Reliance Industries forms evening doji star pattern

The stock of Reliance Industries Limited has formed an evening doji star candlestick pattern on the daily time frame. Evening Doji Star is a reversal candlestick pattern which is bearish in nature and appears at the end of an uptrend. It is a complex pattern made up of three candles; the first candle is bullish in nature, the second is indecisive and the third candle is bearish in nature.

Along with this bearish formation, the stock has also managed to close below its weekly pivot and short-term moving average, i.e. eight-day EMA. Among the momentum indicators, the 14-period daily RSI cooled off after touching the zone of 75 and at present, its reading is 61.44. The RSI is trading below its nine-day average and is in a declining mode, which indicates a further downside momentum. The stochastic oscillator has also given a bearish crossover.

Moreover, Ichimoku chart on 60-minute time frame is clearly giving a negative view as it closed below the KS and TS lines. Another important aspect is that the TS line crossed under the KS line, which is also a bearish sign. 

Going ahead, if the stock sustains below Tuesday’s session low of Rs 1,465 and trades convincingly below this level, then there is a high probability that Monday’s high point of Rs 1,615 would become a temporary top for the stock. 

On Tuesday, the stock of Reliance Industries closed at Rs 1,479.25 per share, dipped by 6.19 per cent. The stock opened at Rs 1,564.80 per share and hit an intraday high of Rs 1,568.35 and a low of Rs 1,465 per share on NSE.