TCS Shares Poised for Rs 4,400 Surge Amid IT Stock Rally, Says Analyst Rupak De

Tata Consultancy Services (TCS) shares jumped nearly 7% on Friday, and they could soon reach a new 52-week high of Rs 4,400. According to Rupak De, Senior Technical Analyst at LKP Securities, the stock found support on its weekly chart and has broken out of a consolidation phase on the daily chart. This indicates rising optimism around TCS, with short-term support at Rs 4,100.

Pre-Budget Week Trading Strategy

Volatility is expected to increase in the week before the budget announcement. Stocks in budget-sensitive sectors might see more interest, but if the budget doesn’t meet expectations, these stocks could face significant drops. It’s important to avoid leveraged trading and use strict stop losses during this period.

IT Sector Outlook

The IT sector saw a major boost from TCS’s positive earnings, which has renewed optimism. The Nifty IT index shows a consolidation breakout on the daily chart and a cup-and-handle breakout on the monthly chart. This suggests strong short- to medium-term sentiment and the potential for significant gains, which could also lift the overall Nifty index.

TCS Investment Recommendation

Despite the sharp rise on Friday, TCS is not considered overbought. The stock has shown support at the rising trend on the weekly chart and a consolidation breakout on the daily chart. It is expected to move towards Rs 4,400 in the short term, with support at Rs 4,100.

Nifty Bank Performance

Nifty Bank closed the week with a 1% loss but found support at the 21-day EMA. The buy-on-dips strategy is recommended unless the index falls below 21,700. Resistance is at 52,800, and breaking above this level could push the index to 54,000.

Stock-Specific Movements

Earnings news and budget expectations will drive stock-specific movements. Stocks in infrastructure, power, railways, housing, defense, and fertilizers are expected to remain in focus.

Even if many stocks are in the overbought zone, it’s not necessarily a reason to sell them if they continue to show momentum.

RVNL Performance

RVNL had a stellar week and continues to show momentum despite its recent rally. The stock is consolidating, which suggests it is preparing for a longer-term bullish trend.

Top Stock Ideas for the Week

1. Indian Bank
   • Buy at Rs 559
   • Target: Rs 600
   • Stop Loss: Rs 542
   • Reason: Consolidation breakout, positive trend above critical moving average, bullish RSI crossover.
2. BSoft
   • Buy at Rs 731
   • Target: Rs 800
   • Stop Loss: Rs 700
   • Reason: Downward consolidation breakout, positive trend, bullish RSI crossover.
3. IRFC
   • Buy at Rs 216.50
   • Target: Rs 230
   • Stop Loss: Rs 208
   • Reason: Consolidation breakout, positive trend above critical moving average, bullish RSI crossover.