Technical view: Nifty Metal

The index is seeing a strong price action, which is backed by bullish technical parameters.

Nifty Metal index is designed to reflect the behaviour and performance of the metals sector. The index comprises 15 metal stocks, having the highest market capitalisation in the market. Tata Steel, Hindalco, and JSW Steel are some of the index heavyweights, which constitute over 60 per cent weightage in the index.  

Nifty Metal has been extremely bullish lately as it gained nearly 11 per cent in just 18 trading sessions. The sectoral index has outperformed the broader market and Nifty by a huge margin in the past few weeks. It has gained nearly 10 per cent this year as against 1 per cent of Nifty during the same period.  

With such strong momentum, the index has taken out the prior swing high and is just 3.9 per cent less its all-time high. The difference between the short-term 20-day moving average and spot price is over 5 per cent, which justifies its strong upside momentum. The 14-period daily RSI is placed at 68 and has crossed above its prior swing high. The trend indicator ADX is rising, which indicates a strong uptrend of the index. The MACD is above the zero line and signal line and demonstrates strong bullishness of the index.   

The index is seeing a strong price action, which is backed by bullish technical parameters. With this, the index is expected to surge in the times to come.