Price Movement and Market Context
On 2 Feb 2026, Paras Defence closed at ₹653.70, down sharply by 8.27% from the previous close of ₹712.60. The intraday range was wide, with a high of ₹735.00 and a low of ₹625.05, reflecting heightened volatility. This decline comes despite the stock’s strong longer-term performance, having delivered a 23.03% return over the past year and an impressive 143.99% over three years, significantly outperforming the Sensex’s 5.16% and 35.67% returns respectively over the same periods.
However, the recent price weakness contrasts with the stock’s 52-week high of ₹971.80 and suggests a correction phase after a strong rally. The 52-week low stands at ₹401.00, indicating that while the stock remains well above its lows, the current technical signals warrant close attention.
Technical Indicators Signal Bearish Shift
The technical trend for Paras Defence has shifted from mildly bearish to outright bearish, reflecting a deterioration in momentum across multiple timeframes. The Moving Average Convergence Divergence (MACD) indicator, a key momentum oscillator, is bearish on the weekly chart and mildly bearish on the monthly chart. This suggests that the short-term momentum is weakening more rapidly than the longer-term trend, which is only mildly negative.
The Relative Strength Index (RSI) on the weekly timeframe is also bearish, indicating that the stock is losing upward momentum and may be entering oversold territory if the trend continues. The monthly RSI, however, currently shows no clear signal, implying that the longer-term momentum remains neutral but vulnerable to further deterioration.
Moving averages on the daily chart confirm the bearish stance, with the stock trading below key averages, signalling sustained selling pressure. The KST (Know Sure Thing) indicator, which aggregates multiple momentum cycles, is bearish on the weekly chart and mildly bearish on the monthly chart, reinforcing the negative momentum across different time horizons.
Bollinger Bands and Volume Trends
Bollinger Bands on the weekly chart are bearish, with the price moving towards the lower band, indicating increased volatility and potential continuation of the downtrend. Interestingly, the monthly Bollinger Bands show a mildly bullish signal, suggesting that despite short-term weakness, the stock may still have some underlying support in the longer term.
On-Balance Volume (OBV) readings for both weekly and monthly periods show no clear trend, indicating that volume is not decisively confirming the price movement. This lack of volume confirmation could imply that the recent price decline is driven more by short-term traders rather than a broad-based sell-off by institutional investors.
Strong fundamentals, solid momentum, fair price – This Large Cap from the NBFC sector checks every box for our Top 1%. This should definitely be on your radar!
- - Complete fundamentals package
- - Technical momentum confirmed
- - Reasonable valuation entry
Dow Theory and Broader Trend Analysis
According to Dow Theory, the weekly trend for Paras Defence is mildly bullish, suggesting some resilience in the short term. However, the monthly Dow Theory reading is mildly bearish, indicating that the broader trend is under pressure. This divergence between weekly and monthly signals highlights the stock’s current technical uncertainty and the potential for further downside if the monthly bearish trend asserts itself.
The company’s market capitalisation grade stands at 3, reflecting a mid-tier valuation relative to its peers in the aerospace and defence sector. The overall Mojo Score of 36.0 and a Mojo Grade of Sell, downgraded from Hold on 5 Jan 2026, further underline the cautious stance recommended by technical analysis experts.
Comparative Performance Versus Sensex
Despite the recent technical weakness, Paras Defence has outperformed the Sensex over multiple timeframes. The stock posted a 4.81% gain over the past week compared to a 1.00% decline in the Sensex, though it has slipped 3.77% over the past month versus the Sensex’s 4.67% fall. Year-to-date, the stock is down 4.49%, slightly better than the Sensex’s 5.28% decline. Over longer horizons, Paras Defence’s returns remain robust, with a 23.03% gain over one year and a remarkable 143.99% over three years, far exceeding the Sensex’s 5.16% and 35.67% respectively.
This outperformance reflects the company’s strong fundamentals and growth prospects in the aerospace and defence sector, despite the current technical headwinds.
Holding Paras Defence and Space Technologies Ltd from Aerospace & Defense? See if there's a smarter choice! SwitchER compares it with peers and suggests superior options across market caps and sectors!
- - Peer comparison ready
- - Superior options identified
- - Cross market-cap analysis
Investor Implications and Outlook
For investors, the current technical deterioration in Paras Defence’s stock price suggests caution. The bearish signals from MACD, RSI, and moving averages indicate that the stock may face further downside pressure in the near term. The lack of volume confirmation on OBV adds to the uncertainty, implying that the recent sell-off may not yet be supported by strong institutional participation.
However, the stock’s strong long-term returns and relative outperformance versus the Sensex highlight its underlying strength and growth potential. Investors with a longer-term horizon may view the current weakness as a potential buying opportunity, provided they monitor technical indicators closely for signs of a reversal.
Market participants should also consider the broader aerospace and defence sector dynamics, which remain influenced by geopolitical developments and government defence spending. Paras Defence’s mid-tier market cap and recent downgrade to a Sell grade by MarketsMOJO reflect a cautious stance but do not negate the company’s fundamental prospects.
Summary of Technical Ratings
To summarise the technical landscape:
- MACD: Weekly Bearish, Monthly Mildly Bearish
- RSI: Weekly Bearish, Monthly Neutral
- Bollinger Bands: Weekly Bearish, Monthly Mildly Bullish
- Moving Averages: Daily Bearish
- KST: Weekly Bearish, Monthly Mildly Bearish
- Dow Theory: Weekly Mildly Bullish, Monthly Mildly Bearish
- OBV: No clear trend on weekly or monthly
These mixed signals underscore the importance of monitoring both short- and long-term technical indicators before making investment decisions.
Conclusion
Paras Defence and Space Technologies Ltd is currently navigating a challenging technical environment marked by bearish momentum and weakening price action. While the stock’s long-term fundamentals and returns remain strong, the recent downgrade in technical grade to Sell and the negative signals from key indicators suggest that investors should exercise prudence. Close attention to evolving technical trends and sector developments will be essential for those considering exposure to this aerospace and defence player.
Unlock special upgrade rates for a limited period. Start Saving Now →
