%, contrasting with the Sensex’s 8.64% gain. Longer-term returns remain robust, with 5-year and 10-year returns at 143.86% and 300.28%, well above the Sensex’s 62.11% and 247.96% respectively.

Technical Trend Shift: Sideways to Mildly Bearish

The technical trend for HFCL has transitioned from a sideways pattern to a mildly bearish stance. This shift is corroborated by daily moving averages, which currently signal mild bearishness as the stock price remains below key short-term averages. The daily moving averages’ downward slope indicates a cautious outlook among traders, with selling pressure gradually increasing.

Weekly and monthly technical indicators present a more nuanced scenario. The weekly MACD (Moving Average Convergence Divergence) remains mildly bullish, suggesting some underlying positive momentum in the short term. Conversely, the monthly MACD is bearish, indicating that longer-term momentum is weakening. This divergence between weekly and monthly MACD readings highlights the stock’s current technical uncertainty.

RSI and Bollinger Bands: Conflicting Signals

The Relative Strength Index (RSI) on a weekly basis shows no clear signal, hovering near neutral levels that neither indicate overbought nor oversold conditions. However, the monthly RSI is bullish, implying that the stock may have room to rally over the medium term if buying interest intensifies.

Bollinger Bands add further complexity. Weekly Bollinger Bands are bullish, with the price approaching the upper band, signalling potential upward momentum or a short-term breakout. In contrast, monthly Bollinger Bands are mildly bearish, reflecting broader volatility and a possible downtrend over the longer horizon.

Other Technical Indicators: KST, Dow Theory, and OBV

The Know Sure Thing (KST) indicator, which helps identify major price cycles, is bearish on both weekly and monthly charts, reinforcing the cautionary tone for HFCL’s medium- to long-term outlook. This bearish KST reading suggests that the stock may face downward pressure unless there is a significant catalyst to reverse the trend.

Dow Theory analysis offers a mixed view: weekly signals are mildly bullish, hinting at short-term strength, while monthly signals are mildly bearish, consistent with other longer-term indicators. This divergence underscores the importance of timeframe when interpreting HFCL’s technical health.

On-Balance Volume (OBV), a volume-based indicator, is bullish on both weekly and monthly scales. This suggests that despite price weakness, accumulation by investors is occurring, which could provide a foundation for a potential rebound if buying volume sustains.

Mojo Score and Grade Update

HFCL’s Mojo Score currently stands at 37.0, reflecting a Sell rating, an upgrade from the previous Strong Sell grade assigned on 17 Nov 2025. This improvement indicates a slight easing of negative sentiment, though the overall outlook remains cautious. The Market Cap Grade is 3, signalling a mid-tier market capitalisation relative to peers in the Telecom - Equipment & Accessories sector.

Investors should note that the downgrade from Strong Sell to Sell suggests that while the stock is no longer in the most severe category of technical weakness, it still faces significant headwinds. The mixed technical signals reinforce the need for careful monitoring of price action and volume trends before committing to new positions.

Investment Implications and Outlook

HFCL’s technical landscape presents a challenging environment for investors. The coexistence of mildly bullish weekly MACD and OBV with bearish monthly MACD and KST suggests that short-term traders may find opportunities in price fluctuations, but longer-term investors should exercise caution.

The stock’s recent price decline and mild bearish trend on daily moving averages indicate that momentum is not yet firmly established to the upside. However, the bullish monthly RSI and weekly Bollinger Bands hint at potential for recovery if positive catalysts emerge, such as sectoral tailwinds or company-specific developments.

Given the stock’s historical outperformance over five and ten years relative to the Sensex, long-term investors may consider HFCL as a cyclical opportunity, provided they are comfortable with volatility and can monitor technical signals closely.

In summary, HFCL Ltd currently exhibits a technical profile characterised by mixed signals and a mild bearish tilt, with some underlying bullish momentum in shorter timeframes. Investors should weigh these factors alongside fundamental analysis and sector outlook before making investment decisions.

Limited Period Only. Start at Rs. 9,999 - Get MojoOne for 1 Year + 3 Months FREE (60% Off) Get 71% Off →