Greetings, traders!
Today we are analysing three prominent IT stocks, which are Infosys (NS:INFY), Wipro (NS:WIPR), and Tech Mahindra (NS:TEML). Moreover, we also analyse the ever-popular cryptocurrency, Bitcoin. The analysis of Infosys is via this article. However, I have analysed Wipro, Tech Mahindra, and Bitcoin in a YouTube video shared below. In it you will find a breakdown of each one’s price action analysis, coupled with my detailed trading plan.
Furthermore, for Bitcoin, I shed light on why you shouldn’t focus on that 100k resistance level. This is as there is a different resistance zone it has to overcome, which is the real hurdle. Plus, how overcoming that zone can help you make a killer return.
Infosys: Back in the Saddle:
Infosys has been a regular feature on my YouTube channel, as it has always been a great stock for equity and options trading. Now I cover the stock again, as it seems to be gearing up for a big move. This is because it formed a high-volume bullish price bar last week, which shows that volatility is returning. Thus, this coupled with the earnings season kicking off this week for the IT sector, warrants us to track it. Moreover, some may fear volatility, but I believe it is a trader’s best friend.
What’s next for Infosys? Now, the current price structure shows us a few possibilities. Now, as long as the stock trades between the 1,880 support and 1,980 resistance, then it is a big no for investors. This is as this zone will only benefit option sellers. However, if it breaks the 1,980 resistance, we could be in for a short-term climb. The first target will be 2,080, with an even more ambitious second target of 2,150. Conversely, a break below the 1,880 support would mean a dip to 1,780 and possibly even 1,700.
What is my trading plan for Infosys? Since Infosys is teetering on the edge of this range, my trading strategy is a two-pronged attack, which involves equity and F&O trading. For equity trading, I will only join the party if it breaks the 1,980 resistance. If that happens, then I will go in for a long with a target of 2,080 and 2,150.
On the options front, I already have some positions in place via option selling. This is as I am currently holding both put (PE) and call (CE) sells. I strategically placed my PE sells at 1880 and below, and my CE sells above 2000. I deployed these bad boys in late December for the January option series. Since it is remaining nestled in my sweet range, these positions are already in a good profit. But here is the kicker: I have placed a profit stop. That way, if the stock breaks above 1980 or below 1880, then I can automatically exit one leg of the options with a profit and let the other leg ride until the month-end expiry. If the stock stays within this range until Friday, then I will add onto the same option sells to size up my position.
The Final Verdict:
The charts of Infosys hint that a significant move might be brewing if it breaks out of the given range. But even if it doesn’t, you can benefit from the sideways action by using the option sells given above. If I do have a change in my trading plan, then I will update it via my channel. Lastly, do not forget to check out the video for the full breakdown of Wipro, Tech Mahindra, and Bitcoin. These opportunities are not to be missed!
Youtube link to Wipro, Tech Mahindra and Bitcoin: https://youtu.be/u53Uu1eXqTA
Happy trading!
Disclaimer: The investments discussed by Sandeep Singh Ahluwalia may not be suitable for all investors. Thus, you must trust your analysis and judgement before making investment decisions. The information provided is for informational purposes only and should not be interpreted as a proposition to buy or sell any securities.