Amit Gupta of ICICI Direct advised going long in Hindalco 110 Call Option with a target of Rs 6. He also advised keeping a stoploss at Rs 1.5.
Gupta told CNBC-TV18, “From Rs 130-115 there was very heavy short addition in Hindalco, almost more than 50 percent. But when it was falling from Rs 115-110 we saw that there was no more addition rather there was just closure of positions. That means traders possibly were thinking that the downsides maybe limited in the stock. The stock on numerous occasions has reverted from Rs 110 in the last one year or so.”
“I believe that because of this closure it is possible that the stock may again go back to Rs 115 or Rs 116. If you look at the Rs 110 Call Option it has seen some closure of positions in the last session. It is possible that this closure may again continue for another couple of sessions or so. So you go long in Rs 110 Call Option, look for a target of Rs 6 which is currently at Rs 3, keep your stop loss at Rs 1.5. I think before expiry this maybe a good trade to play on the short covering part,” Gupta added.