Derivative strategy on Nifty by Motilal Oswal Securities

Option Strategy:
 
NIFTY:  BEAR PUT SPREAD
 
Buy 9600 PE 1 lot
Sell 9500 PE 1 lot

 
Rationale:
 
1. Nifty failed to cross 9700 and broken immediate support zone
2. It has been closing on negative note from last four sessions
3. Fresh writing at 9600 & 9700 CE could drag the index to lower levels
4. Put unwinding in 9600 strike also suggest that bears are getting grip for a profit booking decline
5. Thus low risk / Hedge strategy Bear Put Spread is recommended
 
Reward: 5250                    
Risk: 2250
 
Disclaimer: Chandan Taparia is a Derivatives and Technical Analyst at Motilal Oswal Securities.