Nifty weekly derivates strategy

Markets have been in the uptrend for the whole week, with strong closing coming in for the latest session.

Nifty coming week expiry option chain witnessed PE writers actively adding their positions at various strikes till 17400/17500 strikes - maximum fresh contracts of over 45 thousand each and CE writers standing tall at 18000 CE levels, with the highest fresh additions of over 30 thousand contracts. PCR OI at 17500 being just below 1 is crucial to watch to understand the direction going ahead.

Option Strategy recommendation: Conditional Bullish move expected, recommend BULL SPREAD CALL

Weekly expiry BUY 17500CE at 160 and SELL 17800CE at 40. Max Risk 120 and Max Gains 180.

Bank Nifty weekly expiry option chain reflects on PE writers building positions at 39000 strike - overall more than 65 thousand contracts, with CE writers adding up equal and fair exposures at 41000-42000 strikes - over 60 thousand contracts each as well, which reflects on the broad range in between 39000-42000 zones for the index.

Since the immediate range is far spread, participating in SHORT STRANGLE is well suggested.

Weekly expiry: SELL 39000PE at 75/- and SELL 41000CE at 120/-

Total inflow of 195. (SL at 260 to be maintained or as per risk capacity also recommended for traders).

Please note selling options is a high-risk play, so only traders who can understand the risk should participate.

SECTOR UPDATES:
On weekly basis, most of the sectors saw strong up move participation, with METALS only witnessing some profit booking.

STOCKS UPDATES:
BUY HDFCAMC: CMP 2023, buy on declines till 2000, TGT 2083/2140, SL 2280.

BUY COLPAL: CMP 1605, buy on declines till 1590, TGT 1640/1665, SL 1575

SELL MARUTI: CMP 8725, TGT 8500/8370, SL 8850.

(Shilpa Rout is Derivatives Lead Analyst, Prabhudas Lilladher Pvt Ltd)