In this Analysis of Reliance Industries Limited, we are going to analyze the reliance share price as of today and the probability of various consequences.
Main Questions are are going to cover here are:
- What is RIL Share?
- Latest News in Reliance Industries?
- Why are Reliance shares falling?
- Why are Reliance shares falling?
- Is Reliance Good to buy for the Long Term?
What is Reliance Industries?
Reliance Industries Limited is one of the Fortune 500 Company (96th as per 2020 Data) and the largest private Sector Corporation of India.
This Post will not be enough if we talk about the whole company you can visit RIL website to know about the company in detail.
For now let’s understand briefly that company is engaged in energy, petrochemicals, textiles, natural resources, retail, and telecommunications
Why are we talking about Reliance Industries Today?
One of our viewers asked about doing technical analysis on reliance industries. So, here we are doing our best for the loved ones.
At the time We were preparing this Blog the market fell sharply:
Nifty 50: 14925 (-196)
Bank Nifty: 35692 (-904)
Vix: 22.64 (+5.11%)
But Reliance is facing the market very well. So, that means reliance will rise if the market recovers tomorrow? HELL NO!
Although I can still see some share with a positive sign like IDFC First Bank, Dhani, Gujarat gas, etc. and mostly everything is in red.
Latest News in Reliance Industries
Reliance Marcellus, LLC (“RMLLC”) a wholly owned subsidiary of Reliance Industries Limited (“RIL”) (i.e. RIL has 100 % Equity in RMLLC), announced the signing of agreements to divest all of its interest in certain upstream assets in the Marcellus shale play of southwestern Pennsylvania. These assets, which are currently operated by various affiliates of EQT Corporation (“EQT”), have been agreed to be sold to Northern Oil and Gas, Inc (“NOG”), a Delaware corporation, for a consideration of $250 million cash and warrants that give entitlement to purchase 3.25 million common shares of NOG at an exercise price of $14.00 per common share in next seven years. A Purchase and Sale Agreement (“PSA”) has been signed between RMLLC and NOG on February 3, 2021 for this sale and the transaction is subject to customary terms and conditions of closing.
Scheme of arrangement between reliance industries limited & its shareholders and creditors and reliance O2C limited & its shareholders and creditors
This scheme of arrangement between RIL & its shareholders and creditors and O2C Subsidiary & its shareholders and creditors, the scheme provides for
(a) transfer of the O2C Undertaking from RIL to O2C Subsidiary on a Slump Sale basis; and
(b) reduction of capital
This Scheme also provides for various other matters consequent and incidental thereto.
Reliance O2C Limited is a company incorporated under the Companies Act, 2013 (“Transferee Company” or “O2C Subsidiary”). The equity shares of O2C Subsidiary are not listed on Stock Exchanges and O2C Subsidiary is a wholly-owned subsidiary of RIL.
In the Daily Candlestick Chart, we can see that Reliance is in a range bound within RS. 1700 to Rs. 2100 (approx.).
Right now the share is trading at Rs. 2094.65 and with the market looking weak there might be a possibility of RIL making the base of 200 Day moving average.
The share is cold for many days and might show some momentum in the direction of the price outside the range (1700-2100).
RSI and MACD
Even the Relative Strength Index and MACD did not show any movement nor volume of any kind excites about getting into a trade.
For now one should not execute a trade within the range as the market is highly volatile and an unexpected move might see for a few days in the market.
Now we have seen in the daily chart now ZOOMING OUT, let’s analyze the weekly chart for further clarification.
With the weekly chart, we can see the Reliance share has recently made a base on the 50 Week Moving Average (around 1800) and 3 green candles which show a positive sign for the company to move even further to 2300.
With understanding the Daily and Weekly chart combined we have a better probability of share going to rock if it closes above 2100 and it can be held till the immediate target of 2300 but the target is too small and the risk-reward ratio is also not favorable with this share. So, trading at this price is not looking like a viable option.
If still, someone wants to trade it is better to buy at a dip (around 1700/1800) and sell high (2100/2200).
Disclaimer: This is not a stock recommendation to buy or sell or to take any position on any trade. This to share my view for learning and education purposes. Please take the decisions consulting from your financial advisor.