TCS stock on verge to break this 16-year-old trend; can crash another 16%

Business Standard

a day ago

TCS stock slipped 1.7 per cent to a low of ₹3,082 in intra-day trade on Monday, a day after the company said it would l ay-off 2 per cent or 12,260 employees of its global workforce. The job cuts by India's largest IT services company highlights the extent of challenges faced by technology-sector amid a sluggish global economy, geopolitical tensions and tariff concerns. Globally, Microsoft, IBM, Intel and Meta too have reduced head counts in the calendar year 2025 thus far. READ MORE On the earnings front, earlier this month, TCS reported a 6 per cent year-on-year (YoY) growth in net profit at ₹12,760 crore for Q1FY26 as against ₹12,040 crore in Q1FY25. Revenue from operations increased by 1.3 per cent YoY to ₹63,437 crore. Post the earnings announcement, TCS management remained optimistic overall, but admitted that high single-digit growth in FY26 looks tough.
TCS stock performance thus far in 2025
TCS stock has been an under-performer so far in the calendar year 2025. The stock has dropped 22 per cent in the first seven months of the year, slightly more than the sectoral Nifty IT index - which has declined 18.3 per cent. In comparison, the NSE Nifty 50 has gained nearly 5 per cent in the same period. ALSO READ | Will Nifty end July above or below 25,000? These 3 key factors to set trend In July alone, the stock has declined over 10 per cent; while the Nifty IT has shed 9 per cent, and the Nifty 50 index was down around 3 per cent.
Technical outlook on TCS stock
Tata Consultancy Services (TCS) Current Price: ₹3,092 Likely Target: ₹2,590 Downside Risk: 16.2% Support: ₹3,100; ₹2,900; ₹2,750 Resistance: ₹3,212; ₹3,388 Following a sharp fall at the counter, TCS stock is now on verge of breaking a key 16-year bullish trend, as per the monthly scale. Historical chart shows that TCS stock has consistently traded above its super trend line support on the monthly scale since the breakout in July 2009. Even during the Covid-19 related panic sell-off, the stock briefly dipped below this key long-term trend line support, but eventually managed to close above the same on a monthly closing basis in March 2020. Today, July 28, 2025, for the first time since March 2020, TCS is once again trading below the monthly trend line support, which stands at ₹3,121. A monthly close below the same shall signal the end of the 16-year bullish run for the stock.
The monthly chart further stocks presence of some support around ₹3,100 levels, which is the lower-end of the Bollinger Bands. Break and sustained trade below the same can accentuate the fall at the counter. The next key support for TCS, as per the monthly chart, stands around ₹2,590 levels - the 100-Month Moving Average (100-MMA). This implies a downside risk of around 16.2 per cent from present levels. Intermediate support for the stock can be anticipated around ₹2,900 and ₹2,750 levels. TCS stock is seen trading below the key moving averages on the daily and weekly charts; thus indicating presence of multiple overhead resistances. The near-term bias is likely to remain bearish as long as the stock trades below 3,212 levels; while the key medium-term hurdle stands at 3,388 levels.