The stock of Ashok Leyland (₹249.85) is ruling at a crucial level. If the current rally sustains, it can rise to ₹290. Immediate support levels for the stock are at ₹233 and ₹209. A close below the latter will change the short-term outlook negative. We expect the stock to witness some moderation from the current level.
F&O pointers: Ashok Leyland July futures is now at ₹251.20 against the spot price of ₹249.85. The counter has been shedding open interests over the last four days while the underlying stock was trading flat.
The marginal premium of futures over spot price and unwinding of open interests signals that traders are cautious. Option trading indicates that the stock could move in the wide ₹220-275 range.
Strategy: Consider buying Ashok Leyland 250-put that closed with a premium of ₹6 on Friday. As the market lot is 2,500 shares, this would cost ₹15,000. This is the maximum loss in this trade and that would happen if Ashok Leyland rules at or above ₹250.
Keep the stop-loss at ₹2.50. Shift this to ₹5.50 if the stock of Ashok Leyland opens on a negative note on Monday, pushing the put option premium higher. Target can be ₹9.
Follow-up: Though the stock of LICI moved on the expected lines, it turned weak lately. Traders who have not booked profits can exit from LICI 960-call.
Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading.
Published on July 5, 2025
