Stock watch: Is NMDC likely to zoom?
It was in January 2010 that NMDC Ltd made an all-time high of 322.05. However, it has never seen these levels post that. Over three years, it was moving southwards and it was in August 2013 when it made a low of 55.55. Post this it gave a strong up move giving 132 per cent growth in just a matter of one year by making a high of 128.95. But ever since then, it is trading in a range between 133.65 on the higher end and 52.6 on the lower end forming a rounding bottom like chart pattern. In the month of March 2021 when it gave breakout from the long-term resistance zone of 125-133.65. Having said that, its long-term support is placed at 52.6 levels.
The story doesn’t end here. Post giving a breakout from the crucial resistance zone, it made a high of 213.2 and then the price started moving southwards again. However, the price didn’t breach its resistance turned support zone of 133.65 -125. This indeed depicts that this price zone is quite crucial. Most importantly, on daily charts, the stock made a bullish engulfing candlestick pattern near the above-mentioned important price zone on October 29, 2021. This indicates pullback of price seems to be over and it is likely to head northwards from here. However, 213.2-220 levels would act as its immediate resistance on the upside. If the price successfully breaches these resistance levels, then probably the stock is likely to open doors for further up move.
Above is the monthly chart of NMDC Limited
Looking at its moving average, the stock is presently trading below its 50-Day Exponential Moving Average (EMA), but near its 20-Day EMA. Its Relative Strength Index (RSI) is presently trading at 48 which is above its 20-Day EMA of 45. Even though the Rate of Change (ROC) is presently trading below zero level, it is indeed picking pace. If the ROC moves above zero and subsequently above 10, then the stock would further surge.
At the time of writing, the stock was trading at 144.65.