The long term outlook for the stock of Motherson Sumi Systems (₹237.15) remains bullish, though in the short term it is expected to move within a range. The stock finds an immediate support at ₹217 and the major one at ₹199. If the current trend continues, Motherson Sumi can be expected to touch new peak at ₹278. Nevertheless, in the short run, we expect the stock to move in a range between ₹199 and ₹269.
F&O pointers: The counter entered in derivatives recently. Open interests fluctuated even as the stock, after hitting at ₹269, cooled a bit. Currently, open interest stands at 3.27 crore shares. Option trading indicates a range of ₹220-250 for the stock.
On the other hand, loss will start to accumulate, if Motherson Sumi surges past ₹282.70 (break-even point of the strategy). Besides limited profit, this strategy is risky as it will require higher margin commitment, if the stock rises sharply.
Follow-up: Hold BHEL option strategy for one more week, despite the position currently being at a loss. Also, hold Infosys option recommended in the previous week, as the company is set to declare Q2 result on October 13.
Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading.