Reliance Industries’ (₹2,921.50) outlook turned positive after it managed to break the strong resistance at ₹2,800 in the recent rally. If the current trend sustains, this stock has the potential to reach ₹3,320 and even to ₹3,635.

On the other hand, if Reliance turns weak from its current level, it can find support at ₹2,735 and ₹2,575. A close latter will change the outlook negative for Reliance Industries.

F&O pointers: Reliance February futures closed at ₹2,926.75 against the spot price of ₹2,921.50. Open interest for the contract slipped to 3.3 crore shares from 3.40 crore shares on January 31.

The fall in open interests and narrow premium of about just ₹5 for the futures suggest that traders remain cautious and booked profits on every rise.

Strategy: Go long on Reliance futures for a target of ₹3,250. Stop-loss can be placed at ₹2,735 initially. If the stock opens firm and moves above ₹2,950, then the stop-loss can be shifted to ₹2,926. The stop-loss can then be altered to ₹2,960 if the futures move above ₹2,985.

According to individual risk-taking ability, traders can shift the stop-loss from there on to protect the profit.

This strategy is risky as the loss potential is high if the stock moves in the opposite direction swiftly. So, this strategy is for high risk-appetite traders.

Follow-up: Hold HUL bull-call spread for one more week and then, it can be reviewed.

Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading