The Hindu Business Line : Reliance Petroleum (Rs 136.45): Sell

We recommend a sell in Reliance Petroleum stock from a short-term trading perspective. It is evident from the charts of Reliance Petroleum that it was on an intermediate-term up-trend from its 52-week low of Rs 68 (recorded in early March) till it encountered significant resistance at Rs 150 in late May. After hovering below the long-term key resistance at Rs 150 for a month, the stock failed to break through this resistance. Triggered by negative divergence displayed in the daily and weekly relative strength index, the stock reversed direction. On June 15, the stock conclusively broke through the intermediate-term up-trend-line as well as 21-day moving average by retreating 7 per cent. Volume traded was high during this decline. The daily RSI is declining in the neutral region and weekly RSI is on the brink of entering this region from the bullish zone. We are bearish on the stock from a short-term horizon. We anticipate the stock’s decline to continue until it hits our price target of Rs 122 in the approaching trading sessions. Traders with a short-term perspective can sell the stock while maintaining a stop-loss at Rs 143.

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Reliance Petroleum (Rs 136.45): Sell

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