The stock of Hindustan Petroleum Corporation Limited (HPCL) (₹389.65) is ruling at a crucial level. Immediate supports are ₹369 and ₹331, whereas the nearest resistances are at ₹415 and ₹467. Though the long-term outlook remains positive, we anticipate higher volatility in the short-term. 

F&O pointers: HPCL May futures closed at ₹389.80 and June futures at ₹392.05. Both maintain a premium over the spot close of ₹389.65. HPCL witnessed a healthy rollover of 60 per cent to next June series and the higher premium indicates rollover of long positions. Option trading indicates that the stock could move in the ₹380-420 range.

Strategy: Consider long strangle on HPCL, which can be constructed by buying June 350-put and June 440-call options simultaneously. We suggest this strategy because we expect considerable swings in price in either direction.

The 350-put and the 440-call closed at a premium of ₹4.40 and ₹4.65 respectively on Friday. Since the lot size is 2,025 shares, this trade will cost ₹18,326.25 for a combined premium of ₹9.05 (₹4.40 plus ₹4.65).

The total premium paid i.e., ₹18,326,25 will be the maximum loss, which will happen if the stock is stuck between the two strike prices. On the other hand, profit potentials are high if the stock moves swiftly in either direction.

We advise traders to hold the position with a stop loss at ₹3.5 (combined premium) and aim for a target of ₹18 (combined premium).

Follow-up: Stop loss would have triggered in Crompton Greaves Consumer long futures.

Note: The recommendations are based on technical analysis and F&O positions. There is a risk of loss in trading.

Published on May 23, 2026