Reliance Industries surged strongly to a 15 per cent weekly gain, shattering the resistance at Rs 1,400 as well as Rs 1,500 with ease. The medium-term view has turned positive with the weekly close above Rs 1,500.
The sideways move between Rs 1,000 and Rs 1,400 since October 2008 appears to be a terminal corrective. Medium-term targets for the stock have now been revised upwards to Rs 1,647 and Rs 1,820. Caveat: these targets are achievable only if the stock holds above Rs 1,500 over the next couple of weeks.
RIL paused just below its 200-day moving average on Friday. A correction can now ensue that takes the stock lower to Rs 1,400 or Rs 1,330. Traders should avoid fresh longs on a decline below Rs 1,380.