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RIL rallied to Rs 2,329 in line with our expectation and reversed from there forming a giant engulfing candle. The long-term moving averages and the down trend-line present in the band between Rs 2,270 and Rs 2,320 make it a key resistance zone. The stock can fall to Rs 2,080 in the near term. However, the near term outlook will turn negative only if this support is breached.

As we have been reiterating, the medium-term outlook for the stock stays negative. The fact that the stock has completed 30 per cent retracement of the down-move from January peak denotes that the medium-term down trend can resume and pull the stock lower to Rs 1,900 and then Rs 1,720.

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