Trade Spotlight: What should investors do with TCS, HCL Technologies, Infosys?

D-Street witnessed gains for the sixth consecutive day in a row on Thursday which pushed the market to a fresh 7-month high. The S&P BSE Sensex reclaimed 40,000 while the Nifty50 closed above 11,800 levels.

Let’s look at the final tally on D-Street on Thursday – the S&P BSE Sensex witnessed profit booking at higher levels but still closed with gains of more than 300 points at 40,182 while the Nifty50 rose 95 points to close at 11,834.

Sectorally, the action was seen in IT, Healthcare, Telecom, and Bankex while the selling pressure was seen in Energy, Oil & Gas, and Capital Goods stocks.

TCS rose over 3 percent to hit a high of Rs 2885, HCL Tech also hit a 52-week high of Rs 878.80, and Infosys closed with gains of over 2 percent on Thursday.

We have collated views of experts on what investors should do when the market resumes trading on Friday, October 9:

Expert: Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities

TCS: Positional traders retain an optimistic stance

On October 8, the stock registered yet another all-time high of Rs 2885. This month so far, TCS has rallied over 21 percent. The important point is that the stock not only surpassed its previous resistance of Rs 2565 but comfortably managed sustained above the same.

The sharp price surge post-breakout clearly suggests that bulls are in total control and the uptrend texture will continue in the near future.

On the daily as well as weekly charts, the stock has formed a breakout continuation pattern which is grossly positive for TCS.

Infosys: Rs 1040 would be the trend decider level for positional traders

On Thursday, the stock made another all-time high of Rs 1124. The short term trend of Infosys is extremely strong. The stock has rallied from Rs 900 to Rs 1100 within a very short period of time.

That rally was price dominating and supported with modest volume activity. On the daily and weekly charts, the stock has formed Higher High and Higher Low series pattern which suggests uptrend momentum likely to persist in the near future.

For the positional traders, Rs 1040 would be the trend decider level. Trading above the same then we can expect further uptrend up to Rs 1150-1200. However, on a close below Rs 1040, traders may prefer to exit from trading long positions.

HCL Technologies: For swing traders, Rs 805 should be the sacrosanct level

On Thursday, the stock opened with a gap-up and quickly rallied over 5 percent, but in the late afternoon, it trimmed some gains and finally closed near Rs 850 level.

However, the medium-term texture of the stock is robust. On the daily charts, it has formed a strong range breakout pattern. The structure suggests breakout action will continue in the near term if the stock succeeds to trade above Rs 805 level.

For swing traders Rs 805 should be the sacrosanct level, trading above the same we can expect an uptrend continuation wave up to Rs 935.