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Derivative strategy by Nandish Shah of HDFC Securities for Larsen & Toubro

The stock price has broken down on the daily chart to close at the lowest level since May 2016 with higher volumes.

Nandish Shah  |  Mumbai 

Primary trend of the stock turned negative where it is trading below its 5,20 and 200 day SMA
Primary trend of the stock turned negative where it is trading below its 5,20 and 200 day SMA

Buy L&T March 820 Put at Rs 50

Stop Loss: Rs 30

Target: Rs 85

Lot Size: 375.
.

Rationale:
  • Short build up is seen in the Larsen Futures’ where we have seen rise in the Open Interest yesterday with price falling by 6.7 per cent.
  • Stock Price has broken down on the daily chart to close at the lowest level since May 2016 with higher volumes.
  • Primary trend of the stock turned negative where it is trading below its 5,20 and 200 day SMA.
  • Oscillators and Momentum Indicators like RSI and MACD showing weakness in the stocks.

First Published: Fri, March 20 2020. 07:53 IST
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