Technical analysts see bearish sentiments for CDSL as the stock corrected from its recent highs.

What Happened: CDSL raced to its all-time high level on the back of its bonus share issue buzz. CDSL shares reached an all-time high of ₹1664.45 on August 23, one day before the record date of the 1:1 bonus stare issue.

Since then the stock has fallen almost 12%. The market infrastructure firm was also slapped with a ₹10 lakh fine by the market regulator SEBI due to failure to comply with SEBI's cybersecurity policies and guidelines.

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Technical Views: Jigar S Patel, senior manager – technical research analyst, Anand Rathi Shares and Stock Brokers said, the recent correction has caused the stock to fall below 20 day exponential moving average, an important technical indicator to assess short to medium term price trends. The breakdown below the trend suggests weak momentum and short term bearish sentiment, he added.

“Looking forward, the next key support zone is anticipated between the 1300-1325 levels, which has historically been a demand area. In this zone, past buying activity had lifted the stock, making it a crucial level to watch. This area also coincides with the 50-day Exponential Moving Average (DEMA), adding further significance as a potential support level. If the stock stabilizes here, it may see renewed buying interest.”, Patel added.

Manish shah, independent Market Analyst ( SEBI registered) said, “The price action in CDSL is in a deep correction mode. Price has broken below the support at 1400 and it is in a strong momentum decline. Expect the price to drop lower towards 1250-1260 over next couple of weeks. As long as price trades below 1425. The intermediate-term trend is in a decline.”

Price Action: Shares of CDSL was up 0.75% to ₹1,369.45 on Thursday afternoon.

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