Here is a Bull Spread strategy on L&T by HDFC Securities

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Bull spread Strategy on LARSEN


Buy LARSEN 1640 CALL at Rs 19 & simultaneously sell 1680 CALL at Rs 9





Lot Size: 575


Cost of the strategy: Rs 10 (Rs 5750 per strategy)


Maximum profit: Rs 17250 If LARSEN closes at or above 1680 on 29 July expiry.


Breakeven Point: Rs 1650


Rational:


>> We have seen long build up in the Larsen Futures where we have seen 13%(Prov) rise in the Open Interest with price rising by 3.2%.


>> The stock price has broken out on the daily chart with higher volumes where it closed at all-time high levels.


>> RSI Oscillators is placed above 60 and slopping upwards, indicating strength in the current uptrend.


>> Plus DI is trading above Minus DI while ADX line is placed above 25, indicating momentum in the uptrend.

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