Tata Steel and Adani Enterprises reclaim bullish arena amid market rally as NIFTY50 Crosses 26,000 mark

The moving average is a technical indicator that is widely used by market participants to determine the direction of a trend. Among the moving averages, the 200-day SMA (Simple Moving Average) is popularly followed by market participants to determine the long-term of a stock.

Typically, when the stock is above the 200-SMA, it is considered to be in an uptrend. While the stock cuts the 200-day SMA from below (i.e., the price moves upward through the 200-SMA), it is generally seen as a sign of potential trend reversal from a downtrend to an uptrend. This is often interpreted as a sign that the stock is regaining strength after a period of weakness.

We have covered two stocks from the Nifty500 index. They managed to move above its 200-day SMA on the day when the NIFTY50 index hit a fresh all-time high for the first time and crossed above the level of 26,000 momentarily to close almost flat at 25,940.40.

Here are two stocks which managed to cross and continued to trade above their 200-DMA

Tata Steel Ltd

Tata Steel Limited (TATASTEEL) - 200DMA (Daily: May 23, 2023, September 24, 2024)

On Tuesday, Sept 24,2024, the Nifty Metal index emerged as the top-performing sectoral indices gaining about 3%. Tata Steel a heavyweight stock in the Nifty Metal index climbed over 4% and with this up-move, this Tata Group steel stock managed to reclaim its long-term moving average i.e. 200-day SMA.

It is important to note that the stock opened above its 200-day SMA amid China’s central bank announcing broad monetary stimulus and property market support measures aimed at reviving the economy. The stock closed at an 8-weeks high and 13.74 crore shares changed hands on NSE, which is highest single-day volume in the last six-months. The scrip is up by 5.37% in the month of September and in 2024, it has surged by 17%.

Adani Enterprises Ltd

Adani Enterprises (ADANIENT) - 200DMA (Daily: October 23, 2023, September 24, 2024)

The Gautam Adani-led company, which became part of the SENSEX by replacing Wipro in the index, has been making lower highs since then. However, on Tuesday, shares of Adani Enterprises gained 1.64% and with this up-move, it managed to reclaim its 200-day SMA. The stock after slipping below its 200-day SMA on September 03, 2024, took about 15 trading session to reclaim its 200-day SMA.

The stock has gained 5% in the last three trading sessions. However, the recent up-move in the stock is seen on the back below average volume.

So, from the Nifty500 index Tata Steel and Adani Enterprises are two stocks which managed to reclaim its 200-day SMA on Tuesday and continued to trade above it on Wednesday as well.