Zen Technologies shares have faced a sharp correction, falling 14% in the morning session on January 28, 2025. This brings its six-day decline to 32.20%, following a high of ₹2,627.95 on December 24, 2024. The recent sell-off comes despite an upgrade in the company’s credit ratings by CRISIL Ratings.
The stock’s current price of ₹1,495.10 places it below key moving averages (5-day, 10-day, 20-day, 50-day, 100-day, and 200-day), indicating a bearish trend. Additionally, its Relative Strength Index (RSI) of 25.8 signals an oversold condition, raising questions about whether it is the right time to buy, hold, or sell the stock.
What Do Analysts Say About Zen Technologies’ Price Action?
- Kushal Gandhi (StoxBox):
- Analysis: Zen Technologies is experiencing profit booking pressure after a 1700% rise since May 2022. The stock broke down from an inverted cup and handle pattern, breaching its 200 DMA.
- Recommendation: Continued selling pressure is expected; sell at current market levels.
- AR Ramachandran (Independent Analyst):
- Analysis: The stock is oversold but bearish on daily charts, with key support at ₹1,341.
- Recommendation: Only buy if the daily close is above ₹1,760, targeting ₹2,282 in the near term.
- Hardik Matalia (Choice Broking):
- Analysis: Zen Technologies trades below all major moving averages, with RSI indicating an oversold zone. A breach of the ₹1,450 support level could push the stock further to ₹1,300–₹1,200.
- Recommendation: Avoid fresh long positions until the stock breaks above ₹1,800 with momentum and volume support.
Key Technical Indicators
- 52-Week Range: ₹762.65 – ₹2,627.95.
- Current Price: ₹1,495.10.
- RSI (Relative Strength Index): 25.8, indicating oversold conditions.
- Beta (Volatility): 1.0, suggesting average volatility.
- Moving Averages: Trading below 5-day, 10-day, 20-day, 50-day, 100-day, and 200-day averages.
What Are the Potential Scenarios for Zen Technologies?
- Bearish Continuation:
If the stock breaches the ₹1,450 support level, analysts predict a decline to the ₹1,300–₹1,200 range. Weak buyer demand and bearish momentum reinforce this scenario. - Technical Bounce:
Oversold conditions (RSI at 25.8) may trigger a short-term bounce. However, this is unlikely to signal a reversal without strong volume and momentum. Analysts recommend using any bounce as an opportunity to exit existing holdings. - Reversal Confirmation:
A sustained breakout above ₹1,800, supported by increased volumes and momentum indicators, would signal a reversal, making it safer for investors to re-enter.
Company Overview: Zen Technologies
Zen Technologies specializes in defence training systems, manufacturing products like land-based military training simulators, anti-drone systems, and live range equipment. Its flagship Anti-Drone System (ZADS) uses advanced technology for drone detection and neutralization. The company operates a training platform in Hyderabad, showcasing its complete product range.
Should You Buy, Hold, or Sell Zen Technologies Shares?
Sell:
- For short-term traders, the bearish trend and breach of key support levels indicate further downside risk. Analysts recommend selling the stock until it stabilizes above ₹1,800.
Hold:
- Investors with long-term goals should monitor key support levels at ₹1,450 and ₹1,341. If these hold, the stock could see recovery after the current corrective phase.
Buy:
- New investments should be avoided unless the stock confirms a trend reversal with a strong breakout above ₹1,800, supported by positive RSI and volume patterns.
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