Charts indicate robust bias for RIL, ONGC amid GST inclusion hopes

Oil & Natural Gas Corporation and Reliance Industries can rise up to 8 per cent

At the 49th GST council meeting, the Finance Minister Nirmala Sitharaman stated petroleum products such as petrol and diesel could be included under the Goods and Service Tax (GST) regime once the states government agree to it. She also added, GST council members need to finalize a rate before petroleum products are added under GST. 

Meanwhile, Nifty Oil and Gas index has remained a top loser so far this year, declining over 14 per cent. However, a few of its constituents, like Oil & Natural Gas Corporation, Indian Oil Corporation and Oil India have succeeded in scaling crucial levels. So far this year, Oil India is up 25 per cent, while Oil & Natural Gas Corporation and Indian Oil Corporation gained 6 per cent and 5 per cent, respectively.

Barring Reliance Industries, all other constituents like Hindustan Petroleum Corporation,  Bharat Petroleum Corporation and Oil & Natural Gas Corporation lost over 0.50 per cent on Monday. Reliance Industries was seen trading flat. 

Here’s the technical outlook on oil-related stocks:-

Nifty Oil and Gas Index (NIFTYOILAN) 

Outlook: Current trend is weak
 

The recent rout in the Nifty Oil and Gas Index has now dented the upward bias. If the weakness persists and breaks 7,000 mark, the index may enter a medium-term bearishness. While the index fell in the oversold territory of the Relative Strength Index (RSI), the index price action does not expect any smart reversal. Only if the index surpasses, 7,500 mark, the upward bias may see some positive vibes. Below 7,000 mark, the index may decline to 6,900 – 6,850 levels.' CLICK HERE FOR THE CHART

Oil & Natural Gas Corporation Ltd (ONGC)  

Likely target: Rs 170

Upside potential: 8%

Shares of Oil & Natural Gas Corporation have seen a gradual upside since October last year, and are currently attempting to major hurdle of Rs 155. A conclusive close over the same could trigger a fresh upside in the direction of Rs 170. The immediate support for the stock exists at Rs 150 levels. 

Technical indicator, the Moving Average Convergence Divergence (MACD) has formed a positive crossover right entering the zero line, reflecting a positive momentum in the upward bias.  The medium-term outlook is well-placed over the support of Rs 140. Only a breach of this mark could let bears to engulf the positive bias. CLICK HERE FOR THE CHART

Bharat Petroleum Corporation Ltd (BPCL)

Outlook: Major breakout over 100-WMA

Until the shares of Bharat Petroleum Corporation overcome the hurdle of 100-weekly moving average (WMA), the bullish bias may not entice the follow-up buying. While the current trend points to a resilient structure, as the MACD leaped over the zero line; the stock price action is unable to carry forward the upside momentum. A breakout over Rs 355, its 100-WMA, could spark a rally towards Rs 385.

The daily chart suggests immediate support to be at Rs 320 levels, followed by Rs 305. The broad trend reveals a sideways move, striving to form a lower base.  CLICK HERE FOR THE CHART

Hindustan Petroleum Corporation Ltd (HINDPETRO)

Outlook: Bullish bias to trigger over Rs 260 level

Shares of Hindustan Petroleum Corporation struggled to conquer the barrier range of Rs 255 to Rs 260 levels since September last year. This weakness is now gradually taking over the positive bias. If the stock breaks immediate support of Rs 220, it may slip to Rs 200 levels. 

On the other hand, a breakout over Rs 240 may see an upward move to Rs 260 levels. CLICK HERE FOR THE CHART

Reliance Industries Ltd (RELIANCE)

Likely target: Rs 2,650

Upside potential: 8%

Shares of Reliance Industries may breakout once the trendline hurdle at Rs 2,450 is crossed, with robust volumes. When this happens, the stock may rally towards 2,650 levels. The current bullish bias is intact over the support of Rs 2,300. Immediate support comes to Rs 2,370 levels. CLICK HERE FOR THE CHART