INFY: Breakout Alert from ₹950-975 Support Zone

INFY: Breakout Alert from ₹950-975 Support Zone

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• Double Top pattern formed on daily charts, indicating a potential reversal.
• Breakout from falling channel pattern, with a clear support zone at ₹950-975.
• Strong buying interest at this level, with a possible bounce back to ₹1,120.

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Infosys Limited (INFY) has been on a downward spiral since its Q4 FY23 results announcement, with a 7.55% decline in stock price to ₹1,042.40. The primary catalyst behind this decline is the company's lower-than-expected revenue growth of 2.9% QoQ and net profit decline of 16.5% YoY. However, the breakdown from the falling channel pattern and the double top pattern formed on the daily chart suggest a potential reversal. The company's market capitalization, large-cap status, and sector dominance in the IT industry make it an attractive play for retail investors.

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**: Double Top pattern formed on the daily chart, with two consecutive peaks and troughs at ₹1,100 and ₹1,070, respectively.

Chart Setup: Candlestick chart on daily and weekly timeframes, with key technical indicators including 20-day and 50-day simple moving averages, RSI (14-period), MACD, and volume bars.

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**: Strong support zone at ₹950-975, with resistance at ₹1,050-1,075.

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**: Swing traders and investors, with a hold period of 2-3 weeks.

ENTRY POINT: ₹990 (a 5% dip from the current price, with a clear support zone in place).

STOP LOSS: ₹940 (3% buffer for intraday volatility, marking the bottom of the consolidation range).

TARGET 1: ₹1,075 (near-term profit taking, indicating a 9% upside from the entry point).

TARGET 2: ₹1,120 (longer-term target, indicating a 13% upside from the entry point).

Timeframe: Hold for 2-3 weeks to capture the potential upside from the breakout.

Risk/Reward Ratio: 3:1 (risking ₹1 to make ₹3).

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**: Regulatory compliance issues, intense competition in the IT services sector, and potential headwinds in key client industries.

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**: Sector headwinds, macro factors, and market sentiment.

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**: Breakout failure from the falling channel pattern, potential head-and-shoulders pattern formation.

N uanced Recommen dation

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Buy Dip | CONFIDENCE: Medium | WHY:** A potential reversal from the breakdown pattern and a possible bounce back from the strong support zone.

Disclaimer: The views expressed in this blog post are for informational purposes only and should not be considered as investment advice. Trading involves risk of loss, and any action taken based on this or any other article should be taken with caution.

Buy Dip | CONFIDENCE: Medium | WHY: A potential reversal from the breakdown pattern and a possible bounce back from the strong support zone.