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Tech Mahindra Technical Analysis #22: Buy | Target Rs 840 | Arijit Banerjee

OUR RECOMMENDATION

CMP#811.35
IdeaBUY
Buy Range780 – 800
Target850 – 860
StopLoss*775
Duration12 – 15 Trading Sessions
Potential Return^5 – 6%
CMP#IdeaBuy RangeTargetStopLoss*DurationPotential Return^
811.35BUY780 – 800850 – 86077512 – 15 Trading Sessions5 – 6%

# CMP on Feb 6, 2019
* Maintain recommended StopLoss by daily closing basis.
   Once 1st target hit, reset StopLoss at 826.
^ The returns are calculated based on CMP#

COMPANY OVERVIEW

Tech Mahindra Ltd, an IT services and consulting company in India engaged in the business of computer programming, consultancy and related services. The Company offers Information Technology (IT) Services and Business Processing Outsourcing (BPO) and helps clients across the healthcare, manufacturing, energy, natural resources, utilities, financial services, telecom and retail industry verticals. For the quarter ended 31-12-2018, the company has reported a Net profit after tax of 1220 Crore as against net profit of Rs.924.4 crore in the corresponding period last year.

Stock Data
NSE CodeTECHM
Sectoral IndexNIFTY IT
52W High814.5
52W Low563.65
Face Value5
Relative Performance_Tech Mahindra vs Nifty IT

TECHNICAL OBSERVATIONS (WEEKLY)

  • The stock formed well defined Symmetrical Triangle Pattern over the last 6 months and a breakout above the upper side shows further bullishness.
  • Volumes have gone up along with price rise.
Tech Mahindra Weekly Chart
Tech Mahindra Weekly Chart

TECHNICAL OBSERVATIONS (DAILY)

  • We are also witnessing the formation of ‘Higher Highs Higher Lows’ on a Daily chart, which is a positive sign as per ‘Dow Theory’.
  • Last few days stock is trading above the 15 days MA and recent closing above the Upper Bollinger Band showing the confidence of bullishness.
  • There is a recent Gap Up opening indicates further momentum on going upwards.
Tech Mahindra Daily Chart
Tech Mahindra Daily Chart

MONEY MANAGEMENT AND TRADING RULES

1)  It’s advisable not to enter/exit beyond the recommended range.
2)  Strictly follow the StopLoss as mentioned. Honour it.
3)  Use trailing StopLoss to retain profits.
4)  Diversify trading capital into our other technical recommendations.
5)  Risk only the money what you can afford to lose. Hedge accordingly.

ANALYST SUMMARY

This research analysis is prepared by Arijit Banerjee, CMT, CFTe. An engineering graduate developed an early interest in Trading since the age of 20. He is a Chartered Market Technician (CMT) accredited by CMT Association USA, the leading global authority of Technical Analysis and also has been honoured by Certified Financial Technician (CFTe) from the International Federation of Technical Analysts (IFTA), USA. His contribution to the market research was recognized by SEBI, the Regulatory Body of Indian financial market and given him the registration number INH300006582 as a Research Analyst. Over the years, he has gained experience in Technical Analysis with a demonstrated history of working in different asset classes. Himself as a trader, he has trained and continues training novice and experienced traders to become successful, confident and profitable in the financial market.

Disclosure

The views expressed herein are based solely on information available publicly/internal data/other sources believed to be reliable, but is not necessarily all-inclusive and is not guaranteed as to accuracy. The recommendations provided herein is solely for informational purposes and are not intended to be and must not be taken alone as the basis for an investment/trading decision. Trading and investing are subject to market risk and the securities discussed and opinions expressed herein may not be suitable for all investors. To read the full disclosure, please click here.

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