Analysis: INFY

Today’s pick is [stockquote]INFY[/stockquote]. The stock has been in a down-trend since highs of Feb. However, since late August, the stock has seen a pennant formation. In the last three month period, the stock was up 2% Vs. 4% as that of Nifty’s return.

We had issued a short-term buy last month that didn’t quite pan out as we expected – the stock is basically flat since then, stuck in a narrow range.


Oscillators RSI and CMO are at currently at 50 and -3 are in no men’s land.

MACD line and the signal line are moving very close to each other and are not suggesting any trend.

The GMMA long-term as well as short-term lines are running very close to each other and are not able to suggest any direction.


INFY’s average correlation of 0.52 with the Nifty is positive and strong. The stock will replicate the movements of Nifty because of the co-efficient. [stockquote]NIFTYBEES[/stockquote]


INFY has a historical volatility in the range of 0.2 to 0.7. The scrip’s volatility is currently towards the lower side of the range.



Analysts have quite a high expectation regarding the stock. A drift in the earnings compared to the analysts expectation might pull the stock down. The stock saw stock selling by an insider worth Rs. 1 Cr. a couple of weeks ago.

Looking at these technicals we suggest that investors keep off this scrip for the short-term. A break-out of the pennant in either direction will trigger a longer-term call.

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