Nifty50: Sahaj Agrawal of Kotak Sec suggests Bull Call ahead of RBI outcome

Nifty Today: The 23,800 level aligns with key trendline resistance, temporarily halting the uptrend

Stock Markets News: Nifty Today 

 

Strategy Details:

Strategy: Nifty Bull Call Spread

Expiry: 13 FEB 2025

Strikes: Buy 23,600 CE and Sell 24,000 CE

Net Outflow: 155 points

Stop Loss: Entire premium outflow (Max Loss = 155 points)

Strategy Target: 400 (Max Profit = 245 points)

Break-even Point (BEP): 23,755

 

Rationale:

 

>> The sharp Nifty rally over the past few days has led to overbought conditions, triggering a corrective retracement as traders book profits or reduce weaker long positions. 

 

>> The 23,800 level aligns with key trendline resistance, temporarily halting the uptrend.

 

>> However, the correction is expected to find support near the 23,500–23,450 zone, providing a potential entry point for bullish positions.

 

>> Improved market breadth suggests the resistance at 23,800 is temporary, with a breakout likely to drive Nifty towards 24,500.

 

>> A Bull Call Spread is recommended to capitalise on the bullish bias with controlled risk.

       

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Disclaimer: Sahaj Agrawal is Senior Vice President, Head of Derivatives Research at Kotak Securities. Views expressed are his own.