Brent tops $130. Fuel hike on cards? Trading strategies for RIL, ONGC, OMCs

ONGC is set to gain another 12 per cent in the upcoming sessions, while other oil related stocks show weakness.

Equity markets across Asia traded with significant losses on Monday, amid worries over the duration of the war between Russia and Ukraine and its prolonged impact.

Oil prices soared more than 10% in hectic trading on Monday as the risk of a U.S. and European ban on Russian product and delays in Iranian talks triggered what was shaping up as a major stagflationary shock for world markets. Brent was quoted $12.73 higher at $130.84, while U.S. crude rose $9.92 to $125.60. READ ABOUT IT HERE

Shares of Oil and Natural Gas Corporation (ONGC) rallied 5 per cent to Rs 172.65 on the BSE in Monday’s intra-day trade in an otherwise weak market on the back of rising crude oil prices. Rising oil prices may prompt the government to sharply hike the prices of petrol and diesel this week post the assembly elections across five key states get over.

Here are trading strategies for oil-related stocks.

S&P BSE OIL & GAS
Outlook: Indecisive

The current scenario displays a trendline hurdle at the 18,000-mark and the index failed to conquer it. Every significant decline below this crucial hurdle might invite additional selling pressure. Present sentiment appears indecisive as the index hovers around the 200-day moving average (DMA). The 200-DMA is placed at 17,413.  CLICK HERE FOR THE CHART

Oil & Natural Gas Corporation Ltd (ONGC) 
Likely target: Rs 200
Upside potential: 12%

Shares of Oil & Natural Gas Corporation broke out of the “Golden Cross”, as per the weekly chart. A crossover of the 50-weekly moving average (WMA) with 200-WMA reflects a bullish bias. Now, the stock needs to overcome the obstacle at Rs 175 and when it does that, the next rally could see a target of Rs 200. The immediate support comes to Rs 165 and Rs 155 levels.  CLICK HERE FOR THE CHART

Hindustan Petroleum Corporation Ltd (HINDPETRO)
Outlook: The trend is sideways, but losing Rs 260 could see decline

The stock is trading well below the 200-DMA, currently placed at Rs 290 level. Selling pressure in the range of Rs 290 to Rs 285 needs to be overcome to breakout on the upside, cited by candlestick patterns on the daily chart. The current trend is sideways, rather indecisive, but any drop below Rs 260 could see an accelerated weakness.  The Moving Average Convergence Divergence (MACD) trades below the zero line, showing a losing momentum.  CLICK HERE FOR THE CHART

Bharat Petroleum Corporation Ltd (BPCL)

Likely target: Rs 320
Upside potential:  6%

The daily chart indicates a clear resistance at the Rs 355-level, a breakdown mark which was the support of the last reversal. The trend is weak and the stock seems headed towards the next support of Rs 320, which is its 200-WMA.  CLICK HERE FOR THE CHART
 
Reliance Industries Ltd (RELIANCE)
Outlook: support is at Rs 2,200

Reliance Industries shares managed to rebound above 200-DMA recently, but then failed to overcome the hurdle at Rs 2,450 level, which is its 100-DMA. This average has been a consistent resistance in the month of February 2022. Going forward, any decline below the Rs 2,200 level, a sentimental mark now could result in further downside, currently acting as a major support.  CLICK HERE FOR THE CHART