Trading desk

Nifty, Bank Nifty & CNXIT

Nifty
Current Spot: 6281 (futures 6301),
Target: (Futures) 6400

The index has hit a new 2010 high. It has support at 6225-6250 and possible upside till a new all time high of 6400 in the next 5 sessions. Possible actions: a) Keep a stop at 6220 and go long in November futures. b) A bullspread with long Nov 6400c ( premium 62) and short 6500c (31) with a cost of 31 and a potential return of 69. Note that Diwali trading may be low-volume and weak, allowing entry at lower levels. In that case, stop loss at 6175 with the same 6400 target.

Bank Nifty
Current 13192 (futures 13209), Target NA

The financial index is at a new all time high and target setting is not possible. However, it should make net gains over the next 5 sessions. There will also be profit-booking. Possible actions: a) Set a stop at 13050 and go long in Nov futures. b) Take a bullspread with long 13200c ( premium 260) and a short 13500c (145) for a cost of 115, potential gains of 185. Breakeven is at 13315. The bullspread is preferable.

CNXIT
Current 6818.25 (Futures 6829), Target 7000

The IT index is testing previous highs and should move till the band of 6950-7050. There’s a lot of switching inside the sector so index-futures position are better than specific IT stocks. The November futures has enough volume for a long position with a stop loss at 6735. Increase the position between 6865-6900. Book profits above 7000.

(The target price and projected movements given above are in terms of the next one trading session, unless otherwise stated)