SAPPHIRE - Technical Analysis with Chart Patterns & Indicators

Last Updated Time : 20 Dec 25, 03:55 pm

Technical Rating: 2.6

📈 Chart & Trend Analysis:

SAPPHIRE is trading at ₹231, below both its 50 DMA (₹261) and 200 DMA (₹296), indicating a clear bearish trend. RSI at 26.6 suggests oversold conditions, hinting at possible short-term rebound opportunities. MACD at -10.3 is negative, confirming strong bearish momentum. Price is near its 52-week low (₹221), showing heavy downside pressure. Bollinger Bands indicate the stock is hugging the lower band, reflecting persistent weakness. Volume (7.05 lakh) is higher than the weekly average (3.43 lakh), suggesting strong selling activity.

🔑 Momentum Signals:

- RSI oversold at 26.6, potential for short-term bounce.

- MACD negative, confirming bearish continuation.

- Price below both DMAs signals weakness.

- Elevated volume indicates strong selling pressure.

🎯 Entry & Exit Zones:

- Support: ₹221 – ₹225 (near 52-week low).

- Resistance: ₹260 – ₹265 (near 50 DMA).

- Optimal Entry: ₹225 – ₹230 range only for short-term rebound trades.

- Exit/Profit Booking: ₹260 – ₹265 unless trend reversal occurs.

📊 Trend Status:

The stock is reversing downward with strong bearish signals. Oversold RSI may trigger a short-term relief rally, but overall trend remains weak.

Positive

• Stock trading close to oversold levels, potential for technical rebound.
• Book value at ₹38.7 provides some asset backing.
• Industry PE at 123 suggests sector premium, offering long-term potential if fundamentals improve.

Limitation

• Price trading below both 50 DMA and 200 DMA.
• Negative EPS (-₹0.65) reflects weak profitability.
• High debt-to-equity ratio (1.04) increases financial risk.
• Dividend yield is 0.00%, offering no income return.

Company Negative News

• Quarterly PAT declined sharply to -₹17.3 Cr from -₹3.4 Cr.
• FII holdings reduced (-0.24%) and DII holdings reduced (-0.61%).
• Quarterly profit variation at -1,717% shows severe deterioration.

Company Positive News

• Volume spike indicates investor interest, though currently on the sell side.
• Stock trading close to 52-week low may attract value buyers.

Industry

• Industry PE at 123, sector trades at high valuations.
• Peers may be performing better, highlighting SAPPHIRE’s relative weakness.
• Sector premium could support recovery if fundamentals stabilize.

Conclusion

⚠️ SAPPHIRE is in a bearish reversal phase with oversold RSI suggesting possible short-term bounce. Entry near ₹225–₹230 may be considered for rebound trades, while resistance at ₹260–₹265 is critical. Weak fundamentals, negative earnings, and high debt warrant caution, making this a high-risk trade despite potential technical recovery.