Friday, February 22, 2013

Trading Plan for 22-Feb-2013

NHPC: CMP = 28.65, looks weak at 29 levels and may give good opportunity to short if it trades weaker around 28.75 level, keeping a stop loss of 29.35 one can short it for a near term target of 28 and 26.50

TCS: CMP = 1450, seems to be struggling to break its 1450-1455 resistance zone. Option data also suggests fresh positions building up in the 1400 PE of Feb & Mar series. Also we see the same kind of activity on the 1450 CE in Feb series. This suggests that CALL traders are writing the 1450 CALL in anticipation of TCS correcting upto 1400 in near term.
Charts suggests that if TCS pulls back from 1450 then it will most likely reach 1350.

Recommendation :
Sell only if TCS trades below yesterdays candle low (i.e. 1440), best shorting opportunity is at 1455-1458 keeping a stop loss of 1462 for a target if 1440-1400

Sell TCS Feb 1450 CE @ 18.00 (lot size = 250)
Option Margin required to short = 72500
Max profit = 18 X 250 = 4500

However if TCS climbs 1462 then it is likely to go upto 1500.

Happy Trading! 


Lawrence Sequeira

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