Bull Spread strategy on JSW Steel by Nandish Shah of HDFC Securities
The stock price of JSW Steel has broken out on the daily line chart with higher volumes to close at all-time high levels
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Bull spread Strategy on JSW STEEL
Buy JSW STEEL 780 CALL at Rs 23.3 & simultaneously sell 810 CALL at Rs 13.30
Lot Size: 1350
Cost of the strategy: Rs 10 (Rs 13,500 per strategy)
Maximum profit: Rs 27,000 if JSW STEEL closes at or above Rs 810 on 26 August expiry
Breakeven Point: Rs 790
Rationale:
- We have seen a long build up in the JSW steel Futures, where we have seen 2%(Prov) rise in the Open Interest, with the price rising by 2.50%.
- The stock price has broken out on the daily line chart with higher volumes to close at all-time high levels.
- Plus DI is trading above -DI and ADX line is placed above 25, indicating momentum in the current uptrend.
- RSI and MFI Oscillators are placed above 60 and slopping upwards, indicating strength in the current uptrend.
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Buy JSW STEEL 780 CALL at Rs 23.3 & simultaneously sell 810 CALL at Rs 13.30
Lot Size: 1350
Cost of the strategy: Rs 10 (Rs 13,500 per strategy)
Maximum profit: Rs 27,000 if JSW STEEL closes at or above Rs 810 on 26 August expiry
Breakeven Point: Rs 790
Rationale:
- We have seen a long build up in the JSW steel Futures, where we have seen 2%(Prov) rise in the Open Interest, with the price rising by 2.50%.
- The stock price has broken out on the daily line chart with higher volumes to close at all-time high levels.
- Plus DI is trading above -DI and ADX line is placed above 25, indicating momentum in the current uptrend.
- RSI and MFI Oscillators are placed above 60 and slopping upwards, indicating strength in the current uptrend.
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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.
Topics : JSW steel F&O Strategies Market technicals Markets