Derivative Strategy on Cholamandalam Invt & Fin Co by HDFC Securities

Buy CHOLA FINANCE DECEMBER Future at Rs 313

Stop Loss Rs 308

Target Rs 325

Lot Size 1000.

Rationale:

• We have seen Long build up in the Chola Finance Futures’ yesterday where we have seen rise in Open Interest with price rising by 3.3%.
   
• Stock price has broken out on the daily chart with higher volumes where it closes at highest level since 27-November.
   
• Stock price reversed northward by taking support at upward slopping trendline, adjoining lows of 24-July, 23-Aug and 16-October 2019.
   
• Stock price has formed multiple bottoms around 295 levels.
   
• Primary trend of the stock is bullish where stock price is trading above its 20, 50 and 200 day SMA.

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Disclaimer: The author is a Technical Analyst at HDFC securities. Views expressed are his own.