The stock of Reliance Industries extended its downfall by declining 4 per cent in the week gone by. Since recording a 52-week high at Rs.1,067 on July 23, the stock has been on a medium-term downtrend.
Even the short-term trend is down. While trending down, the stock breached key supports and the 200-day moving average. It now trades well below its 50 and 200-day moving averages.
Both the daily and weekly relative strength indices now feature in the bearish zone. The daily as well as weekly price rate of change indicators hover in the negative terrain implying selling interest.
However, the stock has a significant long-term support in the Rs.800-820 band. Traders holding their short positions can consider exiting at this support band. Only a decisive fall below the Rs.800-820 range will strengthen the downtrend and pull the stock to Rs.775.
Key resistances are placed at Rs.850, Rs.870 and Rs.900 levels.
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