Open Interest and Volume Dynamics
On 23 Jan 2026, Tech Mahindra's open interest (OI) in derivatives rose sharply to 59,149 contracts, up from 53,039 the previous session, marking an 11.52% increase. This expansion in OI is accompanied by a futures volume of 37,053 contracts, indicating active participation in the derivatives market. The combined futures and options value stands at approximately ₹15,139 crores, underscoring the significant capital flow directed towards this stock.
Such a surge in open interest often signals fresh positions being established rather than existing ones being squared off. The increase in OI alongside rising volumes typically points to a strong conviction among traders, either in the form of directional bets or hedging strategies.
Price Performance and Technical Context
Tech Mahindra closed at ₹1,705, just 1.81% shy of its 52-week high of ₹1,736.4, demonstrating resilience and sustained buying interest. The stock has outperformed its sector by 0.64% on the day and has recorded gains for three consecutive sessions, delivering a cumulative return of 1.61% over this period. Notably, the share price is trading above all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a robust uptrend and positive technical momentum.
However, delivery volumes have declined by 21.35% compared to the five-day average, suggesting that while short-term trading activity is elevated, longer-term investor participation may be moderating. This divergence between derivatives activity and delivery volumes could imply that speculative interest is driving the recent moves rather than fresh long-term buying.
Market Positioning and Directional Bets
The sharp rise in open interest, combined with the stock’s proximity to its 52-week high, indicates that traders are positioning for a potential breakout. The futures value of ₹1,495 crores and options value exceeding ₹23,114 crores reflect substantial hedging and speculative activity. Given the positive price action and technical indicators, it is plausible that market participants are adopting bullish stances, expecting further appreciation in Tech Mahindra’s shares.
Moreover, the stock’s mojo score of 71.0 and an upgraded mojo grade from Hold to Buy on 14 Jan 2026 reinforce the positive sentiment. This upgrade by MarketsMOJO highlights improved fundamentals and technical strength, encouraging investors to consider fresh exposure.
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Sector and Market Comparison
Tech Mahindra’s 1-day return of 1.16% notably outpaces the Computers - Software & Consulting sector’s gain of 0.39% and contrasts with the Sensex’s decline of 0.23% on the same day. This relative outperformance underscores the stock’s leadership within its industry and resilience amid broader market weakness.
With a market capitalisation of ₹1,67,229 crores, Tech Mahindra is firmly positioned as a large-cap entity, attracting institutional interest and liquidity. The stock’s liquidity profile supports sizeable trade sizes, with an estimated tradable value of ₹15.62 crores based on 2% of the five-day average traded value, facilitating efficient execution for both retail and institutional investors.
Investor Sentiment and Risk Considerations
While the surge in open interest and positive price momentum are encouraging, investors should remain mindful of the recent decline in delivery volumes, which may indicate caution among long-term holders. The derivatives market activity could be driven by short-term traders capitalising on momentum rather than fundamental shifts.
Additionally, the stock’s proximity to its 52-week high means that any adverse news or broader market corrections could trigger profit-taking. Hence, risk management and monitoring of key support levels remain essential for investors considering fresh positions.
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Outlook and Strategic Implications
Given the current data, Tech Mahindra appears to be in a phase of constructive accumulation, with derivatives market participants positioning for further gains. The mojo grade upgrade to Buy and the strong mojo score of 71.0 reflect improved fundamentals and technical strength, making the stock an attractive proposition for investors seeking exposure to the IT services sector.
Investors should watch for continued increases in open interest and volume as confirmation of sustained bullish sentiment. Additionally, monitoring the stock’s ability to breach and sustain above its 52-week high will be critical in validating the breakout thesis.
In summary, the recent surge in open interest and volume, combined with positive price action and upgraded ratings, suggest that Tech Mahindra is poised for potential upside. However, prudent investors should balance this optimism with awareness of delivery volume trends and broader market conditions.
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