NIFTY OIL_AND_GAS

The NIFTY OIL And Gas index has witnessed a vertical fall from January 2023 high at 8671 and in the process has retested the lower band of the prolonged sideways consolidation that began from the February-2022 low at 6943 level.
The price correction that led to a sharp fall of more than 17 percent on the overall basket has halted at or around the lower support region formed joining the earlier swing lows at 6943 (Feb-2022) & 7007 marked as on June 2022.
Since the correction was too quick, an unexpected bounce at this point in time cannot be ruled out and there is visibility for the same by looking at the chart structure.
Looking at the candlestick pattern on the daily scale, which exhibits a longer wick and a short body on the higher side hints that the buyers getting attracted at the current juncture.
Although, the reversal could only be validated once the OIL & GAS index closes or starts trading above the level of 7300 going forward.
Most of the index heavyweights like RELIANCE, ONGC, BPCL, IOC, and GAIL are showing healthy signs of a short bounce and are also offering a short-term buy opportunity at the current juncture.
All others except the ADANI Total Gas which has witnessed a sharp fall led mainly by negative news flows across the Adani Group, offer an investment opportunity over the next few months.
Looking at the overall technical setup, we are convinced with a decent bounce from current levels and hence would see a minimum upside of near about 7 to 10 percent on the index front.
Also, for a valid entry, the index needs to surpass the 7300 mark decisively which provides additional confirmation for the longer bets going forward.