Infosys and TCS: Two IT stocks that you can buy today

NIFTY OUTLOOK

Nifty seems to have completed a five waves rising structure from the lows of 9951.90 to 10929.20 and a retracement of the same is expected. The ongoing correction is a part of the same retracement. A minimum of 50% retracement level comes to 10440 levels. On the upside, there is a resistance at 10,700 levels, which is the neckline resistance of the bearish head and shoulders pattern from which it had broken down. The range for the Nifty till the F&O expiry seems to be 10,440-10,700 levels.

STOCKS TO BUY TODAY

TCS

TCS has provided a breakout from an ascending triangular pattern, which is a bullish continuation pattern. The momentum indicator MACD is well in buy mode on the hourly charts. The eekly and monthly patterns also indicate bullish momentum since the last couple of weeks. A fresh breakout with a buy confirmation from the momentum increases the probability of an upside. The short term target is Rs 3670. Maintain stop loss at Rs 3468.

Infosys

Infosys, too, has formed a nice symmetrical triangular pattern that is also a continuation pattern. The stock had an uptrend prior to this consolidation, hence a breakout on the upside can’t be ruled out. The minimum target on the upside is Rs 1,275. Maintain a stop loss at Rs 1,140. The momentum indicator is also well into buy mode, which is a bullish sign going forward.

============================

The author is Jay Anand Thakkar, Assistant Vice President - Equity Research at Anand Rathi.

Disclaimer: He may / may not have positions in the stocks mentioned above