📉 Chart Context:
📊 Derivatives Insight:
📈 Strategy:
Strategy Bias: Neutral / Mildly Bearish
⚠️ Note: This strategy is suitable only for investors already holding a sizeable position (≥500 shares) in Reliance. It is not a recommendation to buy the stock solely for option writing.
With 500+ shares held, this aligns perfectly for a covered call:
⚠️ Risk Management:
📌 Conclusion:
This is a textbook low-risk income strategy using technical resistance, OI data, and IV edge. Unless a fresh breakout emerges, ₹1600 stands firm.
Disclaimer: This analysis is for educational and informational purposes only. It does not constitute investment advice or a recommendation. Options trading involves risk. Always do your own research or consult a financial advisor before making decisions.
- Reliance recently rallied ~25% from lows near ₹1,150 to ₹1,450.
- The rally stalled at the broken lower trendline of a long-term channel, turning resistance.
- Price action now showing rejection around ₹1,435–₹1,450 zone — a historical supply area.
📊 Derivatives Insight:
- July ₹1600 CE has the highest Open Interest across the chain: 3.6 lakh+ contracts.
- This strike acts as a clear ceiling for market participants.
- IV for ₹1600 CE is elevated at 21.8%, indicating overpricing of far OTM risk.
📈 Strategy:
Strategy Bias: Neutral / Mildly Bearish
⚠️ Note: This strategy is suitable only for investors already holding a sizeable position (≥500 shares) in Reliance. It is not a recommendation to buy the stock solely for option writing.
With 500+ shares held, this aligns perfectly for a covered call:
- Sell July ₹1600 CE at ₹7.20
- Generate passive income (~₹3,600/lot) while capping gains ~13% above CMP
- Play on sideways or weakening structure without exiting core position
⚠️ Risk Management:
- If Reliance breaches ₹1600 before expiry, gains above this are capped
- Position sizing and pledge margin must be managed correctly
📌 Conclusion:
This is a textbook low-risk income strategy using technical resistance, OI data, and IV edge. Unless a fresh breakout emerges, ₹1600 stands firm.
Disclaimer: This analysis is for educational and informational purposes only. It does not constitute investment advice or a recommendation. Options trading involves risk. Always do your own research or consult a financial advisor before making decisions.
注释
Expecting range-bound action; covered call remains low-risk income strategy while upside remains capped.交易手动结束
The original setup relied on price staying capped near ₹1460–₹1500. That cap has eroded. With breakout strength building, the risk of assignment outweighs potential yield. Strategy stands invalidated — no longer a favorable covered call candidate at this stage.注释
I think, overall the strategy held. Reliance didnt hit 1600. It was a good call.
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