The stock of UltraTech Cement (₹7,628.8) is ruling at a crucial level. The stock finds an immediate resistance at ₹7,742. A close above this will change the long-term outlook positive. The stock finds next resistance at ₹7,940. A close above this will trigger a fresh rally in UltraTech that could help it touch a new peak around ₹9,000.

On the other hand, UltraTech Cement finds an immediate support at ₹7,456 and a close below ₹7,358 will change the short-term outlook to negative. Notably, a close below ₹7,358 has the potential to drag the price lower to ₹6,577. Overall, we expect the stock to move in a narrow range with upward bias.

F&O pointers: UltraTech May futures closed at ₹7,672.7 against the spot price of ₹7,628.8. This indicates that traders prefer to carry over their long positions. Option trading indicates that the stock is likely to move between ₹7,300 and ₹8,000.

Strategy: Traders could consider buying 7,650-call that closed with a premium of ₹133.05. As the market lot is 100 shares, this would cost traders ₹13,305, which will be the maximum loss in this trade. This will happen if the stock fails to cross ₹7,650 by the end of this expiry.

We advise traders to enter the contract anywhere between ₹120 and ₹140. Aim for a target of ₹190-210. Initial stop-loss can be placed at ₹105 and be shifted based on an individual’s risk-taking ability.

Follow-up: Hold long strangle strategy recommended on Voltas last week.

Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading