Tuesday, 19 March 2013

IT sector outlook for near term

CNX IT has rallied from 6000 - 7400 odd levels in this year. It is forming a small topping out pattern in the form of bearish triangle. The correction can be expected in near term with the bearish divergence in price and technical indicators. A minor distribution pattern is seen in the index as well as major stocks.



                                                         CNX IT Daily chart


It is advisable for long traders or investors to exit long positions and wait for dips in the stocks and index. After a long rally one can exit with stellar profits. The short term traders can initiate short positions in the index below 7100 with targets of 6700 odd levels in short term.

HCL Technologies

HCL saw a distribution around 800 odd levels. It will not be able to sustain higher levels. One can short with a closing stop of 810 odd levels with targets of 772 below can see lower levels of 7 _ _.


                                                HCL Techologies Daily chart

Infosys

Infosys rallied from 2250 - 3000 levels after 3rd quarter results now forming a minor top. It is formed a bearish engulfing kind of a pattern. On upper side 2912 can act as a immediate resistance and 2750 - 2800 as a strong support levels. Although the stock looks bearish in near term but there are strong support zone as mentioned on 2750 - 2800 and resistance at 2900. The break below can create further inroads in the counter. So stock can trade in the range of 2750 - 2900 in the near term.


                                                        Infosys Daily Chart
                                           

TCS

TCS is performing same as the CNX IT index. The counter is in the verge of a bearish triangle breakdown. The break below 15 _ _ can test 15 _ _ and 14 _ _. As we have suggested in our previous blog to exit long positions in TCS around 1580 - 1590 odd levels. Its better to avoid than going short on the counter before breakdown is confirmed.


                                                          TCS Daily chart

For more detailed update on TCS can visit our previous blog.

 http://stbta.blogspot.in/2013/03/tcs-short-term-investors-can-exit.html


Raju V Angadi
 Equity Research Analyst
 Fortuna Financial Boutique (FFB)
 Bangalore, India.

To know more about probable counts contact us back of http://fortunfin.com/contact-us or e-mail us on research@fortunfin.com.


Disclaimer: This is just an view based on the research of individual. So kindly trade along with the consultation of your financial adviser, market trends, price action and own risk appetite considered while investing or trading in stock markets.



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