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SBI Cards and Payments Services (₹786.30) is ruling at a crucial level. The stock finds resistance at ₹830 and ₹1,010. Support levels are at ₹768 and ₹685.
We expect the stock to move with positive bias in the short term and will try to breach the key resistance levels.
F&O pointers: SBI Cards October futures closed at ₹793.75, a decent premium of about ₹7 over the spot close of ₹786.30. This signals rollover of long positions from September to October series. Option trading indicates that the stock could move in a wide range of ₹700-850.
Strategy: Traders can consider a bull-call spread on SBI Cards. This can be initiated by selling 800-call and simultaneously buying the 785-call. These options closed with a premium of ₹20.25 and ₹27.40 respectively.
This will entail an outflow of ₹7.15, which would be the maximum loss in this trade. The maximum loss will happen if SBI Cards closes at or below ₹785 on expiry.
On the other hand, a profit of ₹7.85 (₹6,280 as the market lot is 800 shares) is possible if SBI Cards hit ₹800. Hold the position till expiry week if the profit is not achieved earlier.
Follow-up: As expected, Titan Industries was volatile last week. After initial hiccups, the stock recovered on a strong note on Friday. However, the recommended position is slightly negative. We advise traders to consider holding it for one more week.
Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading
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