F&O Strategy: Mphasis Stock Enters Neutral Zone with Recovery; Consider 1920-Strike Call Option

Mphasis stock (€1,895.05), which had a negative outlook in the short term, entered the neutral zone, thanks to a sharp recovery. The stock is now finding immediate support at $1,784 and INR1,700.

Long-term bullish outlook will remain intact until stock rules above INR 1530. The stock finds immediate resistance at $1,984. A close above $2060 will reaffirm the long term bullish pattern. We expect the stock to move sideways with a positive bias in the short term.

F&O Indexes: Futures saw a strong move of about 97% to the July series. Mphasis July futures, at INR 1,908.55, is up from the spot price of INR 1,895.05. Options trading indicates that the stock can move between 1,800 and 2,000 Indian Rupees.

strategy: Consider buying the 1920 strike call option. It closed at a premium of INR 63.90. Since the market share is 275 shares, this strategy will cost 17,572.50 rubles. This will be the maximum loss on this trade that will occur if Mphasis fails to cross $1.920 on expiry.

On the other hand, the profit potential is high, if the stock moves sharply in this series. A close above $1,983.90 will start turning the position into a profit. Hold the position with a stop loss of $40, which can be converted to $60 if the stock opens and remains positive in the first hour of trading on Monday. The stop loss can then closely track the immediate movement to protect profits. Book earnings between $110 and ₹115.

tracking: Traders may consider holding the NTPC call option for an additional two weeks, as the stock moved according to the expected lines.

Note: Recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading