The following are Derivative calls for May Series or different time frame as indicated against each strategy given by KARVY STOCK BROKING HOUSES:
The Nifty is expected to remain in a range of 5,700-5,900 levels, and a sustained move around 5,700 will guide the Index towards higher resistances. However, in our view, in the current scenario, the Index is expected to see stiff resistance around 5,850-5,900 levels, while a breach below 5,700 should guide the Nifty towards 5,600 levels.
The Nifty is expected to remain in a range of 5,700-5,900 levels, and a sustained move around 5,700 will guide the Index towards higher resistances. However, in our view, in the current scenario, the Index is expected to see stiff resistance around 5,850-5,900 levels, while a breach below 5,700 should guide the Nifty towards 5,600 levels.
NIFTY:
Buy Nifty May futures @ 5,720-5,730* stop loss: 5,680* target: 5,800, 5,850*
Sell Nifty May futures below 5680* stop loss: 5,720* target: 5,600* (*spot levels)
NIFTY STRATEGY:
Sell one lot of Nifty May 5700 PE @ 90-95 and sell one lot of Nifty May 5900 CE @ 50-55; UBEP: 6040; LBEP: 5560; Max profi t: Rs.7000; TF: 10-12 days
NIFTY OPTIONS:
Symbol Recomm Entry Stop Loss Target Time Frame
May5900C Short 50-55 5880 (Spot) 25-26 1 Week
May5700P Short 95-100 5690 (Spot) 75-76 1 Week
::DIFFERENT STRATEGIES::
::DIFFERENT STRATEGIES::
HYBRID STRATEGIES:
Short Strangle in ICICI Bank:
ICICI Bank traded in a narrow range of 1,080-1,140 over the last one month. ICICI Bank posted Q4 results in-line with market expectations. The stock saw a 97% rollover, mainly on the long side. On the options front, the counter saw writing across the board, with maximum open interest in the 1,100-strike put and 1,150-strike call. The stock is likely to continue its range-bound movement in the coming weeks. Therefore, we advise a short strangle strategy in the stock.
Sell one May 1180 call @ 12-14 and sell one May 1080 put @ 20-22; UBEP: 1212; LBEP: 1048; max profi t: Rs8,000 if the stock expires at 1,180-1,080 levels.
Short Strangle in IFCI:
IFCI has been trading in a broad range of 50-57 levels in the last few trading sessions and saw a sell-off from the upper band. Technically, IFCI formed a rounding-top formation on the charts and is currently trading below all its moving averages. On the options front, the stock saw writing across the board with maximum open interest in the 50-strike put and 55-strike call, indicating the counter is likely to remain range-bound. In such a scenario, we suggest a short strangle strategy in the stock.
Sell one May 55 call @ 1-1.25 and sell one May 50 put @ 1.0-1.25; UBEP: 57; LBEP: 48; max profi t: Rs8,000 if the stock expires at 55-50 levels.
Ratio-Spread in Tata Steel:
Tata Steel saw strong rollover of 91%, above it three-month average. The basis movement indicates that most rolls were on the long side. The stock has immediate support at 605 levels and resistance at 640 levels. On the options front, both OTM call and put options saw writing last week, indicating range-bound movement with upward bias in near term. The maximum open interest is at the 640 and 620 call-option strikes and 620 and 600 put-option strikes. We recommend a call-ratio spread in the stock
Buy one Tata Steel May 620 CE @ 15-16 and sell two May 640 CE@ 9.5-10 BEP: 663; max profi t: Rs11,500 at 640; max loss: unlimited if the stock stays above 663 levels.NOTE: ALL ARE REQUESTED TO TRADE ON THEIR OWN DECISION/RISK AND WITH STRICT STOPLOSS.
