F&O Strategy: Nandish Shah recommends this strategy for the May expiry

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BEAR SPREAD Strategy on KOTAK MAHINDRA BANK

Buy KOTAK BANK (26-May Expiry) 1,780 PUT at Rs 29 & simultaneously sell 1,760 PUT at Rs 20



Lot Size 400

Cost of the strategy Rs 9 (Rs 3,600 per strategy)

Maximum profit Rs 4400 If closes at or below 1760 on 26 May expiry.

Breakeven Point Rs 1771


Rationale:

  • We have seen short buildup in the Kotak Bank futures where we have seen 7 per cent addition (Prov) with Kotak Bank falling by 3.5 per cent.
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  • Short term trend of the Kotak Bank turned negative as it has closed below its 5 and 20 day EMA.

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    Future has broken down from the upward sloping trendline, adjoining the lows of 25-April and 12-May 2022.
  • Stock price has been taking resistance around the 200-day EMA.
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Disclaimer: Nandish Shah is Technical Research Analyst at HDFC Securities. He doesn’t hold any position in the stock. Views are personal.


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First Published: Fri, May 20 2022. 07:48 IST





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