After months of relentless selling and deep corrections, India's IT sector may finally be showing signs of life. Geojit Investments' Chief Market Strategist Anand James says technical indicators, derivatives data and improving momentum suggest the risk-reward is gradually shifting in favour of bulls. In an interview with ETMarkets, he also shares his outlook on Nifty, Kalyan Jewellers, Trent and his top stock picks for the week.
Edited excerpts from a chat:
Nifty broke the four-week winning spell after Trump revived strikes on Iran. What are the charts indicating at now?
The break in the winning streak can be attributed to Wednesday’s plunge, in reaction to a fresh outbreak of US-Iran tensions. The two recovery days that followed have wiped off most of the losses, but Friday’s close below Wednesday’s peak signals caution. That said, oscillators are positioned to support another attempt higher, as long as initial volatility is held above 24170-24090.
Nifty IT index ended the week 2% higher. Is the risk-reward now better for bulls?
The risk-reward appears to be improving for bulls, although confirmation of a broader trend reversal is still evolving. On the technical front, the index has produced multiple weekly reversal candles near a major support zone, while the weekly RSI has turned up from oversold territory, indicating waning downside momentum. More importantly, the weekly MACD is on the verge of a bullish signal crossover after a prolonged corrective phase, often an early sign of trend exhaustion.
On the daily timeframe, Nifty IT has reclaimed its Supertrend resistance, suggesting the recent pullback structure may be giving way to a recovery phase. The derivative setup also supports this view. Nearly 80% of the constituent stock futures witnessed either fresh long additions or short covering on Friday, highlighting improving participation across the sector. In options, short build-up in around 50% of the near OTM put strikes points to traders increasingly defending lower levels, reinforcing the belief that a near-term bottom may be in place.
While the index still needs to overcome key resistance zones to confirm a sustained uptrend, the combination of improving price structure, momentum indicators and derivatives positioning suggests that the reward-to-risk equation is gradually tilting in favour of the bulls and break above 28250 could lead the index towards 28850 in the near term.
Kalyan Jewellers hit fresh 52-week high and ended the week 25% up. Is this jewellery stock waking up a bigger bull run after a forgettable 2025?
Two consecutive days large rise has gotten everyone excited, having pushed prices beyond a multi month consolidation pattern. However, a strong horizontal resistance formed following a multi month consolidation prior to January 2026 could pose a significant challenge to further upsides early next week, and turbulence may be expected until 480-490 region is cleared.
Trent's Q1 update disappointed investors and the stock is down 13% in one week. Do you see near-term bottom being made or will the entire rally in June month get wiped out?
The gapped down opening followed by a massive plunge seen mid week led to a break of structure, calling for extended downtrend. However, the muted declines in the next few days on approach to a strong horizontal support near 2900 is suggestive that bearish momentum has slowed down, potentially allowing a swing higher, to atleast 3050-80. However, it is too early to call if such upmove may be sustainable.
Give us your top ideas of the week.
SWSOLAR (LTP: 236)
View: Buy
Target: 258
SL: 224
SWSOLAR is showing signs of a healthy pullback within an emerging uptrend. The stock has formed a bullish reversal candle near the 38.2% Fibonacci retracement level of the recent rally, indicating demand is re-emerging at a key support zone. Momentum indicators also support the constructive view, with the MACD histogram showing signs of exhaustion on the downside, suggesting selling pressure is fading.
Despite the recent correction, the RSI remains comfortably above the 55 mark, highlighting underlying strength and indicating that the broader bullish structure remains intact. As long as SWSOLAR holds above 224, the near-term bias remains positive and could pave the way for a move towards 258, which coincides with the next important resistance zone. Traders may use declines towards support levels as an opportunity while maintaining strict risk management below the stop-loss level.
BLACKBUCK (LTP: 578)
View: Buy
Target: 625
SL: 554
BLACKBUCK has confirmed a breakout from a prolonged horizontal consolidation range, signalling the potential start of a fresh upward leg. The breakout is supported by improving momentum, with the weekly MACD witnessing a bullish signal crossover, indicating a shift in the medium-term trend in favour of buyers.
On the daily timeframe, the RSI remains firmly above 60, reflecting strong underlying momentum and suggesting that buying interest continues to dominate. The stock has also sustained above the breakout zone, enhancing the reliability of the move and reducing the risk of a false breakout.
With price action, momentum and trend indicators aligned on the bullish side, the setup favours further upside as long as the breakout level holds. Traders can maintain a positive bias with a target of 625, while 554 remains a crucial stop-loss level.
