Buy 1 Lot 1160CE
Sell 2 Lots 1200CE
Target Profit: Rs 4,000
Stop Loss: Rs 1,000
Rationale: Initiation of open interest in last week ahead of the expiry indicates short covering in the offing. On the higher side the Call congestion indicates head room open up to 1200. Considering the pullback nature of trade and limited days for expiry Call Ratio is deployed
Option Strategy : Put Ratio Spread
Buy 1 Lot 740 PE
Sell 2 Lots 700 PE
Target Profit: Rs 4500
Stop Loss: Rs 1200
The stock added shorts in the week of expiry. Call writing in higher strike may not let the stock move higher. On the other hand the Puts congestion indicates downside room up to 700.
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Shubham Agarwal is a head of Quantitative Research, Motilal Oswal Securities