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We spoke to two analysts on how one should trade stocks that were in focus in the previous trading sessions based on derivative and technical data:
Analyst: Sudeep Shah, Deputy Vice President and Head of Technical & Derivatives Research, SBI Securities
Ascending Triangle Breakout Sparks Optimism for Tata Motors
As the stock is trading at an all-time high, all the moving averages and momentum indicators suggest strong bullish momentum in the stock. The daily and weekly RSI is in the super bullish zone as per RSI range shift rules.
The derivative data signals significant long build-up, with a nearly 3% surge observed in the February series future. Meanwhile, there is a notable 6.07% surge in the cumulative Open Interest (OI) across the current, next, and far series.
There is a notable concentration of call open interest at the 970 strike. While significant open interest on the put side is observed at the 950 strike. Talking about option chain, from 970 to 990 CE strikes have witnessed call buying. While, on the put side, from 980 to 940 strike have witnessed put writing. This indicates bullish momentum in the stock. Hence, we recommend accumulating the stock in the zone of Rs 965-955 with the stop loss of Rs 930 level. On the upside, it is likely to test the level of Rs 1010, followed by Rs 1030 in the short-term.
![](https://img.etimg.com/photo/msid-42031747/et-logo.jpg)
F&O data suggest long build-up in Havells India
The derivative data is also supporting the overall bullish chart structure. The February future has surged by nearly 3% and cumulative open interest of current, next and far series is surged by nearly 7%. This indicates overall long build-up. Examining the option chain, it’s notable that there is a concentration of call open interest at the 1500 strike, while considerable open interest on the put side is observed at the 1400 strike. Talking about option chain, from 1470 to 1400 CE strikes are either witnessing call buying or call short covering. While, on the put side, from 1500 to 1420 strike have witnessed put writing. This indicates bullish momentum in the stock.
These technical and derivative factors are aligning in favour of bulls. Hence, we recommend accumulating the stock in the zone of Rs 1470-1460 with a stop loss of 1420. On the upside, it is likely to test the level of Rs 1540, followed by 1570 in the short-term.
![](https://img.etimg.com/photo/msid-42031747/et-logo.jpg)
Analyst: Sheersham Gupta, Director and Senior Technical Analyst at Rupeezy
Hindustan Petroleum – Falling Trendline Breakout
Hindpetro has been in a superb trend for the past four months and the stock has given about 160% since then.
The stock witnessed correction after making a high of 596. However, the stock found support at its 20-EMA and now has broken the falling trendline on the 30-minute charts. From here, we can expect a move to it’s all-time high level.
On the derivative front, the max pain for the stock stands at 520 indicating a limited downside move from here.
Thus, Hindpetro can be bought for a target price of 595 keeping the stop loss at 518 on a closing basis.
![](https://img.etimg.com/photo/msid-42031747/et-logo.jpg)
Larsen and Toubro (LT) – Three White Soldiers Pattern
LT after making a high of 3740 last month, corrected over 13%. However, the stock is showing signs of reversal forming three white soldiers candlestick pattern on the daily charts. On Monday, the stock managed to close above its 50-DMA.
There is a positive cross-over of its MACD and MACD signal line. Volume has been increasing indicating interest on the buying side.
Although the strike price of 3500 has huge call options open interest, a quick up move above 3500 can propel short-covering pushing the stock even further. The max pain stands at 3420 indicating a lack of conviction among sellers.
Thus, it is recommended to LT for a target price of 3740 keeping the stop loss at 3330.
![](https://img.etimg.com/photo/msid-42031747/et-logo.jpg)
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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