RELIANCE: Can get you GREAT RETURNS!RELIANCE INDUSTRIES is the King of the Indian Stock Market and everyone knows about what role Reliance plays in India.
RELIANCE Stock has been in a consolidation since more than 2 years and is now trying to Breakout.
Let us first know about its Basic Fundamentals.
Profits are rising every year which is the most important point.
Balance Sheet is growing year on year.
Reserves are more than Borrowings.
FIIs & DIIs have increased stakes in June Quarter.
Fundamental Score is 7/9
Why Fundamentals?
It is always safe to trade in Fundamentally good stock.
Now Next, Let us look on the Nifty Chart:
Nifty has corrected for 4% from high and meanwhile Reliance was consolidating at the top, preparing for a Breakout. Nifty's fall did not affect Reliance, and Reliance was quiet for some days. But now Nifty has tested its support and we can see a positive hammer candle at the support. This can be a positive news for some days as Nifty can retrace upside.
Now, Reliance is part of NIFTY ENERGY Sector and weighs 57% in NIFTY ENERGY.
Let us see NIFTY ENERGY SECTOR Chart:
NIFTY ENERGY Sector chart has given a Flag and Pole Breakout in Weekly Timeframe which shows that Energy Sector can be bullish for few months. It has taken support of 0.382 level of Fibonacci, which is a great support.
As we can see, Nifty and Nifty Energy Sector can be bullish for few weeks here on, we can find the stock that is also bullish and is a candidate of Breakout.
And so we find RELIANCE.
Overall Reliance was consolidating from long, and now is trying to give breakout. It has made a good Box Breakout type of pattern and making a simple price action near the breakout level, which means it is gaining some energy to blast off.
In past few weeks, Nifty corrected about 4%, but reliance did not show any weakness, which is another reason to select Reliance.
Some weeks ago, it gave a breakdown of the trendline but it was a fake move and now reliance has moved up, taking the StopLosses of all those who made a short position on the basis of trendline Breakdown.
Track Reliance in near term, as after breakout we can see a good upside possible.
Our First Target will be 2900!
Keep Reliance in your Watchlist!
