Comments
The stock of Indian Railway Catering and Tourism Corporation (IRCTC) (₹889.2) finds an immediate resistance at ₹925. A conclusive close above this will lift the stock towards ₹1,018.
On the other hand, the stock finds an immediate support at ₹857 and ₹725. We expect the stock to move in the broader range with a positive bias in the short-term.
F&O pointers: IRCTC October futures on Friday closed at ₹893 while the underlying equity closed at ₹889.20. The contract shed open positions in the last 5 days even as the price moved up from ₹845 to ₹895. This signals potential unwinding of positions due to profit booking.
However, the premium over spot price indicates the existence of long positions. Option trading indicates that the stock could move in the ₹800-1,000 range.
Strategy: Consider buying the 900-strike call, which closed at a premium of ₹14.65. As the market lot is 875 shares, this would cost traders ₹12,818.75, which would be the maximum loss. This will happen if IRCTC fails to move past ₹900 before expiry. The position will turn positive on a close above ₹914.65.
We advise traders to keep the stop-loss at ₹4 and aim for a target of ₹25. The stop-loss can be adjusted suitably to cut losses and protect profits according to individual risk bearing ability
Follow-up: Stop-loss would have triggered in the Federal Bank recommendation. Those who are holding the option can exit.
Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.