Sahaj Agrawal of Kotak Securities recommends Short Strangle on Nifty

The analyst recommends to Sell Nifty January 23,900 Call, and 22,400 Put for the monthly derivative expiry.

Derivative Strategy  Nifty: Short Strangle (30JAN2025 Series)  Strategy Details:  - Sell 23900 CE and Sell 22400 PE  - Inflow: Rs 28  - Stop-Loss: Rs 56  - Target: Entire Premium (Maximum Profit: Rs 28)  - Lot Size: 25  - Breakeven Points: Lower Breakeven: 22372; Upper Breakeven: 23928  - Maximum Profit Zone: Between 22400 and 23900 by expiry  Rationale:  - Over the past week, the market has broadly entered a consolidation phase, likely due to short-term oversold conditions.  - For the week ahead, 22,800 is expected to act as a support while 23,500, a previous support level, now serves as a resistance on a role-reversal basis. Range-bound activity anticipated between these key support & resistance levels.  - Significant open interest observed at 23,500/24,000 Call and 23,000/22,500 Put levels, indicating key trading zones.  - The Put-Call Ratio (PCR) for the 30th January 2025 series stands at 0.90, reflecting neutral sentiment.    ===================  Disclaimer: Sahaj Agrawal, Senior Vice President, Head of Derivatives Research, Kotak Securities