BEAR SPREAD Strategy on INDUSIND BANK
Buy INDUSIND BANK (August 31-Expiry) 1370 PUT at Rs 33.4 & simultaneously sell 1320 PUT at Rs 14.25
Lot Size: 500
Cost of the strategy: Rs 19.15 (Rs 9,575 per strategy)
Maximum profit Rs 15,425 If Indusind bank closes at or below Rs 1320 on 31 Aug expiry.
Breakeven Point: Rs 1,350
Approx margin required: Rs 24,000
Rationale:
>> We have seen short build up in Indusind bank Future on Thursday, where we have seen 2 per cent addition in Open Interest (Prov) with price falling by 1.21 per cent.
>> Stock price has broken down on the daily chart to close at the lowest level since July 7, 2023
>> Short term trend of the stock is weak as stock price is trading below its 5,11 and 20 day EMA.
>> Oscillators like RSI (11) and MFI (10) are in falling mode and placed below 50 on the daily chart, suggesting strength in the current downtrend.
Disclaimer: Nandish Shah is Sr. Derivatives & Technical Research Analyst at HDFC Securities. He doesn’t hold any position in the stock. Views are personal.
First Published: Aug 04 2023 | 7:11 AM IST