Godrej Properties stock derivatives data suggests a build-up of long position with positive rollovers in the May series. Open interest gained nearly 5 percent, despite the stock ending the previous session on a sluggish note.
The put-call-ratio (PCR) stands at 0.64, with a premium of 26 points. The change in OI is 1.98 lakh on yesterday's closing basis, with trading volume at approximately at 18 lakh.
To capture this bullish set up, Avdhut Bagkar, Derivatives & Technical Analyst at StoxBox, recommends taking a long position in Godrej Properties stock by buying call option.
Position: Buying 2640 CE
Entry price range: Rs 110 – 115,
Stop loss: Rs 85
Target: Rs 150 and 170.
Technical View
"Technically, the stock has a major support of EMA 21, which is currently placed at 2,520 level. The broader outlook is bullish, as the price is displaying robust reversal nearing the key moving average. A sustained move over Rs 2,650 would prompt addition of long positions in the stock. The strength indicator, Relative Strength Index, is yet to enter the overbought territory, leaving more possibility for an up move," said Bagkar.
Derivative data
Bagkar said that the highest open interest can be seen in 2,700 CE and 2,500 PE, descripting a broad trading range. Also, 2,660 CE and 2,680 CE have seen long positions addition, implying a favourable sentiment.
Strong concentrations can be seen in 2,600 CE and 2,700 CE. The price action is headed towards 2,700 and 2,750 levels, options analysis showed.
"Hence, we reckon a long position in Godrej Property, advising buying 2,640 CE in the range of Rs 110–115, holding Rs 85 as stop loss, and aiming to hit Rs 150 and Rs 170," he added.
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