TCS extends service to M&G Prudential, flag pattern breakout expected

The largest company by market capitalisation, TCS, on Tuesday, extended its agreement with M&G Prudential to cover latter’s additional 1.8 million customer policies. The stock of TCS surged for the fifth consecutive day on Tuesday and closed 1.8 per cent up. TCS which holds 28 per cent weightage in the Nifty IT index and 4.1 per cent in Nifty 50 helped uplift the markets during the day.

Earlier in January, TCS had announced a 10-year partnership to digitally transform M&G Prudential's business and deliver enhanced services to its savings and retirement customers in UK. With the current addition of 1.8 million, the total policies covered by partnership would account for 5.8 million. The said agreement is worth an additional 500 million Pounds.

Technically, considering the weekly time frame, the stock has kind of formed a Flag pattern. After 5 consecutive weekly upticks making the flag pole, the stock is trading in an upward sloping flag. The prices are trading in the range of 23.6 per cent to 38.2 per cent retracement level of the flag pole. During the last week, the stock took support at the lower line of the flag and current week is seen continuing the upside. The level of 1800-1810 is the upper end of the flag and would act as the resistance going forward, while 1710-1720 would act as the support.