As bulls charge ahead in 2025, India’s stock market displays robust momentum. The Nifty50 index is inching to its 2025 highs (24,226), while Bank Nifty has already set a new milestone, crossing the 55,000 mark. However, the IT index is one sector lagging in the rally, raising a critical question for investors: Has IT stock lost its ground?
The Nifty IT Index, which held its strength in Q4-2024, has shown signs of fatigue in 2025. From its peak of 46,088, the index corrected to 30,918—a sharp 33% decline. But the story doesn’t end there for technical traders and pattern watchers.
Nifty IT Index
Source: TradePoint
On the daily Heikin Ashi chart, a Bullish Black Swan harmonic pattern has emerged, suggesting a potential trend reversal. More importantly, the RSI indicator shows a positive divergence during the latest downward leg, often a precursor to a bullish comeback.
Completing the harmonic pattern and a bullish candlestick signal, IT stocks might just be ready to rebound.
The Nifty IT Index comprises 79% large-cap and 21% mid-cap stocks. While large-cap IT stocks led the recent correction, mid-cap IT stocks show stronger bullish reversal patterns.
Technical indicators point toward a potential outperformance in select midcaps. Here are three mid-cap IT stocks to watch in 2025:
1. Coforge Ltd
Coforge is a fast-growing midcap IT services firm specialising in digital transformation, cloud services, and automation solutions across industries. The company has built a strong reputation for consistent delivery and innovation in the enterprise technology space.
Coforge Weekly Chart
Source: TradePoint
A Bullish White Swan harmonic pattern is visible on the weekly chart, suggesting a reversal is on the cards. Adding to this, a bullish belt hold pattern has formed at the reversal zone, providing additional confirmation that Coforge may witness potential upside rally in the coming weeks.
2. LTIMindtree (LTIM)
LTIMindtree, formed by the merger of L&T Infotech and Mindtree, is a diversified IT services provider with strong capabilities in digital solutions, cloud infrastructure, and data analytics. It has gained attention for its scalable business model and expanding global footprint.
LTIM Weekly Chart
Source: TradePoint
A Bullish Nen-Star harmonic pattern is visible on the weekly chart, hinting at a trend reversal. A long-bodied bullish candle appearing right at the reversal zone strengthens the conviction that LTIM could potentially be gearing up for a significant upside move.
3. Mphasis Ltd
Mphasis is a key player in the midcap IT space, offering cloud and cognitive services tailored for the banking, financial services, and insurance (BFSI) sector. With a client-focused delivery model and digital-first strategy, Mphasis is well-positioned for growth.
Mphasis Weekly Chart
Source: TradePoint
On the weekly chart, a Bullish Extended Shark harmonic pattern has emerged. More importantly, a classic Morning Star candlestick formation—a three-candle bullish reversal pattern—has confirmed the likelihood of a bullish breakout.
Rising of Mid-Cap IT Stocks
While the broader markets continue their upward momentum, Nifty IT stocks are at a technical crossroads. With harmonic patterns signalling reversals and RSI divergences supporting the narrative, mid-cap IT stocks like Coforge, LTIM and Mphasis offer potential opportunities for traders and investors seeking growth in 2025.
For traders and long-term investors alike, the message is clear – Don’t write off IT stocks just yet—the charts might be telling a different story.
Disclaimer:
Note: We have relied on data from throughout this article. Only in cases where the data was unavailable have we used an alternate but widely used and accepted source of information.
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Brijesh Bhatia has over 18 years of experience in India’s financial markets as a trader and technical analyst. He has worked with UTI, Asit C Mehta, and Edelweiss Securities. Presently, he is an analyst at Definedge.
Disclosure: The writer and his dependents do not hold the Stocks discussed in this article. However, clients of Definedge may or may not own these securities.
The website managers, its employee(s), and contributors/writers/authors of articles have or may have an outstanding buy or sell position or holding in the securities, options on securities or other related investments of issuers and/or companies discussed therein. The articles’ content and data interpretation are solely the personal views of the contributors/ writers/authors. Investors must make their own investment decisions based on their specific objectives, resources and only after consulting such independent advisors as may be necessary.