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I bought PFC 200 call at Rs 3.5 and PowerGrid Corp 100 call at Rs 1.25. Please suggest strategies. – M.A. Samuel, Trivandrum
PFC: The outlook remains negative. The stock finds crucial resistance at Rs 220 and the support at Rs 193.
A conclusive close below Rs 193 could weaken the stock sharply towards Rs 165 and even to Rs 138.
Only a close above Rs 250 would change the negative outlook on PFC.
F&O pointers: The futures closed at Rs 201 with respect to the spot close, and added heavy open interest positions, most of which are on the long side.
Option trading suggests negative bias as calls witnessed higher accumulation in open interest, suggesting the emergence of call writers.
Strategy: As your position is in profit zone, exit.
Powergrid: The stock has been in Rs 115-90 for almost two years and is likely to stay in the range. The immediate support appears at Rs 92 and the resistance at Rs 122. A close below Rs 92 could drag it to Rs 75 and a close above Rs 122 could lift it to Rs 149.
F&O pointers : The futures witnessed unwinding of open interest on Friday despite it gained over two per cent. Options are not active.
Strategy: Exit and re-enter once the stock takes a clear direction.
I am holding a Nifty futures short position, which I entered at 5395. Can I hedge my position by buying a call?– P. Gopal, Chennai
Nifty : The outlook remains negative. The index finds crucial resistance at 5645 and support at 5391. A conclusive close above 5645 has the potential to lift the index towards 5890. A close below 5391 could drag Nifty to 5206 and to 4890. Only a close above 6142-45 would change the outlook to positive.
F&O pointers: Despite gains on Friday, Nifty still ended in a discount against the futures, indicating the existence of short positions. Option trading indicates a neutral view as call and put added open interests marginally. However, the sharp fall in volatility index suggests a positive bias.
Strategy: If you can afford, hold your short position with a stop loss at 5645, which is far from your entry level. Hedging cannot be used for short-term positions.
NOTE: The analysis and opinion expressed in this column are based on F&O data available at this point of time and on technical analysis based on past price movements. There is risk of loss in trading.
Feedback may be sent to > f&o@thehindu.co.in
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