KONSKIE, POLAND - June 29, 2019: Reliance Jio Infocomm Limited Indian mobile network operator logo displayed on mobile phone
Reliance Industries (NSE: RELIANCE) share price has faced a 12.2% correction from its July 2023 peak. If you’ve been following my previous analysis of the stock, you must be on the right side of the market. I accurately predicted this drop due to a rejection from the range highs. At that time, many analysts laughed at me, but guess who’s laughing now?
After 3 consecutive weeks of downtrend, Reliance shares are finally experiencing some buying pressure. Technical analysis reveals that the bears are losing momentum as the price has hit a key level on the chart. On Tuesday, the shares were up 0.51% and traded at 2310.
The increasing tensions in the Middle East are weighing on the global oil prices and the valuation of the energy stocks. This could be the reason behind a 0.85% decline in Reliance Industries share price on Monday, as the oil prices surged by $3 on the first trading day of the week.
According to the most recent Reliance news, the conglomerate’s retail arm, Reliance Retail Ventures, is set to receive INR 49.7 billion from the Abu Dhabi Investment Authority. This will give ADIA a 0.59% stake in Reliance Retail. The news comes just less than two weeks before Reliance Industries is set to release its financial results.
In my last NSE RELIANCE analysis, I predicted a retest of the 200 MA on the daily chart. This retest occurred recently almost perfectly, and now I am expecting a bounce in the stock. The reason why I am confident of a bounce from the 2,290 level is because this region has a confluence of the 200 MA and the middle of the trading range.
The bullish divergences in the RSI and MFI indicators further validate this thesis. Therefore, I’m not that bearish on the Reliance Industries share price anymore. However, if the price breaks below the 2,290 level and holds, the bears may target range lows around 2,000.
To play this setup with me, you are also welcome to follow me on Twitter, where I’ll keep sharing my personal trades.
This post was last modified on Oct 10, 2023, 10:25 BST 10:25