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The stock of Coal India (₹393.15) is ruling at a crucial level. Immediate support levels are at ₹369 and ₹354. A close below the latter will change the long-term outlook negative.
On the other hand, nearest resistance is at ₹406. A close above ₹467 will change the long-term outlook positive for the stock. We expect Coal India to move in a narrow range with a positive bias.
F&O pointer: Coal India witnessed a rollover of 92 per cent to May series from April. The May futures closed at ₹394.10 against the spot price of ₹393.15. This premium signal rollover of long positions. Option trading indicates that Coal India will move in the ₹370-450 range.
Strategy: Buy 395-call on Coal India that closed with a premium of ₹14 on Friday. As the market lot of Coal India is 1,050 shares, this strategy would cost ₹14,700. This would be the maximum loss and can happen if the stock is stuck at or below ₹395 on expiry.
Profit potentials are huge if the stock of Coal India surges sharply. The break-even point is ₹409.
Keep an initial stop loss at ₹7. Shift it to ₹13 if the stock opens on firm note and the premium moves past ₹15. Traders can aim for a target of ₹20. Stop loss can be shifted deftly to protect the profits.
Follow-up: AU Small Finance Bank moved up as expected and might have provided profit opportunities.
Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading.
Published on April 26, 2025
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