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Bull Spread Strategy for ICICI Bank by Nandish Shah of HDFC Securities

The stock price has given breakout on the daily chart by trading above the downward sloping trendline resistance.

Nandish Shah  |  Mumbai 

Photo: Bloomberg
Photo: Bloomberg

Bull Spread strategy on ICICI BANK

Buy February 550 Call at Rs 7.90 & simultaneously sell 570 call at Rs 2.90

Lot Size: 1375

Cost of the strategy Rs 5 (Rs 6875 per strategy)

Maximum profit Rs 20625 If closes at or above 570 on February expiry.

Break even Point Rs 555

Rationale:

  • Long build up is seen in the Futures’ during this week where we have seen rise in the Open Interest with price moving up by 7%.
  • The stock price has given breakout on the daily chart by trading above the downward sloping trendline resistance.
  • Primary trend of the stock is positive where stock price is trading above its all important moving averages.
  • Oscillators and Momentum Indicators like RSI and MACD have turned bullish on the daily charts.
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Disclaimer: Nandish Shah is a Technical Analyst at HDFC securities.

First Published: Fri, February 07 2020. 08:01 IST
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