Nifty displayed a strong bullish move. Went long with covered call position

Yesterday 6th April Nifty started the week with a strong opening at 22780 which was 65 points higher than the previous week's close. During the initial hours there was selling pressure observed which brought it down up to near 22500, however, with strong global cues with oil down and Nasdaq futures up, buyers continued to dominate. Towards the end, the upmove resumed and sustained very well which took Nifty to a daily high of 23000 before closing slightly lower at 22968.

The MHAF chart signaled a bullish indication by forming a not-so-strong green candle (with wick at the upper side). The closing price was well above the EBR/EBL band as can be seen in the chart above. The spreadsheet below calculated a bulling trigger at 22885 which gave us ample confidence to go long near the closing time.

Accordingly, we went long long in April futures with 4 lots at 23070. To partially hedge our position, we sold 4 lots of April 23100 call at a hefty premium of Rs 587 (India Vix was above 25). This action created the following status as per table given below.

If Nifty doesn't reverse sharply from the current level and remains above 22500 for about 2 weeks, we should be able to book 80% of the maximum profit available (617.14 points). However, if Nifty breaches 22500 support zone then our reversal bearish trade will trigger at 22482 (BE point) as per the table.

The hypothetical Futures Only strategy we have been recording so far gave a decent profit in March, however, we decided not to track and report that anymore while focusing solely on the F&O strategy and the trades we initiated yesterday.

Cheers and happy trading