Here's a Bull Spread strategy on Sun Pharma by Nandish Shah of HDFC Sec

Bull spread Strategy on Sun Pharma 

Buy Sun Pharma Feb 650 Call at Rs 20 & simultaneously sell Feb 680 Call at Rs 10 

Lot Size: 1,400 

Cost of the strategy: Rs 10 (Rs 14,000 per strategy) 

Maximum profit: Rs 28,000 If Sun Pharma closes at or above 680 on 25 Feb expiry. 

Breakeven Point: Rs 660 

Rationale: 

-- Long build-up was seen in Sun Pharma Futures’ where we have seen 7 per cent rise in the 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 September 2018, with higher volumes 

-- Oscillators like RSI and MFI are showing strength in the stock 

-- Primary trend of the stock is positive where it is trading above its 100- and 200-day EMA.  

-- The stock price has witnessed running correction of 10 per cent from the recent high 

---

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