 "Nifty Auto skids below 100-DMA; Bajaj Auto, Hero Moto can dip another 9%")
The NSE Nifty Auto index plunged 3.5 per cent in intra-day deals on Thursday dragged by key index heavyweights - Bajaj Auto and Hero MotoCorp on lower demand so far this festive season.
As per reports, demand during the current festive season was a tad below expectations; with industry pegged to clock a 3-5 per cent growth.
Shares of Bajaj Auto tumbled 11 per cent, while those of other two-wheeler makers - Hero MotoCorp and TVS Motor Company declined up to 6 per cent each. READ MORE
Thus far in the day, the NSE Nifty Auto index hit a low of 25,004, and was seen quoting around 25,085 levels. In the process, the Nifty Auto index is seen quoting below its 100-DMA (Daily Moving Average) for the first-time since April 12, 2023. Post the breakout, the Auto index witnessed a secular uptrend and peaked at a high of 27,696 - up 117 per cent - on September 27, 2024.
At present levels, the Nifty Auto index has shed 9.4 per cent from its peak and is seen quoting below its 20-, 50- and 100-DMAs. The fall has been severe in the last three trading sessions with the index declining over 5 per cent in this short period.
Against this background, is it time for bargain hunting in the auto sector; or is there more pain ahead? Here's what the technical charts suggest:
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Nifty Auto
Current Level: 25,085
Downside Risk: 7.9%
Support: 24,160
Resistance: 25,550; 25,715
Apart from the downside breakout from the 100-DMA, which stands at 25,550 levels; the Nifty Auto index is also quoting below its 20-WMA (Weekly Moving Average), which stands at 25,715 - for the first-time since April 2023. As such, the near-term bias is likely to remain negative as long as the Auto index trades below these two key pivots.
On the downside, the Nifty Auto index seems on course to test the 200-DMA support at 23,115 levels. Interim support for the index can be expected around 24,160 levels. CLICK HERE FOR THE CHART
Bajaj Auto
Current Price: Rs 10,255
Downside Risk: 9.4%
Support: Rs 10,330
Resistance: Rs 11,135; Rs 11,900
Bajaj Auto stock is seen testing support at its 100-DMA at Rs 10,330 levels. On the daily scale, the price-to-moving average action reveals a favourable structure for the stock. However, Bajaj Auto is witnessing a downside breakout on the weekly scale. Thus, the overall trend for the stock may favour the bears going ahead.
As such, the stock is expected to counter notable resistance around its 50- add the 20-DMA at Rs 11,135 and Rs 11,900 levels in case of a pullback. On the downside, the stock is likely to test its 200-DMA which stands at Rs 9,290 levels. CLICK HERE FOR THE CHART
Hero MotoCorp
Current Price: Rs 5,220
Downside Risk: 9%
Support: Rs 4,955
Resistance: Rs 5,350; Rs 5,485
Hero MotoCorp stock has tumbled over 18 per cent from its peak of Rs 6,426 on September 24. The stock is now seen trading within striking distance of the 200-DMA, which stands at Rs 4,955; below which a test of Rs 4,750 - its 50-WMA seems likely.
The near-term bias is likely to remain negative as long as the stock trades below Rs 5,485; with interim resistance seen at Rs 5,350 levels. CLICK HERE FOR THE CHART
TVS Motor
Current Price: Rs 2,658
Downside Risk: 12.5%
Support: Rs 2,579; Rs 2,445
Resistance: Rs 2,750; Rs 2,800
TVS Motor stock is seen testing its 100-DMA support at Rs 2,579 on the daily scale. The bias at the counter is likely to remain tepid as long as the stock trades below Rs 2,912 levels. Interim resistance for the stock can be expected around Rs 2,750 and Rs 2,800 levels.
In case, the 100-DMA support is violated, TVS Motor stock can extend the fall towards its 200-DMA, which stands at Rs 2,325. Interim support for the stock can be expected around Rs 2,445 levels. CLICK HERE FOR THE CHART
Eicher Motors
Current Price: Rs 4,635
Downside Risk: 8.5%
Support: Rs 4,405; Rs 4,345
Resistance: Rs 4,785; Rs 4,900
Eicher Motors too is seen trading below its 20-, 50- and 100-DMA. Further, the 20-DMA has slipped below the 50-DMA, thus implying that the near-term bias is likely to remain negative.
Chart shows that the bias for Eicher Motors shall be negative as long as the stock trades below Rs 4,900 levels. Interim resistance for the stock is visible at Rs 4,785. On the downside, the stock seems on course to test the weekly super trend line at Rs 4,239; with interim support likely at Rs 4,405 and Rs 4,345 levels. CLICK HERE FOR THE CHART
