F&O Call: Nandish Shah recommends this F&O trading strategy in Vedanta

The derivative analyst from HDFC Securities recommends buying Vedanta 310 Call and simultaneously selling 330 Call of the November series.

Bull Spread Strategy on Vedanta

Buy Vedanta (24-Nov Expiry) 310 Call at Rs 8.5 & simultaneously sell 330 Call at Rs 3

Lot Size 1,550

Cost of the strategy Rs 5.5 (Rs 8,525 per strategy)

Maximum profit Rs 22,475; if Vedanta closes at or above 330 on expiry.

Breakeven Point Rs 315.5

Approx margin required Rs 25,000

Rationale:

We have seen long build up in the Vedanta futures on Thursday, where we have seen 17 per cent addition (Prov) in Open Interest with price rising by 2 per cent.

The stock price has broken out on the daily chart where it closed at highest level since 15-Sept 2022.

Primary trend of the Stock turned positive as stock price closed above its 200-day EMA.

Momentum Oscillators like RSI (11) and MFI(10) are in rising mode and placed above 60 on the daily chart, indicating strength in the current uptrend.

Disclaimer: Nandish Shah is Sr. Derivatives & Technical Research Analyst at HDFC Securities. He doesn't hold any position in the stock. Views are personal.