Analyst suggests 'Bull Spread' strategy on Nifty Bank; check analysis here

Derivative strategy: Nandish Shah said that long build-up is seen in the Bank Nifty Futures, where Open interest rose by 8 per cent along with a price rise of 0.6 per cent

Derivative strategy by Nandish Shah of HDFC Securities

BULL SPREAD Strategy on BANK NIFTY

Buy BANKNIFTY (24-Feb Expiry) 60500 CALL at ₹726, simultaneously sell 61000 CALL at ₹511

• Lot Size 30
• Cost of the strategy ₹215 (₹6,450 per strategy)
• Maximum profit ₹8,550 If BANK NIFTY closes at or above 61000 on 24 Feb 2026 expiry.
• Breakeven point 60715
• Risk reward ratio: 1: 1.33
• Approx margin required: ₹36000

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Rationale:

• Long build-up is seen in the Bank Nifty Futures, where Open interest rose by 8 per cent along with a price rise of 0.6 per cent.
• Bank Nifty has broken out on the daily chart to close at its highest level since January 16.
• Bank Nifty is forming a bullish higher top, higher bottom formation on the weekly and monthly charts.
• Bank Nifty Open Interest Put call ratio increased to 1.24 levels from 1.14 levels on the back of Put writing at 59000-60000 levels.

 

(This article is by Nandish Shah, senior technical/derivative analyst at HDFC Securities. Views expressed are his own.)