Will Reliance Go Up or Down on August 6, 2020? Factors Influencing the Stock Movement
On the 5th of August 2020, the Reliance stock experienced significant correction. This downward movement might suggest a potential rebound on the 6th of August, depending on the support from global market cues, the stock's position above its moving averages, and the upcoming earnings report. Here, we delve into the factors that might influence the Reliance stock's movement and potential strategies for traders considering the upcoming trading session.
Market Sentiment and Global Cues
Market movements are often influenced by both internal and external factors. On 6th August, the Reliance stock might open on a positive note, buoyed by supportive global market cues. Additionally, the stock has been sustaining above its key moving averages, signaling a bullish outlook for the upcoming trading session. However, the gains are capped as the stock is trading near its lifetime high, suggesting a potential for less upward momentum.
Impact of Earnings Report
The earnings report for Reliance is a crucial variable in determining the stock’s movement. There are two possible scenarios based on the overall sentiment after the earnings:
Good Results: If the results are excellent or good, the overall sentiment will be bullish, leading to more buying interest and pushing the stock price higher. Bad Results: Even if the results are modestly bad, the stock might not experience a significant drop due to the strategic buying behavior of traders. The stock is likely to find support around the 1900 level, acting as a significant defense line. If it falls below this level, it could potentially drop to 1610 in a worst-case scenario.It's important to note that traders and speculators often anticipate the earnings report ahead of time. Therefore, the impact on the stock might not be as pronounced as expected, positively or negatively. Before the report, the stock may experience heightened volatility, so investors and traders need to be cautious and prepared.
Technical Indicators and Short Term Strategies
The closing price of the stock on a bearish candlestick might indicate the potential for an upward movement, should a bullish candlestick form the next day. Momentum indicators also suggest a possible up move in the stock. Additionally, Futures and Options (FO) traders are likely to cover their shorts and rollover their existing derivative contracts. This behavior is expected to contribute to the upward pressure on the stock price.
Given these factors, investors and traders should keep a close eye on the stock's movements in the coming days. It's crucial to perform detailed analysis and make informed decisions based on your own research and financial advice. Any trades or investments should be made with a clear understanding and analysis of the potential risks and rewards.
Thank you for your interest in investing and trading. Happy Investing and Trading!