Bull spread Strategy on Dr Reddy s Labs Buy DR REDDY S MARCH 4,600 Call at Rs 182 & simultaneously sell 4,800 Call at Rs 106
Lot Size: 125
Cost of the strategy: Rs 76 (Rs 9,500 per strategy)
Maximum profit: Rs 15,500 If Dr Reddy s closes at or above 4,800 on March 25 expiry.
Breakeven point: Rs 4,676
Rationale: Long build-up was seen in the Dr Reddy Futures’ where we have seen 4 per cent (Prov) rise in the Open Interest with price rising by 1 per cent. The stock price has broken out on the daily chart where it closed above 200-day EMA with higher volumes. The stock price has formed double bottom around 4,380-odd levels
Buy IOC Feb 100 Call at Rs 2.30 & simultaneously sell Feb 105 Call at Rs 0.95 Lot Size 6500 Maximum profit Rs 23725 If IOC closes at or above 105 on 25 Feb expiry. Breakeven Point Rs 101.35
Rationale: Long build up was seen in the IOC Futures’ where we have seen 12 per cent (Prov) rise in the Open Interest with price rising by 4 per cent. The stock price has broken out on the daily chart (Adjusted for dividend) where it closed at highest level since March 2020 with higher volumes Plus DI has crossed the Minus DI, indicating strength in the current uptrend The primary trend of the stock is positive where it is trading above its all-important moving averages.