Reliance Industries... Major Reversal... A Classic Case of Double Bottom...
Reliance Industries...A heavy weight stock of all major Indian indices, was in downtrend since quite some time.
Since June 2014, the stock is in continuous downtrend from the level of 1140. It recorded high of 1145 on 16th May 2014, though it is not the all time high. After achieving 1145 on 16th May-2014, the stock had recorded value very near to the previous high (1140 Rs) on 26th Jan- 2015. From here, it went down below 1000 level, and came back to 1130 on 6th Jun, 2014.
After achieving this high range of nearly 1130-1140, the stock was in downtrend. It came down up to 832. Almost 313 Rs from high achieved, which counts 27%. While this down trend, the stock has shown number of swings on the chart, but after every up move, fresh supply was observed and downtrend continued.
In the downtrend, the counter hit low of 832-831 first on 6th Jan-2015 and again on 14th Jan-2015. Closing value on 14th Jan was 834.95 The reversal begin on 15th Jan-2015 where it opens at 840 and closed at 864. The upmove begins.
It went high up to 905.55 on 20th Jan-2015 and closed @ 903.05 on the same day. The rally was of 60-65 Rs from closing of 834.95 in just 6-7 days. The counter again enter in consolidation for next 4-5 sessions and hits high of 909.8 on 28th Jan-2015. It closed at 906.85 on the same day indicating breakout on the charts. Again the upmove started and it achieves high of 943.8 on 4th Feb-2015. It counts approximate 11.5% profit in just 14 days. Excellent... What else can a short term trader expect from markets?
After achieving high of 943.8, it came down and closed at 909.9 on Friday, 6th Feb-2015. We can see a major support for this counter in short term is at 906. If it continue to remain above this level, we can definitely see the upmove further and the immediate next target will be 975.
T1: 975 (Appx 7% Profit)
T2: 1050 (Appx 15% Profit)
T3: 1125 (Appx 23% Profit)
For T1: 10 - 15 days
For T2: 30 - 40 days
For T3: 60 - 75 Days
We recommend to stay invested if it stay above 906 in next week and follow till the targets achieved. For Stop Loss of Profit Booking, investor may rely on EMS combination of 4 Days, 14 Days and 26 Days.
Happy Trading....Trend is Friend...
- Anand Singh Gaur
- Sunil Kothari