Reliance Infrastructure Limited (NSE:RELINFRA, BOM:500390) is one of the heavily beaten down stock in the first quarter of 2013. During this period the stock went down from 572 50 to 315.00 levels. Its not only Reliance Infra, almost all Ambani group stocks such as Reliance Capital, Reliance Communications, Reliance Power and Reliance Media went down like anything.
During the last one month, the stock was in range bound to upward momentum. The 20% move from the bottom is likely to be continued for near term. Its highly likely that the stock will move up to the Fibonacci Retracement of last fall which comes around 473.00. One can go long with Reliance Infra with target of 473 and stop loss of 364.
On a closing basis, the stock closed at 387.90 on Thursday.
Reliance Infra forms Evening Star in the candlestick chart. Evening star is most reliable bullish trend reversal pattern. In the last one month the stock has rallied from 444 levels to 530 levels. Though last day trading has formed little green body candle, it could be considered as bearish till it goes above 525 levels.
Reliance Infra showing Evening Star pattern in candlestick pattern
The Heikin Ashi chart (modified candlestick chart) is started showing trend reversal sign. A doji and then followed by two red color candle body is inevitable that the stock will go down further.
Reliance Infra showing trend reversal in Heikin Ashi chart
Reliance Infra is in down trend RSI indicators. The MACD indicator is very near the level zero. It could turn into negative signal in a day or two. The 200 days moving average is around 514 mark, which is just three points below the Monday closing of 547.25.