We at Analyse India came out with a report called “ Happy New Financial Year – Five stock picks for FY13 ” on 1st April 2012 in which the 3rd stock out of the five stocks we mentioned was Tech Mahindra and the following is an excerpt from that report:
3. Tech Mahindra
As you see in this chart the stock has broken out of 5 year old Red Trendline on weekly closing basis and that too with huge vols ( highest in last 12 months) giving first signs of trend change. Stock has also been in a green parallel channel of 300 points range since last 2 years. The confirmation of trend change comes above 770-800 range if stock breaks out of this parallel channel then it can head to 1100-1150 in
Investors can Buy Techm EITHER on dips to 650-670 range with stoploss
of 580 on closing basis OR wait for confirmation above 770-800 range for
targets 1100-1150 in medium term
The stock was recommended at 650-670 levels, yesterday it made a high around 1040 levels and is heading towards 1100-1150 targets given in the report. Investors can look to book part profit at current levels of 1030-1050 and keep trailing their stoploss for final targets 1100-1150.
Mphasis is trading in a huge symmetrical triangle after the fall in Feb 2011. The stock is in a consolidation phase for last 15 months. It can give a big move if it sustains & closes above 415-420 range. Mphasis after the breakout can head to 480-500 levels in medium term whereas long term targets around 600 are also possible in this move.
Buy Mphasis only if sustains/closes above 415-420 range with stoploss of 380 on
closing basis and targets 480-500 in medium term.
Now we feel Mphasis is giving same signs of breakout that Tech Mahindra did and this is the comparison of both the stocks:
Comparison – Tech Mahindra vs Mphasis
|1. Topped Out||At 1150 level in Jan 2010||At 700 level in Jan 2011|
|2. The Big Fall||Corrected 46% from the highs||Corrected 47% from the highs|
|3. Consolidation Period||22 months||15 months|
|4. Breakout Confirmation||Above 780-800 range||Above 415-420 range|
|5. Targets||Achieved at 1030-1050 levels||Expected at 550-600 levels|
|6. Sector||Information Technology||Information Technology|
Technical Analyst & Derivatives’ Strategist
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