F&O Radar: Deploy Bull Call Spread in Nifty to play potential up-move
lifetime high of 24,236 but formed a small-bodied bearish candle on the daily scale.
“Now, it has to hold above 24,000 zones to extend the move towards 24,250 and 24,400 zones, whereas supports are placed at 23,900 then 23,750 zones,” said Chandan Taparia Senior VP, Equity Derivatives & Technicals, Broking & Distribution at Motilal Oswal.
On the options front, the maximum Call OI is at 24,500 and then at 24,200 strikes, while the maximum put OI is at 24,000 and then at 24,100 strikes. Call writing is seen at the level of 24,200 followed by a 24,100 strike while put writing is seen at 23,800 then a 24,100 strike.
Option data suggests a broader trading range in between 23,800 to 24,500 zones, while an immediate range between 24,100 to 24,300 levels.
India VIX has also been hovering near 14 zones from the last 12 trading sessions and comparatively lower volatility is comforting the bulls.
Talking about Nifty, Taparia said that overall, he has a positive to range-bound stance and expects that small declines could be bought for an upside move towards 24,250-24,300 zones.
Given such a scenario, Chandan Taparia suggests deploying a Bull Call Spread in Nifty to play the upside move.
Bull Call Spread
A bull call spread is an options trading strategy that uses two call options. It is deployed usually when a trader anticipates a moderate rise in the price of the underlying asset.
(Prices as of July 2)
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not
