TCS - Technical Analysis with Chart Patterns & Indicators

Last Updated Time : 20 Dec 25, 03:55 pm

Technical Rating: 4.2

📊 Chart Patterns: TCS is trading above both its 50 DMA (3,137 ₹) and 200 DMA (3,301 ₹), showing strong upward momentum. Support lies near 3,137–3,301 ₹, while resistance is around 3,350–3,400 ₹ and the upper range near 4,382 ₹. The broader chart suggests a strong uptrend with consolidation near highs.

📈 Moving Averages: Current price (3,283 ₹) is above both 50 DMA and 200 DMA, signaling bullish momentum.

📉 RSI: At 68.4, RSI is approaching overbought territory, suggesting strong momentum but caution for potential pullback.

📈 MACD: Positive (39.3), confirming bullish crossover and continued upward momentum.

📊 Bollinger Bands: Price is near the upper band, indicating strength but also potential resistance near 3,350–3,400 ₹.

📊 Volume Trends: Current volume (26,16,446) is higher than average weekly volume (18,60,314), showing strong participation and accumulation interest.

🚦 Momentum Signals: Short-term momentum is bullish. Sustained move above 3,350 ₹ could trigger breakout toward 3,500–3,600 ₹.

🎯 Entry Zone: 3,200–3,250 ₹ (near DMA support).

🎯 Exit Zone: 3,350–3,400 ₹ (resistance zone), with extended target toward 3,600 ₹.

📌 Trend Status: The stock is trending upward with consolidation near highs.

Positive

• Exceptional ROCE (78.4%) and ROE (65.0%) highlight superior capital efficiency.
• EPS of 131 ₹ reflects strong earnings power.
• Dividend yield of 1.82% provides steady shareholder returns.
• DII holdings increased by 0.69%, showing domestic institutional support.

Limitation

• RSI near overbought levels (68.4) suggests risk of short-term pullback.
• P/E of 24.8 is slightly above industry average (26.4), indicating fair-to-high valuation.
• PEG ratio of 3.11 suggests expensive growth prospects.

Company Negative News

• PAT declined slightly from 12,552 Cr. to 12,486 Cr. (-3.91% variation).
• FII holdings decreased by -1.15%, showing reduced foreign investor confidence.

Company Positive News

• Strong fundamentals with consistent profitability and high efficiency ratios.
• DII inflows reflect confidence in long-term growth potential.

Industry

• Industry P/E at 26.4 indicates moderate valuation compared to TCS’s slightly lower levels.
• IT services sector remains supported by global demand for digital transformation and outsourcing.

Conclusion

⚖️ TCS is trending upward with strong bullish signals from MACD, RSI, and moving averages. Short-term traders may consider entry near 3,200–3,250 ₹ with exit around 3,350–3,400 ₹. Long-term investors may find value in strong fundamentals and sectoral demand, though caution is warranted due to high RSI and slowing quarterly profit growth.