Bank Nifty: Nandish Shah of HDFC Sec recommends Bull Spread Strategy
Stock Market Today: Short-term trend in Bank Nifty has turned positive as the index is placed above its 5-day EMA
 "Bank Nifty: Nandish Shah of HDFC Sec recommends Bull Spread Strategy")
Bank Nifty share price today, March 7:
BULL SPREAD Strategy on BANK NIFTY
Buy BANKNIFTY (27-March Expiry) 49000 CALL at Rs 590 & simultaneously sell 49500 CALL at Rs 380
Lot Size: 30
Cost of the strategy: Rs 210 (Rs 6,300 per strategy)
Maximum profit: Rs 8,700 if BANK NIFTY closes at or above 49,500 on 27 March expiry.
Breakeven Point: Rs 49,210
Risk Reward Ratio: 1: 1.38
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Approx margin required: Rs 30,000
Rationale:
>> Long build up has been seen in the Bank Nifty futures during the week till now, where we have seen 7 per cent (Prov) rise in the open interest, with the index closing 0.60 per cent higher on Thursday, March 6, 2025.
>> Short-term trend in Bank Nifty has turned positive as the index is placed above its 5-day EMA. >> Bank Nifty has formed a strong base by forming multiple bottoms around 47,800 levels.
>> Bank Nifty open interest put call ratio rose to 1.02 levels from 0.91 levels on the back of Put writing at 48,000-48,500 levels, suggesting limited downside from hereon. ALSO READ: Nifty Today: Sahaj Agarwal of Kotak Sec suggests 'Short Strangle' on index
Note : It is advisable to book profit in the strategy when ROI exceeds 20%. ==================== Disclaimer: This article is by Nandish Shah, senior technical/derivative analyst at HDFC Securities. Views expressed are his own.