CERA - Technical Analysis with Chart Patterns & Indicators

Last Updated Time : 20 Dec 25, 03:54 pm

Technical Rating: 3.6

📊 Chart Patterns: CERA is trading below both its 50 DMA (5,683 ₹) and 200 DMA (6,229 ₹), showing bearish undertone. Current price (5,309 ₹) is near support levels, indicating weakness but potential for rebound.

📈 Moving Averages: Price < 50 DMA < 200 DMA → bearish alignment. Trend remains negative until price crosses 5,683–6,229 ₹.

📉 RSI: At 39.4, RSI is in the oversold zone, suggesting potential for short-term bounce.

📉 MACD: Strongly negative (-131), confirming bearish crossover and weak momentum.

📊 Bollinger Bands: Price near lower band, suggesting oversold conditions and possible mean reversion.

📊 Volume Trends: Current volume (22,244) is significantly below 1-week average (40,096), showing lack of strong buying interest and weak participation.

📍 Support & Resistance:

- Strong support: 5,060 ₹

- Immediate resistance: 5,683 ₹ (50 DMA)

- Major resistance: 6,229 ₹ (200 DMA)

🚦 Momentum Signals: Short-term momentum is weak but oversold. Entry zone: 5,100–5,200 ₹ near support. Exit zone: 5,650–5,700 ₹ if resistance is tested.

🔄 Trend Status: The stock is consolidating with bearish bias, oversold but not yet reversing.

Positive

• Strong ROCE (22.4%) and ROE (18.3%) indicate efficient capital use.
• Dividend yield of 1.25% provides income support.
• Low debt-to-equity ratio (0.04) ensures financial stability.
• DII holdings increased (+1.49%), showing strong domestic institutional support.

Limitation

• Stock trading below both 50 DMA and 200 DMA, showing weak technical strength.
• RSI and MACD both indicate bearish momentum.
• Quarterly profit variation (-16.8%) highlights earnings pressure.

Company Negative News

• FII holdings declined (-1.35%), showing reduced foreign investor confidence.
• Quarterly PAT fell to 56.6 Cr. from 46.5 Cr., reflecting earnings weakness.

Company Positive News

• DII holdings increased (+1.49%), reflecting domestic institutional confidence.
• EPS of 182 ₹ supports valuation comfort despite near-term weakness.

Industry

• Industry PE at 28.9 is close to CERA’s PE (29.0), showing fair valuation alignment.
• Building materials and sanitaryware industry benefits from housing and infrastructure demand, though cyclical in nature.

Conclusion

⚖️ CERA is consolidating with bearish bias, trading below key moving averages and showing weak momentum indicators. Entry near 5,100–5,200 ₹ could be considered for short-term gains, with exit around 5,650–5,700 ₹. A breakout above 6,229 ₹ (200 DMA) would confirm reversal. Strong fundamentals and low debt support long-term holding, but near-term weakness due to declining profits and bearish technicals persists.