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The stock moved down to our first target at Rs 2,230 before staging a recovery last week. The fact that the 200-day moving average line went unchallenged last week is a positive. But the medium term trend in the stock continues to be down. Reliance Industries appears to be in the second leg of the correction that began at Rs 3,252. Failure to move above Rs 2,700 will reinforce this assumption and open the possibility of a fall below Rs 2,100. But long-term investors can buy the stock below Rs 2,100.

This bearish outlook will be mitigated only on a move beyond Rs 2,850. Short-term traders should stay watchful till the stock closes above the second resistance. The supports will be available at Rs 2,230 and then Rs 2,120.

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