Tata Motors: Chart set up & trading strategy

Tata Motors

Observations

- the stock has taken a toll exactly from the Line of Resistance (red line)

- currently the stock is trading near the green trendline

- 280 levels has acted as support on multiple occasions highlighted by green arrow

- 335-340 levels has acted as resistance on multiple occasions highlighted by red arrow mark


Suggested trading strategy for the given set up
Short strangle Strategy

This consists of selling both Call and put option simultaneously

Sell 29 July expiry 340 Call option around 5.3
&

Sell 29 July expiry 280 Put option around 5

Lot size 2850

Max profit potential Rs 29355/- per lot (approximately 11.5% yield potential till 29 July 2021)

Loss in strategy if Tata Motors closes below 269.70 or above 350.30

Take care & safe trading...!!!!

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The strategy gave the desired results of max profit