MUMBAI: Traders have built up huge positions on the Zee Entertainment Enterprises Ltd (Zeel) stock counter with the 90-day period for merger talks with Sony Pictures ending on December 21. The traders are anticipating the two companies to announce the result of merger negotiations.
A total of 4.68 crore shares were traded on Tuesday against the three-month daily average of 2.84 crore, NSE cash market data shows.
Futures traders raised their open positions across contracts by 11% to 64,382 contracts, provisional data indicated.
An open position refers to an outstanding buy or sell trade. A trader who buys expects a rise in price while her counterparty expects the price to correct.
Provisional data shows that bearish options sellers covered their short positions at Rs 340 strike price. Bullish option sellers sold more shares at Rs 340 strike price.
These actions imply traders expecting the share to break above Rs 340 and test the 52-week high of Rs 378.7.
The support lies in the range of Rs 322-330 and thereafter between Rs 295-300, said Siddarth Bhamre, director, alternative investments & research, InCred Equities.
The stock ended at Rs 341.7, up 3% on Tuesday, and above the 50-day simple moving average of Rs 339, HDFC Securities’ data indicated.
Share likely to test 52-week high of Rs 378
Bearish options sellers covered their short positions at `340 strike price. Bullish option sellers sold more shares at Rs 340 strike price. These actions imply traders expecting the share to break above Rs 340 and test the 52-week high of Rs 378.7.