Nifty IT climbs upstream, majors strive for a bounce back

While the entire market is grabbed with negative sentiments, Nifty IT is trailing flat to positive amid bounce back in the IT majors. TCS and Tech Mahindra which form 25.7 per cent and 12.2 per cent of Nifty IT index were up 0.8 per cent and 1 per cent, respectively. Even Infosys which holds 26 per cent weightage is marginally up with 0.3 per cent gains. The only major HCL Technologies which forms 16.6 per cent of the IT is down 2 per cent and thereby is holding the index from gaining further. 

Technically, where the benchmark indices have seen 4 consecutive days of downfall, Nifty IT index is trading in consolidation from past 5 trading sessions. After hitting a multi-year high on January 24, Nifty IT index corrected along with other sectoral indices. However, the index took a pause at 50 per cent retracement of the prior upward rally and bounced back up to 23.6 per cent of the same rally.

The bounce back was supported by rising volumes and 14-period RSI positive crossover at 47 levels. Currently, the index RSI is trailing at 57 i.e. a momentum is likely in the coming sessions, provided the index breaches 12930-13130 levels.