NMDC Steel Ltd Shows Mildly Bullish Momentum Amid Mixed Technical Signals

Technical Trend Shift and Price Movement

Recent trading sessions have seen NMDC Steel Ltd’s share price rise to ₹42.32, up 2.42% from the previous close of ₹41.32. The stock touched an intraday high of ₹42.65 and a low of ₹40.22, reflecting increased volatility within a relatively narrow range. Over the past week, the stock has delivered a robust return of 6.92%, significantly outperforming the Sensex’s modest 0.16% gain. However, the one-month return paints a different picture, with NMDC Steel declining by 7.48%, slightly worse than the Sensex’s 4.78% fall, indicating short-term headwinds.

Technically, the stock’s trend has evolved from sideways to mildly bullish, primarily driven by daily moving averages that have turned positive. The 50-day and 200-day moving averages are showing signs of convergence, which often precedes a sustained upward move if confirmed by volume and momentum indicators.

MACD and Momentum Indicators

The Moving Average Convergence Divergence (MACD) indicator remains mildly bearish on both weekly and monthly timeframes, signalling that the underlying momentum is yet to fully confirm a bullish reversal. The MACD line continues to hover below the signal line, suggesting that while short-term price gains are evident, the broader momentum remains subdued. This divergence between price action and momentum indicators warrants caution, as it may indicate a potential pullback or consolidation phase ahead.

The Relative Strength Index (RSI) on weekly and monthly charts currently shows no clear signal, hovering around neutral levels. This lack of directional bias in RSI suggests that the stock is neither overbought nor oversold, providing limited guidance on imminent price moves. Investors should monitor RSI closely for any breakout above 70 or drop below 30, which would indicate stronger momentum shifts.

Bollinger Bands and Volatility Assessment

Bollinger Bands on the weekly chart indicate a sideways movement, with the price oscillating near the middle band. This reflects a period of consolidation with limited volatility expansion. Conversely, the monthly Bollinger Bands are bearish, with the price trending towards the lower band, signalling potential downside risk over a longer horizon. This mixed volatility picture underscores the importance of monitoring price action closely for any breakout or breakdown from the current range.

Moving Averages and KST Indicator

Daily moving averages have turned bullish, signalling a positive short-term trend. The 20-day moving average has crossed above the 50-day moving average, a classic bullish crossover that often attracts buying interest. This technical development aligns with the weekly KST (Know Sure Thing) indicator, which is also bullish, reinforcing the notion of improving momentum in the near term.

However, the monthly KST indicator remains inconclusive, reflecting the stock’s mixed longer-term momentum. This divergence between weekly and monthly KST readings suggests that while short-term traders may find opportunities, longer-term investors should remain vigilant for confirmation of sustained strength.

Volume and Trend Confirmation

On-Balance Volume (OBV) indicators on both weekly and monthly charts show no clear trend, indicating that volume has not decisively supported the recent price moves. This lack of volume confirmation may limit the durability of the current price gains and suggests that the stock could be vulnerable to profit-taking or sideways consolidation.

Similarly, Dow Theory assessments on weekly and monthly timeframes indicate no definitive trend, underscoring the stock’s current phase of indecision. This technical ambiguity calls for a cautious approach, with investors advised to watch for clear breakout or breakdown signals before committing significant capital.

Valuation and Market Capitalisation Context

NMDC Steel Ltd currently holds a Market Cap Grade of 3, reflecting a mid-tier market capitalisation relative to its peers in the ferrous metals sector. The company’s Mojo Score stands at 39.0, with a recent upgrade from a Strong Sell to a Sell rating on 28 January 2026. This rating adjustment indicates a slight improvement in technical outlook, though the overall sentiment remains bearish.

Comparing returns, NMDC Steel has underperformed the Sensex over the year-to-date period, with a -4.38% return versus the Sensex’s -4.17%. Over the one-year horizon, the stock has delivered a modest 4.31% gain, lagging the Sensex’s 5.37% rise. Longer-term data is unavailable, but the Sensex’s strong 36.26% and 64.00% returns over three and five years respectively highlight the broader market’s outperformance relative to this stock.

Investor Takeaway and Outlook

NMDC Steel Ltd’s recent technical developments suggest a tentative shift towards a mildly bullish momentum, supported by daily moving averages and weekly KST indicators. However, the persistence of bearish signals from MACD and monthly Bollinger Bands, combined with neutral RSI and lack of volume confirmation, tempers enthusiasm for a sustained rally.

Investors should consider the stock’s current price of ₹42.32 in the context of its 52-week high of ₹49.62 and low of ₹28.35, recognising that the stock remains closer to its upper range but has yet to decisively break out. The mixed technical signals imply that while short-term trading opportunities may exist, longer-term investors should await clearer confirmation of trend direction before increasing exposure.

Given the company’s Mojo Grade of Sell and a modest Market Cap Grade, NMDC Steel Ltd may appeal more to risk-tolerant traders seeking to capitalise on short-term momentum shifts rather than conservative investors prioritising stable growth and strong fundamentals.

Monitoring key technical indicators such as MACD crossovers, RSI breakouts, and volume trends will be critical in the coming weeks to gauge whether the current mild bullishness can evolve into a more robust uptrend or if the stock will revert to sideways or bearish patterns.

Summary of Technical Ratings:

• MACD: Weekly and Monthly - Mildly Bearish
• RSI: Weekly and Monthly - Neutral (No Signal)
• Bollinger Bands: Weekly - Sideways; Monthly - Bearish
• Moving Averages: Daily - Bullish
• KST: Weekly - Bullish; Monthly - Neutral
• Dow Theory: Weekly and Monthly - No Trend
• OBV: Weekly and Monthly - No Trend

In conclusion, NMDC Steel Ltd’s technical landscape is characterised by a cautious optimism amid mixed signals. Investors should balance the mildly bullish momentum against the prevailing bearish undertones and consider their risk appetite carefully before making investment decisions.

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