Bear Spread Strategy on Tata Consultancy Services by HDFC Securities

Stock Price has broken down on the daily chart to close at the lowest level since June 2018 with higher volumes.

Bear Spread strategy on TCS

Buy TCS March 1800 Put at Rs 113

Target 170

Stop Loss 70

Lot Size  250.

Rationale:

1. Aggressive Short build up is seen in the TCS Futures’ where we have seen sharp rise (Prov) in the Open Interest with price falling by 9 per cent.
    
2. Stock Price has broken down on the daily chart to close at lowest level since June 2018 with higher volumes.
    
3. Primary trend of the stock turned negative where it is trading below its 5,20 and 200 day SMA.
    
4. Oscillators and Momentum Indicators like RSI and MACD showing weakness in the stocks.
    
5. Technology as a sector looking weak on the Charts 

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Disclaimer: Nandish Shah is a Technical & Derivative Analyst at HDFC securities. Views are personal.