Buy Nifty 8250 Put and sell 8500 Call, says Manoj Murlidharan

Talking about the Futures and Options strategies for June expiry and the July series,  Manoj Murlidharan, Head-Derivatives, Religare Securities said one can buy Nifty 8250 put at Rs 10 for a target of Rs 50, with no stoploss at zero. Buy Nifty Bank 17800 Put at Rs 30, for a target of Rs 100 and again no stoploss, says Murlidharan.

Sell July 8500 call at Rs 60 for target of Rs 30, with a stoploss at Rs 80, said Murlidharan in an interview to CNBC-TV18.

Stock specific, he recommends buying Adani Power at Rs 30.40 with a stoploss at Rs 29.60, for a target of Rs 33 and buying Torrent Pharma at Rs 1,350 with a stoploss at Rs 1320, for a target of Rs 1,430.Below is the verbatim transcript of Manoj Murlidharan's interview with Anuj Singhal on CNBC-TV18.Q: Expiry day, any strategy that you have on the index either the Nifty or the Bank Nifty?A: We have strategies for both of them. The only thing that I would like to say is when we started this contract of June, we had an open interest (OI) of somewhere close to 1.94 in the Nifty and now the July contract is around 1.14. So we have close to 70 lakhs if we have to match the rollovers, which is around 74 percent which happened last month.Same goes with the Bank Nifty, it is around 5 lakhs in terms of open interest. 8,300 is a strike where there is highest built up, which is happening into the call side. Ideally, there is a concept of volume weightage average prices (VWAP) which generally works on the day of expiry. Now what we have found is foreign institutional investors (FIIs), if you see last four days they are selling in the cash market and there is some stock future selling as well. So net-net, there is a reversal arbitrage or there is some money, which is being pulled up. It is only yesterday there was some bout of buying in the cash market and the stock future was a buy of Rs 366 crore. That is exactly we have seen the breadth in the market was very positive.There are close to 38 stocks in the Nifty where we feel there is a good amount of long position which might not get rolled into today's trade. So we are expecting some profit booking at 8,280 levels from the Nifty and we are expecting that it might be a gradual grinding on the downside. We are expecting 8,210. So the strategy here is buy an 8,250 Put option for the current month, yesterday's close is around Rs 38-40 but you will get it around Rs 10 when you buy that. No stop loss on that and the target is Rs 50. The same strike you can do is 8,500 July Call option can be sold at Rs 60, stop loss of Rs 80 and a target of Rs 30. Same goes with the Bank Nifty, you buy 17,800 Put option between Rs 20-25, no stop loss and we are expecting a target of Rs 100 on that.Q: Give us a word on market opening and stocks to trade.A: This is expiry day, so a lot of things depend on what the entire June contract has given the traders and if they wish to carry it positive on the upside. As you are talking of the USD-INR pair for them the breakeven would be somewhere close to 67.35 per dollar. So I believe yes, 8,280 odd might be the top and for the Bank Nifty it might be closer to 17,880 to 17,920.I am expecting some intraday grinding to come in. The last 30 minutes of the trade that is your VWAP starts from 3, might be a short covering especially from the banks. So that might culminate and the expiry might be closer to 8,230, the intraday low can be 8,200-8,210.Stock specific we like Adani Power and this is on the basis of VWAP. We have seen the net open interest which is yet to be rolled with a cash delivery that has happened. So Adani Power at 30.45 with a stop loss of Rs 29,20, we recommend buying that. Target should be somewhere close to Rs 33.The CNX pharma index has bottomed out and we feel the index can go all the way to 11,860. So obviously there are two stocks like Lupin and Cipla, which absolutely can give you good returns in the long run, which might be a quarter's time but as of now because it is expiry, we like Torrent Pharma, strategy here is to buy it with a stop loss of Rs 1,320 and we are expecting a target of Rs 1,430 on that.