Trading recommendations - Nov 28, 2004

Dr Reddy - This pharmaceuticals heavy-weight was recommended at the 774 levels and has been covered in editions Dtd Nov 07, 14 & 21. Click here to view the previous editions. The scrip was accurately advocated as making a rounding bottoms formations and was predicted to enter a new bullish zone as the short term congestion zone would be surpassed. The scrip has managed a close above the 800 benchmark and is likely to witness accelerated upmoves as the uncertainty in the market is likely to benefit the pharmaceuticals sector. We recommend a buy for the patient investor / trader.

Your call of action - .

• Investors / cash segment players - Buy at the current levels and hold with a stop loss at the 768 levels. Expect profit taking between the 850 - 865 levels in a conducive market in a short / medium term time frame.

• Aggressive F&O traders - Patient traders may buy the December futures as long as the futures trade above the 800 mark. Maintain a stop loss at the 772 levels and a profit target of 844 in the short / medium term. Options players may buy the Dec 800 calls at a suggested premium of Rs. 25

• Derivatives contract size - Market lot = 200 shares. F&O margin = approx Rs 27,000 (subject to change daily )

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