Bull Spread strategy on Britannia by Nandish Shah of HDFC Securities

Bull spread Strategy on Britannia

Buy Britannia Jan 3650 Call at Rs 54 and simultaneously sell Jan 3800 Call at Rs 15

Lot Size: 200

Cost of the strategy: Rs 39 (Rs 7,800 per strategy)

Maximum profit: Rs 22,200 if Britannia closes at or above 3,800 till 28 Jan expiry.

Breakeven Point: Rs 3,689

Rationale:

-- Long build-up was seen in the Britannia Futures’ where we have seen a 4% rise (Prov) in the Open Interest with the price rising by 1 per cent

-- Short-term trend of the stock has turned positive where the stock price is trading above all important short-term moving averages

-- Oscillators like RSI and MFI are showing strength in the stock

-- The stock price is taking support at 200-day EMA since many months

  

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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.