Long-term technical support attracts buying interest as IT stocks recover from July lows; HCL Tech shows improving momentum, while Zensar’s chart points to a possible move towards ₹555–580

Indian information technology stocks have staged a notable recovery from their July 2026 lows, bringing long-term technical support levels back into focus. Against this backdrop, Virat Jagad, technical research analyst at Bonanza, has identified HCL Technologies and Zensar Technologies as two stocks that have attracted buying interest after testing their respective 100-month exponential moving averages (EMAs).

A 100-month EMA is a long-term technical indicator that gives greater weight to more recent prices while tracking a stock’s trend over an extended period. Traders often monitor it as a potential support or resistance zone, although it does not guarantee that a price reversal will continue.

According to Jagad, both stocks have shown signs of recovery after approaching these long-term levels. HCL Technologies has rebounded sharply from its July low, while Zensar Technologies has repeatedly tested its long-term support before recovering in October. The analyst sees improving chart patterns in both counters, but the sustainability of the rebound will depend on follow-through buying and broader market conditions.

IT Stocks Recover as Nifty IT Rebounds From July Lows

The Nifty IT index has recovered significantly from its July 2026 low of 25,699, gaining nearly 23% over the subsequent four months to trade around 31,699, according to the figures cited in the report.

The recovery has extended across several major IT companies. Coforge, Persistent Systems and HCL Technologies have advanced approximately 34–42% from their respective July lows. Tech Mahindra, LTIMindtree, Tata Consultancy Services, Mphasis and Infosys have also recorded gains in the range of 13–22%.

The sector's rebound has improved technical sentiment after a period of weakness. However, share-price recoveries should be assessed alongside business fundamentals, including revenue growth, deal wins, client spending, operating margins and management guidance.

The recent strength in IT shares may reflect a combination of technical buying, improved market sentiment and renewed interest following quarterly earnings developments. Investors should not assume that every stock in the sector will participate equally in any further rally.

HCL Technologies: Long-Term Support at the 100-Month EMA

HCL Technologies attracted buying interest after approaching its 100-month EMA during July 2026. The stock touched a low of approximately ₹1,059 that month before recovering to around ₹1,376 at the time of the cited technical assessment.

The stock’s 100-month EMA was reported at approximately ₹1,016, while its 50-month EMA was also being monitored as an indicator of the medium- to long-term trend. HCL Technologies has moved back above the 50-month EMA, which the analyst interprets as evidence of improving buying interest.

Jagad noted that the bullish monthly candle formed in October indicated improving momentum following the earlier correction. A monthly candle summarises a stock’s price movement over an entire month and can help technical analysts assess the balance between buying and selling pressure.

The recovery from the July low is substantial, but the stock remains exposed to changes in the outlook for global technology spending, client budgets, deal conversion and margins. The technical signal will be more convincing if the stock sustains its gains rather than quickly reversing towards its earlier support zone.

Zensar Technologies: Repeated Tests of Long-Term Support

Zensar Technologies has also attracted attention after repeatedly testing its 100-month EMA over the past five months. The stock declined to a July 2026 low of approximately ₹413, representing a fall of around 38% during the correction described in the report.

In October, Zensar again traded near its 100-month EMA, reported at approximately ₹403, before recovering towards ₹510. The stock had gained more than 26% from its calendar-year low at the time of the assessment.

Jagad believes Zensar is attempting to establish a base after its prolonged decline from recent highs. In technical analysis, a base is a period in which a stock's price stabilises within a range, potentially indicating that selling pressure is easing and buyers are becoming more active.

The analyst identified ₹555–580 as potential upside objectives if the recovery continues. These are technical targets, not guaranteed price levels. A sustained move towards them would depend on the stock maintaining its rebound and attracting further buying interest.

The ₹403 area remains an important reference point in the analyst's assessment. A decisive move below long-term support would weaken the recovery thesis and raise the possibility of renewed selling pressure.

What Does a 100-Month EMA Rebound Mean for Investors?

The 100-month EMA is a long-term chart indicator that can help investors identify areas where a stock has historically attracted buying interest. When a stock approaches this level and subsequently recovers, technical analysts may interpret the movement as evidence that long-term buyers are defending the price zone.

However, an EMA is not a fixed floor. Prices can break below it, and a rebound from the indicator does not by itself confirm that a new sustained uptrend has begun.

Investors should consider three aspects when evaluating such signals:

• Confirmation of momentum: A sustained recovery, supported by stronger trading activity, may provide more confidence than a brief bounce.

• Support and resistance: Traders should monitor whether the stock holds its recovery levels and can move through nearby resistance zones.

• Business fundamentals: Earnings performance, order inflows, client demand and valuation remain important even when the technical setup appears favourable.

Technical analysis can help frame possible price scenarios, but it should not replace an assessment of the company's financial performance and risk profile.

Market Outlook

HCL Technologies and Zensar Technologies have shown signs of technical recovery after testing their respective 100-month EMAs, according to Bonanza's Virat Jagad. HCL Tech's rebound above its medium- to long-term trend indicator points to improving momentum, while Zensar's recovery from the ₹403 support area has raised the possibility of further upside towards ₹555–580.

The key question is whether these rebounds develop into sustained trends. Failure to hold support, renewed weakness in the IT sector or disappointing earnings developments could reverse the recent gains. Investors should monitor price action alongside company fundamentals and avoid treating technical targets as assured outcomes.