Robust Call Option Volumes Signal Bullish Sentiment
Data from the options market reveals that TCS call options with strike prices of ₹3,000, ₹3,100, and ₹3,200 have attracted significant attention. The ₹3,000 strike call led the pack with 6,704 contracts traded, generating a turnover of ₹932.81 lakhs and an open interest of 7,751 contracts. Close behind, the ₹3,100 strike call saw 6,633 contracts traded with a turnover of ₹427.86 lakhs and open interest standing at 8,734. The ₹3,200 strike call, while slightly less active, still recorded 4,954 contracts traded, turnover of ₹132.30 lakhs, and an open interest of 11,921 contracts.
This concentration of activity at strikes above the current underlying price of ₹2,992 suggests a bullish positioning by market participants, anticipating a potential rally beyond the ₹3,000 mark by expiry. The open interest figures, particularly the 11,921 contracts at ₹3,200, indicate substantial outstanding positions that could influence price dynamics as expiry nears.
Expiry Patterns and Market Context
The 24 February 2026 expiry is shaping up as a critical juncture for TCS options traders. The clustering of call option volumes and open interest at strikes incrementally above the current market price reflects a strategic bet on upward momentum. This is noteworthy given TCS’s recent price performance, which remains approximately 4.6% above its 52-week low of ₹2,866.6.
Despite this proximity to the lower end of its annual range, TCS has marginally outperformed its sector by 0.26% on the day, though it trades below all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a cautious technical backdrop. The stock’s delivery volume surged to 73.91 lakh shares on 4 February, a 261.55% increase over the five-day average, indicating rising investor participation amid this consolidation phase.
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Fundamental and Technical Overview
TCS, with a market capitalisation of ₹10,83,689.57 crores, remains a large-cap heavyweight in the Indian IT sector. The company’s Mojo Score currently stands at 51.0, reflecting a Hold rating, an improvement from a previous Sell grade revised on 22 April 2025. This upgrade signals a stabilisation in fundamentals and market sentiment, though the stock’s Market Cap Grade remains at 1, indicating limited upside from a valuation perspective.
Investors should note the stock’s attractive dividend yield of 3.63%, which provides a cushion amid sideways price action. However, the technical picture remains mixed, with the stock trading below all major moving averages, suggesting that any bullish momentum may require confirmation through sustained volume and price strength.
Options Market as a Barometer of Investor Expectations
The heavy call option activity at strikes above the current price is a clear indication that traders are positioning for a rebound or a breakout. The ₹3,000 strike, just above the current level, has the highest turnover, signalling that many investors are willing to pay a premium for the possibility of TCS surpassing this level by expiry. The open interest concentration at ₹3,200 further underscores a bullish bias, as traders anticipate the stock moving closer to or beyond this strike within the next three weeks.
Such positioning is consistent with a market that is cautiously optimistic but aware of near-term resistance levels. The expiry date being less than three weeks away adds urgency to these trades, with investors likely to adjust their positions as the stock price evolves.
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Investor Implications and Outlook
For investors and traders, the current options activity in TCS offers valuable insights into market expectations. The bullish skew in call option volumes and open interest suggests confidence in a near-term price recovery, potentially driven by upcoming earnings, sectoral tailwinds, or broader market sentiment improvements.
However, the stock’s technical weakness and proximity to its 52-week low caution against overly aggressive positioning. Investors should monitor price action closely, particularly around the ₹3,000 to ₹3,200 levels, which appear to be key battlegrounds for bulls and bears alike.
Given the stock’s liquidity, with a 5-day average traded value supporting trade sizes up to ₹31.67 crores, institutional investors can manoeuvre sizeable positions without significant market impact. This liquidity, combined with rising delivery volumes, points to increasing participation that could fuel volatility and create trading opportunities.
Conclusion
Tata Consultancy Services Ltd. is currently at a pivotal point, with options market data revealing a pronounced bullish tilt ahead of the 24 February expiry. The concentration of call option interest at strikes above the current price reflects optimism about a potential rebound, despite the stock’s recent technical challenges. Investors should weigh these signals alongside fundamental factors and broader market conditions to make informed decisions.
As expiry approaches, the interplay between open interest unwinding and fresh positioning will be critical in determining TCS’s near-term trajectory. For now, the options market serves as a valuable barometer of investor sentiment, signalling cautious optimism in one of India’s largest IT bellwethers.
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