Trade Idea of The Day - Oil and Natural Gas Corporation Ltd Target Rs. 10 - Religare Broking Ltd
Oil and Natural Gas Corporation Ltd
BUY 28 JUL 235 CALL SELL 28 JUL 250 CALL Entry Range 4.8 – 5.2 Target 10 Stop Loss 2
Rationale
1. On the weekly chart ONGC is showing signs of a bullish reversal near the crucial support zone of 228-230, which has aligned with the long term moving average of 200-WEMA. In the previous session the stock prices has managed to stabilize after a sharp correction.
2. The RSI has slipped into the oversold territory, indicating exhaustion in selling pressure. Historically, such oversold readings often lead to a technical pullback or a relief rally in the near term.
3. The formation of long lower shadows near the support zone suggests buying interest emerging at lower levels. Sustaining above 230 zone could help the prices to regain momentum and attract fresh buying interest.
4. In the near term, immediate relief rally is expected towards the 100-WEMA zone, aligned with the 250-255 Zone. Any breakout above this zone, may confirm the robust reversal setup and open the doors for a strong upside recovery.
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