Go long on Bharti Airtel


The stock of Bharti Airtel (₹391.8) rulesat a crucial level. One more conclusive close above ₹390 will turn the outlook to positive. In that case, the immediate resistance appears at ₹427 and a sustained rally can take Bharti Airtel to ₹490. On the other hand, the stock finds an immediate support at ₹365 and a close below this level can weaken it to ₹331. However, it appears the stock’s outlook can turn positive in the near term.

F&O pointers: The counter added fresh long positions on Friday along with rise in share price. Besides, the counter has been witnessing a strong build-up open positions in the last two weeks. From 1.30 crore shares as on August 24, open interestsurged to 4.84 crore shares. Trading in option indicates that the stock can move in ₹360-400 range.

Strategy: Traders with a high-risk appetite can consider going long on Bharti Airtel futures, with an initial target of ₹427, by keeping the stop-loss at ₹383.

Risk-averse traders can consider buying ₹400-strike call on Bharti Airtel. The option closed with a premium of ₹7.75. With the market lot being 1,700 shares, this will entail an outgo of ₹13,175. The maximum loss a trader may suffer would be the premium paid (₹13,175). We advice traders to exit if the premium of the option increases to ₹18 or dips to ₹2.5.

Follow-up: Hold Coal India (bull-call spread) positions.


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