The Bank of Japan's two-day policy meeting on Dec. 19 and 20

BSE Sensex (1919317.25)   and Nifty (5879.60) closed  down  by 0.6% and 0.5% respectively last week.Nifty Future December was quoting at  39  points premium.Nifty call option December  5900 was very active.Support for Sensex is at  19150. Resistance for Sensex is at 19550. Support for Nifty is at 5840 and resistance at 5910.

SBI  and  NMDC added Open Interest in December  series.Huge position was build up at  SBI  December  Call Option Strike Price 2300.Good build up was also seen at  NMDC  December Call Option Strike Price 160.

Strategy  for Futures Option players.                                                                 

(1) CAIRN (324.65) lot size 1000 shares                                                                                                                                                                                                                         

Buy One Call Option of  December Strike Price 320@6.95 Rs

Sell One Call Option of  December Strike Price 340@1.10 Rs.

Premium .Paid= 6.95*1000=6950.00 Rs.

Premium Received= 1.10*1000=  1100.00 Rs.

Net Premium Paid=6950-1100= 5850.00 Rs.

Maximum Profit==340-320 =20*1000=20000-5850= 14150 Rs.-

 Maximum Loss=  5850.00 Rs.

Break Even = 325.85

(2) IDEA (96.10)   Future-Lot Size 4000 shares.

Buy One Lot   December  Future  @96.10 Rs

Sell One Call Option of  December Strike Price 100@ Rs.1.15

Premium Received=1.15*4000= 4600.00 Rs

Maximum Profit=100-96.10 == 3.90*4000=.15600 + 4600 =20200.00 Rs.

Max Loss=Unlimited.

           

Trading Idea

(1) TCS (1242.90) Buy this stock in decline and trade                                                                                                                                                                                                                                .

(2) WIPRO (375.95) Buy this stock in decline and trade

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