I hold F&O long positions on Divi’s Lab (one lot), Tata Steel (two lots) and Tata Motors (three lots). Need your views and targets for the same
Divi’s Laboratories (₹3,315): The May futures of Divi’s Lab, at ₹3,304.40, is at a discount to the underlying. While this by itself is not a bearish signal, considering that the stock is now hovering near a strong resistance at ₹3,400, holding futures long at this level carries higher risk. Moreover, the overall trend remains bearish. It will turn bullish only if the barrier at ₹3,400 is invalidated. Hence, we suggest exiting your long trade at the current level. You can consider buying futures again if the stock decisively breaches the hurdle at ₹3,400.
Tata Steel (₹106.75): The stock of Tata Steel has been on a decline since the final week of January. Although there was an attempt to rally in the past few sessions, it failed to break out of a barrier at ₹112. Until this resistance holds true, the bias will remain bearish. Therefore, our suggestion would be to exit Tata Steel futures (₹107) at the current level. Buy the contract if it decisively breaks out of the resistance at ₹112.
Tata Motors (₹516): The stock of Tata Motors confirmed a triangle pattern a month ago, a bullish signal. According to the pattern, the stock could rally to ₹600. So, you can hold Tata Motors futures (₹517). But place stop-loss at ₹490. When the contract surpasses ₹530, modify the stop-loss to ₹515. When the price hits ₹560, liquidate two lots of futures long and then tighten the stop-loss to ₹545. Exit the remaining one lot at ₹590.
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