Technical Trend and Price Movement Overview
SpiceJet’s current share price stands at ₹32.79, down from the previous close of ₹33.32, with intraday fluctuations ranging between ₹32.51 and ₹33.80. The stock’s 52-week high is ₹61.99, while the low is ₹28.13, indicating a wide trading range over the past year. The recent daily change of -1.59% underscores the ongoing pressure on the stock amid broader market dynamics.
The technical trend has shifted from mildly bearish to bearish, signalling a more cautious stance among market participants. This shift is corroborated by the daily moving averages, which currently indicate a bearish pattern, suggesting that short-term price momentum is under pressure.
MACD and Momentum Indicators
The Moving Average Convergence Divergence (MACD) indicator presents a nuanced picture. On a weekly basis, the MACD remains mildly bullish, hinting at some underlying positive momentum in the medium term. However, the monthly MACD is bearish, reflecting longer-term downward pressure on the stock. This divergence between weekly and monthly MACD readings suggests that while short-term momentum may offer some relief, the broader trend remains subdued.
Relative Strength Index (RSI) and Bollinger Bands
The RSI readings for both weekly and monthly periods do not currently generate a clear signal, indicating that the stock is neither overbought nor oversold at these timeframes. This neutral RSI stance implies that the stock’s price movements are not yet extreme enough to trigger momentum-based reversals.
Bollinger Bands add further context, with weekly readings mildly bearish and monthly readings bearish. The contraction or expansion of these bands often signals volatility shifts, and the current bearish orientation suggests that price volatility may be skewed towards downside risk in the medium to long term.
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Moving Averages and KST Analysis
Daily moving averages for SpiceJet are currently bearish, reinforcing the short-term downtrend in price momentum. This suggests that recent price action has been unable to sustain upward movement, with sellers exerting more influence in the market.
The Know Sure Thing (KST) indicator offers a mixed view: weekly readings are mildly bullish, indicating some positive momentum in the near term, while monthly readings are bearish, aligning with the longer-term downtrend. This divergence highlights the complexity of the stock’s momentum profile, where short-term optimism is tempered by broader caution.
Dow Theory and On-Balance Volume (OBV)
According to Dow Theory, weekly signals are mildly bearish, whereas monthly signals lean mildly bullish. This contrast suggests that while the immediate trend may be under pressure, the longer-term market assessment retains some positive elements. However, the absence of clear OBV signals for both weekly and monthly periods limits insights into volume-driven price trends, leaving some uncertainty about the strength behind recent price moves.
Comparative Performance Against Sensex
SpiceJet’s returns over various periods reveal a challenging performance relative to the broader market. Over the past week, the stock recorded a 5.40% return, outperforming the Sensex’s -0.52% return. However, this short-term gain contrasts sharply with longer-term results. Over one month, SpiceJet’s return was -7.58%, while the Sensex gained 0.95%. Year-to-date, SpiceJet’s return stands at -40.81%, compared to the Sensex’s 9.12% gain.
Over one year, SpiceJet’s return is -43.26%, whereas the Sensex posted 4.89%. The three-year and five-year returns for SpiceJet are -19.04% and -69.11%, respectively, while the Sensex recorded 37.24% and 84.97% over the same periods. Even over a decade, SpiceJet’s return of -48.52% contrasts with the Sensex’s robust 240.47%. These figures underscore the stock’s relative underperformance amid broader market gains.
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Sector and Market Context
SpiceJet operates within the airline industry, a sector often sensitive to macroeconomic factors such as fuel prices, regulatory changes, and travel demand fluctuations. The current technical signals reflect these sectoral challenges, with the stock’s bearish momentum aligning with broader industry pressures. Investors should consider these dynamics alongside technical indicators when assessing the stock’s outlook.
Summary of Technical Assessment
The recent revision in SpiceJet’s evaluation metrics highlights a shift towards a more cautious market assessment. The interplay of mildly bullish weekly indicators and bearish monthly signals suggests that while short-term price momentum may offer some opportunities, the longer-term trend remains under pressure. The absence of strong RSI signals and mixed Dow Theory readings further emphasise the need for careful analysis before making investment decisions.
Given the stock’s relative underperformance compared to the Sensex across multiple timeframes, investors may wish to weigh the technical momentum shifts against fundamental and sectoral factors. The current price near the lower end of its 52-week range adds to the complexity of the investment case.
Looking Ahead
Market participants should monitor key technical indicators such as MACD, moving averages, and Bollinger Bands for confirmation of trend direction. Any sustained change in these parameters could signal a shift in momentum that may influence SpiceJet’s price trajectory. Additionally, broader market and sector developments will continue to play a critical role in shaping investor sentiment towards the airline stock.
Conclusion
SpiceJet’s technical momentum reflects a nuanced scenario where short-term mildly bullish signals coexist with longer-term bearish trends. The stock’s performance relative to the Sensex underscores the challenges faced by the airline amid evolving market conditions. Investors are advised to consider these technical insights alongside fundamental analysis and sector outlooks to form a comprehensive view of the stock’s prospects.
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