The stock of Apollo Hospitals Enterprises (₹6,611.55) is ruling at a crucial level. Immediate resistance levels are at ₹6,708 and ₹6,955. A close above the latter will change the medium-term outlook positive. The stock finds support at ₹6,422 and ₹6,274.
F&O pointers: Apollo Hospitals March futures and April futures closed at ₹6,609.55 and ₹6,657.25 respectively against the spot close of ₹6,611.55.
The discount in the current month and low rollover (just 10 per cent so far into April series) indicates the cautious mood of the investors. Nevertheless, we expect the stock to move in a narrow range with a positive bias.
Option trading indicates that the stock could move in the ₹6,200-6,800 range.
Strategy: Buy March expiry 6600-call that closed with a premium of ₹63 on Friday. As the market lot is 125 shares this would cost traders ₹7,875. This would be the maximum loss and that will happen if the stock fails to cross ₹6,600 before expiry.
We advise traders to keep initial stop-loss at ₹25. Traders can aim for a premium of ₹90-105. Hold the trade for a maximum of three days. The stop-loss can be shifted ₹50 if the stock opens on the front foot and the premium rises above ₹65.
Follow-up: Book profit on Maruti Suzuki as the premium of 11500-call jumped sharply. Long trade on 200-call on BHEL (recommended a fortnight ago) has hit the target.
Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading.
