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RIL sky-rocketed to Rs 2,490 on Tuesday morning before a bout of selling dragged it lower. The stock surpassed our second medium-term target of Rs 2,384 on Tuesday morning, but closed been well below this level. This is a key intermediate term resistance for RIL. A reversal from this level can drag the stock lower to Rs 1,700 or Rs 1,500 over the medium-term. We advise caution from a medium-term perspective unless the stock records a weekly close above Rs 2,400.

The short-term trend in the stock is down but the gap between Rs 1,960 and Rs 2,100 formed on Monday morning will provide support. Stop-loss for trading longs can be at Rs 2,080. Resistances for the week ahead would be at Rs 2,248 and Rs 2,340.

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