Tata Steel Ltd Technical Momentum Shifts Signal Bullish Outlook

Technical Trend Evolution and Momentum Analysis

The technical trend for Tata Steel Ltd has recently upgraded from mildly bullish to bullish, reflecting stronger price momentum and improved market sentiment. The stock closed at ₹181.85 on 2 Jan 2026, up 1.0% from the previous close of ₹180.05. Intraday, it traded between ₹180.25 and ₹182.25, inching closer to its 52-week high of ₹187.00, which underscores the resilience of the current uptrend.

Examining the Moving Average Convergence Divergence (MACD), the monthly chart remains bullish, indicating sustained upward momentum over the longer term. However, the weekly MACD is mildly bearish, suggesting some short-term consolidation or profit-taking. This divergence between weekly and monthly MACD readings points to a healthy correction phase within an overall bullish framework.

The Relative Strength Index (RSI) on both weekly and monthly timeframes currently shows no strong signal, hovering in neutral territory. This implies that the stock is neither overbought nor oversold, providing room for further upward movement without immediate risk of a sharp reversal.

Bollinger Bands and Moving Averages Confirm Strength

Bollinger Bands on both weekly and monthly charts are bullish, with the price consistently trading near the upper band. This suggests strong buying pressure and volatility expansion, often a precursor to continued price appreciation. The daily moving averages also support this view, with the stock price comfortably above its short and medium-term averages, reinforcing the bullish momentum.

The Know Sure Thing (KST) indicator presents a mixed picture: mildly bearish on the weekly scale but bullish monthly. This aligns with the MACD signals and suggests that while short-term momentum may face some resistance, the longer-term trend remains intact and positive.

Volume and Dow Theory Insights

On-Balance Volume (OBV) is mildly bullish on the weekly chart, indicating that volume trends are supporting price gains. However, the monthly OBV shows no clear trend, signalling that longer-term volume confirmation is still developing. According to Dow Theory, the weekly trend is mildly bullish, but the monthly trend is mildly bearish, reflecting a cautious stance among investors over the medium term despite recent gains.

Comparative Performance and Market Context

Tata Steel Ltd’s recent price momentum is further validated by its impressive returns relative to the broader Sensex index. Over the past week, the stock surged 6.97%, while the Sensex declined marginally by 0.26%. The one-month return for Tata Steel stands at 7.83%, contrasting with a 0.53% drop in the Sensex. Year-to-date, the stock has gained 1.00%, slightly outperforming the Sensex’s 0.04% decline.

Longer-term returns are even more compelling. Over one year, Tata Steel has delivered a robust 32.98% gain compared to the Sensex’s 8.51%. Over three years, the stock’s return of 61.43% significantly outpaces the Sensex’s 40.02%. The five-year and ten-year returns are particularly striking, with Tata Steel appreciating 182.77% and 641.80% respectively, dwarfing the Sensex’s 77.96% and 225.63% gains. These figures highlight the company’s strong fundamental and technical positioning within the ferrous metals sector.

Mojo Score Upgrade and Market Capitalisation Insights

Reflecting the positive technical and fundamental outlook, Tata Steel Ltd’s Mojo Score has been upgraded to 84.0, earning a “Strong Buy” grade as of 1 Jan 2026, up from a previous “Buy” rating. This upgrade underscores increased confidence in the stock’s potential to deliver superior returns. The company holds a Market Cap Grade of 1, indicating its status as a large-cap leader within the ferrous metals industry.

Such a rating upgrade typically attracts institutional interest and can act as a catalyst for further price appreciation, especially when combined with the bullish technical signals currently observed.

Investor Implications and Outlook

For investors, the current technical landscape of Tata Steel Ltd suggests a favourable entry point supported by strong momentum indicators and a positive upgrade in expert ratings. The bullish signals from moving averages and Bollinger Bands, combined with the monthly MACD and KST indicators, point to sustained upward potential.

However, the mildly bearish weekly MACD and KST, along with neutral RSI readings, advise caution for short-term traders as minor pullbacks or consolidation phases may occur. The stock’s proximity to its 52-week high at ₹187.00 also warrants monitoring for potential resistance levels.

Overall, Tata Steel’s technical parameters, coupled with its impressive relative returns and upgraded Mojo Grade, position it as a compelling candidate for investors seeking exposure to the ferrous metals sector with a medium to long-term horizon.

Summary of Key Technical Indicators:

• MACD: Weekly mildly bearish; Monthly bullish


• RSI: Neutral on weekly and monthly charts


• Bollinger Bands: Bullish on weekly and monthly


• Moving Averages: Daily bullish


• KST: Weekly mildly bearish; Monthly bullish


• Dow Theory: Weekly mildly bullish; Monthly mildly bearish


• OBV: Weekly mildly bullish; Monthly no trend

Price and Volume Context: Current price ₹181.85, 52-week range ₹122.60–₹187.00, daily volume trends supportive of price gains.

Long-Term Performance vs Sensex: Tata Steel’s 10-year return of 641.80% far exceeds Sensex’s 225.63%, highlighting its strong growth trajectory.

Mojo Score and Grade: Upgraded to 84.0 (Strong Buy) from Buy on 1 Jan 2026, reflecting enhanced confidence in the stock’s prospects.

Conclusion: Tata Steel Ltd’s technical momentum shift to a bullish stance, combined with strong fundamental backing and market outperformance, makes it a noteworthy stock for investors seeking growth in the ferrous metals sector. While short-term caution is advised due to mixed weekly signals, the overall outlook remains positive for sustained gains.

Only Rs. 9,999 - Get MojoOne + Stock of the Week for 1 Year (MRP = Rs. 34,999) Start Saving Now →