Bull Spread Strategy for ICICI Bank by Nandish Shah of HDFC Securities

The stock price has given breakout on the daily chart by trading above the downward sloping trendline resistance.

Bull Spread strategy on ICICI BANK

Buy ICICI BANK February 550 Call at Rs 7.90 & simultaneously sell 570 call at Rs 2.90

Lot Size: 1375
 

Cost of the strategy Rs 5 (Rs 6875 per strategy)
 

Maximum profit Rs 20625 If ICICI Bank closes at or above 570 on February expiry.
 

Break even Point Rs 555

        

Rationale:

• Long build up is seen in the ICICI Bank Futures’ during this week where we have seen rise in the Open Interest with price moving up by 7%.
   
• The stock price has given breakout on the daily chart by trading above the downward sloping