WE DON'T JUST CLAIM THAT WE ARE PREDICTORS BUT ONLY ANALYSTS AND LIKE MOST OF THE TIMES WE PRESENTED YOU THE COMPLETE CHART TO EXPLAIN WHY WE ARE SAYING THAT
R COM MOVED EXACTLY AS WE ADVISED TARGET IS HUGE
READ OUR VERY DETAILED REPORT SEND TO CLIENTS ON FEB 4TH 2014
TO BUY RCOM NEAR 110 WITH SL 105 IT HIT LOW OF 105.90 SEE WHERE THE STOCK IS TODAY 150+
The simple question: Is Reliance Communication stock BUY, Sell or Avoid?
Let us look at the Chart of Reliance Communications
Reliance Communications stock went through really bad time during Telecom sectoral mess b/w 2008-2012 when it tanked from levels of 800 to 50. During decline: the stock created a well defined resistance around 110-115.
In 2013: the stock made first attempt at meaningful recovery from 50 and by September 2013 – the stock rallied all the way to 165. It was a dramatic move and created enormous buzz from breakout to turnaround. It’s interesting that post Sep 2013, Rcom stock has under performed the market. From Highs of 165 – the stock has pulled back to 120. And people are asking: Is the story over? Was that one off move?
The Big Question: Technically – Where is the Support for the stock?
Rule # 1: Breakout Support
The Trading rule says: When a stock makes first breakout move by moving past resistance: the pullback to previous resistance/breakout point must act as support. Based on this rule: Reliance Communications should find buying support near 110-115
Rule # 2: Turnaround Support
The Trading rule says: A long term turnaround happens in the stock when it moves past 200 week moving average. Reliance Communication stock has done that and hence pullback to 200 wma should act as support point. Technically, that level is at 107
Rule # 3: Retracement Support
The Trading rule says: The Fibonacci retracement is the potential retracement of a stock’s original move in price. These levels are created by drawing a trendline between two extreme points and then dividing the vertical distance by the key Fibonacci ratios of 23.6%, 38.2%, 50%, 61.8% and 100%. The popular support lies at 50% to 61.8%. As per the chart: 50% Fibo retracement lies at 108 on Rcom chart.
WHAT DOES THIS ALL MEAN?
Reliance Communication stock has convergence of support b/w 107 and 115 on weekly chart and technically, stock should hold this level if stock is genuinely turning around. Reliance communication believers can buy the stock b/w 110-116 with closing stop loss below 105. If stock slips and closes below 105, then one should just give up on the stock.
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