How to trade Ambani, Adani stocks before Lok Sabha election outcome?

Caution advised at Ambani and Adani group stocks, as Reliance, Jio Fin, Adani Enterprises and Adani Ports trade at key support levels, show technical charts.

Ambani and Adani - two of the biggest business houses in India became the talking point in the country, amid the ongoing Lok Sabha elections, following a jibe by the Prime Minister Narendra Modi at the opposition leader.

While addressing an election rally in Telangana, Modi questioned why the Congress leader Rahul Gandhi has suddenly stopped talking about Ambani and Adani? 

Corporate India leaders expressed surprise at Modi's remark, yet others believed that such statements were made in the heat of elections and nothing major should be read into it. READ MORE

Meanwhile, we are in mid-way through the general elections, with voting for 3 out of the 7 phases concluded as of May 07. The fourth phase of elections is scheduled for May 13 in Madhya Pradesh, Odisha and Jharkhand. The election results will be announced on June 04.

Off late, equity market in India have been volatile owing, with India VIX rising to a 15-month high amid concerns over the margin of victory for the Narendra Modi-led Bharatiya Janata Party (BJP) government. 

Market experts recommend that the low voter turnout so far has triggered speculation that the ruling coalition's seat tally would be lower than last time around. READ MORE

Given the uncertainty around the likely market direction, here's a technical outlook on key Mukesh Ambani and Gautam Adani group shares.

Reliance Industries

Current Price: Rs 2,824

Downside Risk: 7.4%

Resistance: Rs 2,920; Rs 29,70

Reliance Industries stock has declined 8 per cent from its high of Rs 3,024, and is currently seen testing support around its 20-WMA (Weekly Moving Average) - a level it has held since late November 2023. The 20-WMA presently stands at Rs 2,858. Couple of weekly closes below the same, shall open the doors for an extend dip towards the super trend line support at Rs 2,690 or further lower towards the 50-WMA at Rs 2,616. 

For a positive trend to emerge, the Reliance Industries stock will need to sustain consistently above the Rs 2,858 level, following which a pullback to Rs 2,920 and Rs 2,970 seems possible. CLICK HERE FOR THE CHART

Jio Financial Services

Current Price: Rs 352

Downside Risk: 5.7%

Resistance: Rs 371

Jio Financial Services stock is trading at a crucial juncture, testing support at its 50-DMA (Daily Moving Average) which also coincides with the super trend line support on the daily chart. The stock has been respecting the trend line support since February. Given signs of stability on the RSI (Relative Strength Index) indicator, the stock may once again find support around these key levels.

As such, Jio Financial Services stock can spurt back to its 20-DMA at Rs 371. Real strength at the counter can be expected only on sustained trade above the 20-DMA. On the flip side, break of super trend line support can trigger a dip to Rs 330 levels. CLICK HERE FOR THE CHART

Adani Enterprises

Current Price: Rs 2,861

Downside Risk: 3.5%

Resistance: Rs 3,064; Rs 3,085; Rs 3,143

The price-to-moving averages action reveals a negative bias for the Adani Enterprises stock. Adani Enterprises has been trading below its short-term moving averages for nearly a month now. Further, the 100-DMA at Rs 3,085 is now seen ascending above the 20-DMA and 50-DMA at Rs 3,064 and Rs 3,143, respectively. This shall further weaken the chart structure.

On the other hand, Adani Enterprises stock is now trading close to its long-term support, which stands at Rs 2,762. Select momentum oscillators like the MACD (Moving Average Convergence-Divergence) are in oversold zone, hence some consolidation and a pullback from the support level can be anticipated. As such, the stock may bounce back to short-term moving averages on the upside. CLICK HERE FOR THE CHART

The weekly chart too shows presence of multiple supports around RS 2,750 and Rs 2,715 in the form of 100-WMA and 50-WMA.

Adani Ports

Current Price: Rs 1,285

Downside Risk: 11.3%

Resistance: Rs 1,330; Rs 1,350

Adani Ports stock is seen testing support around its 20-WMA at Rs 1,270. However, the key momentum oscillators are clearly in favour of the bears, hence the stock may break the 20-WMA support in the near future. Post which, the stock a fall to Rs 1,140 level seems likely. In the interim, daily chart suggests presence of support around Rs 1,240 - the 100-DMA.

Having said that, the overall bias is likely to remain negative as long as the stock trades below Rs 1,330 - Rs 1,350 resistance zone. CLICK HERE FOR THE CHART

Adani Green

Current Price: Rs 1,780

Bias: Range-bound

Broader range: Rs 1,650 - Rs 2,000

After three weeks of consolidation around the 20-WMA, this week the Adani Green stock is seen trading below the key moving average. However, the key momentum oscillators indicate lack of strength at the counter. Hence, the stock may trade sideways and attempt to claw its back above the 20-WMA at Rs 1,807 level.

The broader trend suggests that Adani Green may enter a phase of sideways trade in the range of Rs 1,650 - Rs 2,000. CLICK HERE FOR THE CHART