Reliance Industries – SEBI Fines Mukesh Ambani, Stock Prices Didn’t Care!

  • Stock Market Analysis
  • Editors Pick

There is a famous saying in the markets – “During Panic, all good news is considered as Bad news, during euphoria all bad news is firmly neglected.” Sentiments and narratives are strong forces that drive the Price Action regardless of fundamentals. Markets often play according to the tunes of crowd psychology. People’s thinking and decisions most of the time are shaped by Price action and narratives.

Take a look at this Image; it simply depicts how an average trader/Investor thinks about the market in response to the Price Action in Different market stages.

Thought Process of a Trader in relation to Price Action
After looking at the Image, Now read on…

This weekend there was a news report about Mukesh Ambani, the infamous chairman of Reliance Industries (NS: RELI ) getting fined by SEBI for 2007 manipulative trading practices. Despite the significance of such news, Reliance Industries stock prices didn’t even flinch a little. Dalal Street didn’t care! Take a look at the chart over here.

Reliance Industries - Stock Prices didn't respond for the negative news

Just imagine, if the same type of news headline about a Small Cap or Mid Cap Company, What would’ve happened? The Company’s shares will be in deep red turmoil on the next second. If you think about it, you can’t help yourself but wonder about the present market situation.

Not only that, Price Action showed many signs of Uptrend losing strength – Momentum Shift, Unexpected selloff, Decreasing trading volume etc. but still, we couldn’t see any strong selling pressure in Reliance Industry Stock prices.

When you think based on the earlier point I mentioned about market narrative and Crowd Psychology – Did that Imply, we are in the beginning stages of Market Euphoria? What’s your thought? Let me know in the comments!

Original Post

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  • Chandra Sekaran @Chandra Sekaran
    buy on dips market going on
    Like 0
  • Ajay Uppal @Ajay Uppal
    Really don't understand how FIIs and US investors are sticking to such investments in spite of Ethics issue and manipulative trading practices.. The 2007 case getting concluded in 2021 also shows how poorly our regulators perform.
    Like 2
  • Kaustab Kind @Kaustab Kind
    Excellent thought piece as usual. I like your line - "Just imagine, if the same type of news headline about a Small Cap or Mid Cap Company, What would’ve happened?". Truth. Market is not looking at the flip side of reliance.
    Like 1
  • Saurabh Makkar @Saurabh Makkar
    I day early you wrote it I guess 😅
    Like 4
  • arman aateef @arman aateef
    yes sir, exactly happing always with retail traders.
    Like 0
  • Deepak Ahuja @Deepak Ahuja
    This is not an article but overcrowded opinion to a headline. No details about why he was fined.
    Like 7
  • sourav sethy @sourav sethy
    Mr Ambani is fined Rs 25 crores which is like peanuts for Reliance. Moreover, Mr Ambani is a good businessman. Investors believe in their strong governance and vision , so still bullish for long term.
    Like 6
  • sourav sethy @sourav sethy
    Mr Ambani is fined Rs 25 crores which is like peanuts for Reliance. Moreover, Mr Ambani is a good businessman. Investors believe in their strong governance and vision , so still bullish for long term.
    Like 0
  • Shiju Michael @Shiju Michael
    Mukesh Ambani is an individual and Reliance is a company ....now the fine he will have to pay from his pocket not from company account ... hope this makes some sense.
    Like 3
    • Kaustab Kind @Kaustab Kind
      @Shiju Michael Well, That Individual is the Promoter of the Company. Have you ever heard about reputation issue? If you're doing a business and have some scandal under your name, do you think any person with common sense will invest in your business
      Like 2
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