Tata Communications Ltd Technical Momentum Shifts Amid Mixed Indicator Signals

Price Movement and Market Context

On 16 Feb 2026, Tata Communications closed at ₹1,655.20, down from the previous close of ₹1,701.45. The stock traded within a range of ₹1,642.70 to ₹1,701.45 during the day, reflecting volatility amid mixed market sentiment. The 52-week high stands at ₹2,004.00, while the 52-week low is ₹1,293.00, indicating a wide trading band over the past year.

Comparatively, Tata Communications has outperformed the Sensex over longer time horizons. The stock delivered a 1-year return of 8.68%, slightly ahead of the Sensex’s 8.52%. Over five years, the stock’s return of 63.14% surpasses the Sensex’s 60.30%, and its 10-year return of 362.99% significantly outpaces the benchmark’s 259.46%. However, short-term returns have been weaker, with a 1-month decline of 4.73% versus the Sensex’s 1.20% fall, and a year-to-date drop of 9.29% compared to the Sensex’s 3.04% decline.

Technical Trend Shift: Sideways to Mildly Bullish

The technical trend for Tata Communications has recently shifted from a sideways pattern to a mildly bullish one. This transition suggests that the stock may be poised for a gradual upward movement, although the momentum is not yet strong enough to confirm a robust uptrend. The daily moving averages support this view, showing a mildly bullish signal as the stock price remains above short-term averages, indicating some buying interest.

However, the weekly and monthly technical indicators paint a more nuanced picture. The weekly MACD remains bearish, signalling that momentum on a weekly basis is still under pressure. The monthly MACD is mildly bearish, indicating that longer-term momentum has yet to fully recover. Conversely, the weekly RSI is bullish, suggesting that the stock is gaining strength in the short term, while the monthly RSI shows no clear signal, reflecting indecision over the longer horizon.

Momentum Indicators: Mixed Signals

The Bollinger Bands on both weekly and monthly charts are mildly bearish, indicating that the stock price is experiencing some downward pressure and volatility remains elevated. This suggests caution as the price may face resistance near the upper bands, limiting upside potential in the near term.

The KST (Know Sure Thing) indicator shows a bearish signal on the weekly chart but turns mildly bullish on the monthly chart. This divergence implies that while short-term momentum is weak, the longer-term trend may be improving, offering a potential foundation for future gains.

Dow Theory assessments align with this mixed outlook. The weekly Dow Theory is mildly bullish, reflecting tentative confirmation of an upward trend, whereas the monthly Dow Theory shows no clear trend, underscoring uncertainty over the broader timeframe.

On-Balance Volume (OBV) is mildly bearish on the weekly chart and neutral on the monthly chart, indicating that volume trends are not strongly supporting price advances at present. This lack of volume confirmation suggests that any rallies may lack conviction.

Moving Averages and Short-Term Outlook

Daily moving averages provide the most encouraging signals, with the stock price trading slightly above key short-term averages. This mild bullishness suggests that buyers are stepping in at current levels, potentially stabilising the price after recent declines. However, the absence of strong volume support tempers enthusiasm, signalling that any upward moves may be gradual rather than sharp.

Investors should monitor the 50-day and 200-day moving averages closely. A sustained move above these levels could confirm a more robust bullish trend, while failure to hold above them may lead to renewed selling pressure.

Mojo Score and Rating Update

MarketsMOJO has recently downgraded Tata Communications Ltd’s Mojo Grade from Buy to Hold as of 4 Aug 2025, reflecting the tempered technical outlook and mixed momentum signals. The current Mojo Score stands at 65.0, indicating moderate confidence in the stock’s near-term prospects. The Market Cap Grade is 2, signalling a mid-cap status with moderate liquidity and market presence.

This downgrade aligns with the technical indicators’ cautious tone, suggesting investors should adopt a watchful stance rather than aggressive accumulation at this stage.

Investor Takeaway and Strategic Considerations

While Tata Communications exhibits some early signs of technical recovery, the overall picture remains mixed. The mildly bullish daily moving averages and weekly RSI suggest potential for a short-term rebound, but bearish MACD readings and weak volume trends caution against over-optimism.

Investors should weigh the stock’s strong long-term returns against its recent short-term underperformance and technical uncertainty. The stock’s 10-year return of 362.99% versus the Sensex’s 259.46% highlights its historical capacity for wealth creation, but recent volatility and downgrades imply a need for patience and selective entry points.

Monitoring key technical levels such as the 50-day and 200-day moving averages, alongside volume trends and momentum indicators, will be crucial in assessing whether Tata Communications can sustain a bullish reversal or if further consolidation lies ahead.

Given the current Hold rating and Mojo Score of 65.0, investors may consider maintaining existing positions while awaiting clearer technical confirmation before increasing exposure.

Conclusion

Tata Communications Ltd’s technical landscape is characterised by a transition from sideways movement to a cautiously optimistic mildly bullish trend. Mixed signals from MACD, RSI, Bollinger Bands, and volume indicators suggest that while the stock is not yet out of the woods, it is showing tentative signs of stabilisation and potential recovery.

Long-term investors can take comfort from the company’s strong historical returns and fundamental resilience, but short-term traders should remain vigilant to technical developments and volume confirmation before committing to fresh positions.

Overall, Tata Communications remains a stock to watch closely, with a balanced approach recommended amid evolving technical dynamics.

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