Option Strategy on JSW Steel by Motilal Oswal Securities

Strategy:

Option Strategy:

JSW STEEL : BULL CALL SPREAD

Buy 210 CE 1 lot

Sell 215 CE 1 lot

Reward: 15000                     

Risk: 5000

Rationale:

1. It has taken the support at 190 and managed to hold above 200 zone

2. Positive sector outlook with long rolls suggests extension of up move after a small consolidation

3. Fresh Put writing at 200 strike could provide the support

4. Call unwinding in 210 strike may give fresh momentum and fresh leg of rally towards 215-218 zone

5. Thus low risk strategy Bull Call Spread is recommended

Disclaimer: Chandan Taparia is a Derivatives and Technical Analyst at Motilal Oswal Securities.