How to trade Titan, other jewellery stocks amid rising Gold prices?

Stocks like PC Jeweller, TBZ, Kalyan Jewellers and Senco Gold can potentially rally up to 27% from current levels, suggest technical charts.

Stocks of Gold retailers like – PC Jeweller, RBZ Jewellers, Tribhovandas Bhimji Zaveri (TBZ) and Motisons Jewellers have soared in the range of 27-39 per cent in the last one month, post the Union Budget 2024. Among others, Titan has rallied 7 per cent; while Kalyan Jewellers and Thangamayil Jewellery rose 4 per cent and 2 per cent, respectively. 

The sharp rally in Gold-related stock prices was triggered after the Finance Minister Nirmala Sitharaman announced a cut in custom duty on Gold and Silver to 6 per cent from 15 per cent.

On the MCX, Indian traded Gold futures tumbled from levels of Rs 72,718 on July 22, 2024 (day prior to the Union Budget) to a low of Rs 67,400 on July 25, 2024 – down 7.3 per cent in just three trading sessions. 

 

The sharp drop in physical Gold prices came as a sigh of relief to both for Gold buyers and Gold retailers. Analysts believe that retail sales would go up post the customs duty cut. Hence, stock prices of Gold jewellery makers gained in the following period.

However, post July 25, Gold prices have ascended in international market, thereby seeing a corresponding increase in the Indian Gold market too. International Gold prices were seen quoting at record high levels of $2,550 per ounce as bets of a September interest rate cut in the US rose.

Correspondingly, the MCX Gold prices have rallied back to Rs 71,700 levels – thus in a way, undoing the benefit of decline in prices post the Budget customs duty cut.

Given this background, what should be your strategy towards stocks of Gold retailers – Should you Buy at present levels or wait for dips? Here's what the charts suggest.

Titan

Last Price: Rs 3,465

Upside Potential: 8.8%

Support: Rs 3,185

Resistance: Rs 3,508; Rs 3,640

Titan has been a relative underperformer among peers in the post Budget rally. On the charts, the stock is seen struggling to regain strength following the break of its 200-DMA (Daily Moving Average) support in May 2024.

At present levels, the stock is once again seen attempting to break above the 200-DMA hurdle, which now stands at Rs 3,508. The price-to-moving averages action and the key momentum oscillators are all displaying mixed signals for Titan. Hence, the stock is likely to consolidate in the near-term before embarking on a decisive trend. CLICK HERE FOR THE CHART

For now, the weekly chart suggests, that the upside for the stock may be capped around Rs 3,770 levels; with interim resistance seen at Rs 3,640. On the downside, the monthly chart shows presence of strong support around Rs 3,185 and Rs 3,020 range. Hence, the stock may gyrate in the broad range of Rs 3,020 - Rs 3,770 until a clear directional move takes place.

Senco Gold

Last Price: Rs 1,109

Upside Potential: 12.3%

Support: Rs 1,015

Resistance: Rs 1,155

Senco Gold is seen trading around its bullish pivot on the daily scale, which stands at Rs 1,110. The stock will need to sustain above the same for the bias to remain favourable. On the upside, the stock needs to break and trade consistently above Rs 1,155 levels for gaining fresh upside momentum. The stock can potentially target Rs 1,245 on the higher side.

On the other hand, in case, the stock trades consistently below Rs 1,110 levels, it can potentially dip to Rs 1,015 levels. CLICK HERE FOR THE CHART

PC Jeweller

Last Price: Rs 98

Upside Potential: 27.5%

Support: Rs 88.50; Rs 86

Resistance: Rs 102.50; Rs 105.50

PC Jeweller stock is seen trading with a positive bias on the daily scale; post the breakout in early July. The stock is consistently seen making higher-highs and higher lows. At current levels, the chart shows presence of near resistance for the stock at Rs 102.50 and Rs 105.50 levels; above which the stock can potentially soar to Rs 125 levels.

The overall, bias for the stock is likely to remain upbeat as long as the stock holds above Rs 86 on a monthly closing basis. Interim support for the stock is seen at Rs 88.50. CLICK HERE FOR THE CHART

Kalyan Jewellers

Last Price: Rs 550

Upside Potential: 14.5%

Support: Rs 525

Resistance: Rs 580; Rs 590

Kalyan Jewellers stock seems to have entered a phase of consolidation post the recent rally. The stock is likely to consolidate in the broad range of Rs 630 - Rs 480; with interim support seen at Rs 525 and resistance likely around Rs 580 - Rs 590 levels. CLICK HERE FOR THE CHART 

Tribhovandas Bhimji Zaveri (TBZ)

Last Price: Rs 182

Upside Potential: 18.1%

Support: Rs 175; Rs 168

Resistance: Rs 196

TBZ stock is seen making higher-highs and higher-lows on the daily chart. The stock at present is seen trending along the higher-end of the Bollinger Bands on the daily scale. 

The overall bias for the stock is likely to remain bullish as long as it holds above Rs 168; shows the monthly chart. Strong support for the stock can be expected around Rs 175 levels. On the upside, the stock can potentially rally to Rs 215 levels, with interim resistance likely around Rs 196. CLICK HERE FOR THE CHART