TCS shares rally 8% in 2 days. Time to buy after sharp 32% crash in 2026? Here’s what technical charts indicate

The shares of Tata Consultancy Services (TCS) rallied around 7% on Monday, extending a two-session gaining streak that added more than Rs 56,225 crore to the market capitalisation of India’s largest IT company.TCS shares rose to Rs 2,204.90 apiece on the NSE on Monday afternoon, the highest level seen by the stock in nearly a month.

The stock has gained 7% in one week and 2% in one month, but is still down around 32% in 2026 so far.Why are TCS shares rising?The sharp surge in TCS share price today came after the company announced a multi-million, multi-year deal with ABB to transform global network operations with artificial intelligence.

The IT major said it has signed a multi-million, multi-year deal with ABB to scale its role from managing infrastructure and applications to delivering end-to-end global network operations, through an integrated network-as-a-service model.The gaining streak began last week after the IT bellwether reported last week 5% year-on-year (YoY) growth in consolidated net profit to Rs 13,349 crore for the first quarter of the ongoing financial year 2027.

The company’s consolidated net profit stood at Rs 12,760 crore in the corresponding quarter of the previous financial year.

The firm’s revenue from operations, meanwhile, rose around 14% YoY to Rs 72,275 crore during the quarter under review, as against Rs 63,437 crore in the year-ago period.

Its total contract value in Q1 FY27 stood at $9.5 billion.Also read: TCS shares rally 6% after multi-million ABB AI deal, Q1 earnings.

What’s next?What lies ahead for TCS shares?TCS shares are currently trading above their 20-day EMA, said Sudeep Shah, Head - Technical and Derivatives Research at SBI Securities.

He highlighted that this is the first time the stock has moved above its 20-day EMA since June 2, indicating an improvement in near-term sentiment.“On the daily chart, encouraging signs are beginning to emerge.

The RSI has broken above a horizontal resistance trendline and is moving higher, while the MACD histogram bars have started to expand, signalling a build-up in bullish momentum,” he said.Shah, however, cautioned that it is still premature to classify this as a confirmed trend reversal.

The 2,190–2,200 zone is likely to act as immediate resistance.

Unless the stock manages to decisively break and sustain above this zone, the probability of a meaningful short-term trend reversal remains low, according to the analyst.However, some caution is warranted.

Harshal Dasani, Business Head at INVasset PMS, said that the stance stays firmly bearish on TCS technically until either the Rs 2,300 resistance breaks with conviction and volume, or the Rs 1,976 support holds through multiple retests with visible volume drying up on each attempt.

“Until one of those two conditions is confirmed, any bounce from current levels should be treated as a rebound within a downtrend rather than a trend reversal signal,” he added.Also read: TCS CEO on Q1 performance; B Capital on India’s IPO market(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own.

These do not represent the views of The Economic Times) ...