RELINFRA

In addition to recommendations yesterday, one can think of RELINFRA option contract.

Stock in general in uptrend but now touching support line.

See chart below.

There are only two possibilities. Either it will bounce back to 840 level or will break lower support of channel!!

What it will do next week? Nobody knows, but as a safe strategy one can sell 860 CALL between 4-5.

Stock is trading near 735. It will be difficult for stock to again cross all time high and break upper channel resistance.

Sell RELINFRA 860 CALL between 4-5, your account will be credited by 2000-2500 with an investment of about Rs. 50,000 as margin money.

There is 85% chance that with present volatility stock will not cross 860 before expiry this month.

See MACD cross over.

Open interest very low in 860 CALL compared to 850 CALL.

According to OI, stock may fluctuate between 700-850.

So overall, this seems to be very safe strategy, risk reward ratio is very good, earning will be more than 4 times of bank FDs. This trade befits in to our blogs general objective of  finding low risk strategies.

We will update about all these strategies throughout the week.

Disclaimer: This blog does not take any responsibility of your profit and loss.