By Kiran Jani
The cement sector, which has been on a downward trend for the past nine months, is finally showing signs of recovery. With prices stabilizing and the broader market improving, certain stocks are starting to indicate potential for a turnaround.
Ambuja Cement and ACC
In particular, these two stocks have formed reversal patterns that suggest opportunities for traders and investors.
Ambuja Cement – A Bullish Reversal emerging
Ambuja Cement experienced a sharp 35% decline from its peak in July 2024, dropping from ₹706 to ₹455. However, a significant rebound from these lower levels points to renewed investor interest and the possibility of a trend reversal.
Key indicators supporting Ambuja Cement’s strength:
- Breakout from Falling Trendline: The stock has recently broken above a long-term descending trendline, reinforcing bullish sentiment.
- 100-SMA Crossover: The stock price is now trading above its 100-day Simple Moving Average (SMA) for the first time since October 2024, signalling a potential shift in trend.
- Volume Surge Confirming the Breakout: An increase in both price and trading volume suggests strong market participation, validating the upward momentum.
- Strengthening RSI Momentum: The 14-period Relative Strength Index (RSI) is above 60, indicating bullish divergence and pointing to further potential upside.
Outlook: Ambuja Cement Limited
Ambuja Cement Limited saw a strong 73% return from October 2023 to July 2024. However, the stock has been in a correction phase recently, dropping from ₹706 to ₹455 over the past nine months. There are now early signs of a possible recovery. The stock has broken above a long-term downward trendline and is trading above the 100-day Simple Moving Average (SMA), with rising volume. These are key indicators that often suggest the stock may be preparing for an upward move.
ACC – Bullish Reversal in play
ACC experienced a 37% decline from July 2024 to February 2025. However, the stock is showing early signs of a potential reversal, with bullish signals appearing on the daily chart. This suggests a possible shift in trend.
Key technical indicators:
- Falling trendline breakout – The stock has broken out from key long term falling trending, reinforcing bullish sentiment.
- 50-SMA Crossover – The stock price is trading above its 50-day Simple Moving Average (SMA) for the first time since October 2024, signalling a potential trend shift.
- Volume Surge Confirming Breakout – A simultaneous rise in price and volume suggests strong participation, validating the upward momentum.
- Strengthening RSI Momentum – The 14-period Relative Strength Index (RSI) above 60 indicates bullish divergence, pointing to further upside potential.
Outlook: ACC
ACC stock generated a strong 57% return from December 2023 to July 2024. However, the past nine months have been challenging, with the stock falling from ₹2,844 to ₹1,778. Recently, technical signals suggest a potential change in momentum. The stock has broken above a key trendline, a classic sign of accumulation and a possible trend reversal. Additionally, the 14-period RSI has entered the bullish zone, indicating improving momentum.
Final take
With strong reversal signals in play, both Ambuja Cement and ACC are showing early signs of a potential comeback. Their bullish chart patterns, rising RSI, and key technical breakouts suggest that momentum is building. While market volatility remains a consideration, these stocks may potentially offer attractive upside opportunities.
Monitoring key resistance levels and confirmation signals will be essential, as the next move could be just around the corner.
Disclaimer
Note: The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
As per SEBI guidelines, the writer and his dependents may or may not hold the stocks/commodities/cryptos/any other assets discussed here. However, clients of Jainam Broking Limited may or may not own these securities.
Kiran Jani has over 15 years of experience as a trader and technical analyst in India’s financial markets. He is a well-known face on the business channels as Market Experts and has worked with Asit C Mehta, Kotak Commodities, and Axis Securities. Presently, he is Head of the Technical and Derivative Research Desk at Jainam Broking Limited.
Disclosure: The writer and his dependents do not hold the stocks discussed here. However, clients of Jainam Broking Limited may or may not own these securities.
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