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The short-term outlook for DLF has changed positive. The stock now finds strong support at ₹140. As long as the stock sustains above this level, it has the potential to reach ₹178-180.
The stock finds immediate support at ₹148 and resistance at ₹161. A close above ₹161 will trigger a fresh rally in DLF that could take it higher to ₹180.
F&O pointers: DLF futures witnessed a modest rollover of 13 per cent to February series. Most of the rollovers were on long positions. Option trading indicates a strong support at ₹140.
Strategy: Traders can consider a bull-call spread on DLF using February options.
This can be initiated by selling ₹160 call while simultaneously buying ₹150 call. They closed with a premium of ₹8.95 and ₹13.20 respectively. The maximum gain and loss is limited in bull-call spread.
Maximum gain will be the difference between strike price less the net premium paid (₹4.25), which works out to ₹5.75/contract (or ₹11,500).
For that to happen, DLF has to settle at or above ₹160 at the time of expiry in the month of February.
Maximum loss (₹4.25 or ₹8,500) will occur if DLF falls below ₹150 at the time of expiry.
Traders can consider exiting the position if the loss mounts to ₹6,500.
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