The stock of Tech Mahindra (₹1,584) is ruling at a crucial level. Though the outlook remains negative, we expect a technical pull back from current levels.

Immediate resistance for the stock is at ₹1,625 followed by ₹1,689. A close above the latter will alter the short-term negative outlook whereas a close above ₹1,716 will reconfirm the bullish outlook.

On the other hand, nearest support levels are at ₹1,503 and ₹1,422. A close below the latter has the potential to trigger the next leg of sell-off, possibly taking the stock down to ₹1,333.

F&O pointers: Tech Mahindra August futures closed at ₹1,582.20 and September futures at ₹1,591.80 against the spot close of ₹1,584. The premium in September series indicates rollover of long positions. The counter witnessed a rollover of nearly 60 per cent, which is quite healthy. Option trading indicates that the stock could move between ₹1,500 and ₹1,700.

Strategy: Buy Tech Mahindra September futures keeping initial stop loss at ₹1,566. If the stock opens on a flat to positive note, the stop loss can be shifted to ₹1,588. Target can be ₹1,618.

This strategy is not applicable if Tech Mahindra September contract opens above ₹1,605 or below ₹1,580.

Note that futures need higher margin commitments and the market, particularly IT stocks, will remain volatile. Therefore, risk-averse traders can avoid this trade.

Follow-up: As expected ITC moved with negative bias and hit our profit targets. 

Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading.

Published on August 22, 2026