Ril Views!!!

Last week RIL has really lead the NIFTY, the relative strength chart below is a clear proof of that.

However the weekly chart of RIL below has some surprises. Interesting resistance is developing at the fib confluence (marked on the chart), there is a bearish crossover of the 20 and the 200 periods MA’s, in short, 1450 and 1500 looks a terrible place! There is a kind of hidden negative divergence in the making here with the indicators moving higher but the price is failing to move with the momentum. RIL needs to protect 1135 at all costs on closing basis infact monthly close better be or has to be above 1135 if one has any bullish fantasies on RIL! I would rather like to see a clear bullish divergence on the weekly MACD before getting gung ho about RIL.

The daily chart below has RIL closing at the 20 periods MA with a strong historical resistance at 1280 staring down at it; this is where incidentally the 50 periods MA is also residing. Any foray to go long in RIL above 1220 should be done with a strict stop at 1180 region, or better still if there is some intraday pullback to 1190/1200 then that would be ideal to play a small swing.

Why I spoke about intraday pullback, because on the hourly chart below we can see the Price stalling at the 200 periods MA along with the 50% fib retracement. Immediate support below is in the form of the 38.2% fib and the 50 periods MA! There is a slight negative divergence in MACD histogram and stoch is already at 90! Personally I would be following RIL next week to see how it plays and where I need to improve upon my analytical skills!

"Continuous effort, not strength or intelligence, is the key to unlocking our potential."

Liane Cordes