The stock of Indian Oil Corporation fell by 2.8 per cent with low volume on Wednesday breaching the 21-day moving average. Investors with a short-term horizon can sell the stock at current levels.
After a short-term uptrend from the February low of Rs. 121, the stock encountered a key resistance at Rs. 165 in late March this year. Subsequently, the stock changed direction triggered by negative divergence in the daily relative strength index and price rate of change indicator and began to decline. Moreover, the key resistance at Rs. 165 also limited the upside. There has been a decline in daily volumes over the past one week.
The short-term uptrend is weakening. The daily price rate of change indicator hovers in the negative terrain, implying selling interest.
