United Spirits Limited is showing a positive trend in its long-term Elliott Wave structure, based on monthly chart analysis. Since 2020-2021, there has been a clear shift from a correction phase to an impulse phase, indicating a new bullish cycle, with important Fibonacci targets ahead.
From the low of Wave IV, the price has formed a five-wave pattern. Waves (1) and (2) set the trend direction, while Wave (3) exhibits strong upward momentum. Wave (4) seems to form a sideways contracting triangle, hinting at a potential rise in Wave (5).
Fibonacci extension levels indicate key upside targets. The ₹1,798 area relates to the 1.236 extension, serving as a cautious target for the fifth wave. A move towards ₹1,962 aligns with the 1.618 Fibonacci level. Prices may react around these points as Wave I approaches completion.
After Wave I concludes, a corrective Wave II is expected, with support likely around the 0.382 retracement level, near ₹1,208. This aligns with past price patterns, suggesting a possible technical reaction. This pullback is seen as corrective, not a sign of trend reversal.
The analysis suggests that selling is not a wise choice. The Elliott Wave structure holds as long as the price remains above ₹84, indicating long-term bullish prospects.
Currently, with the consolidation viewed as a Wave (4) triangle, option premiums are lower. Implied volatility for United Spirits has dropped to about 22% in early December 2025, down from over 30% after the earnings spike in October. This situation allows for cheaper long positions in preparation for an upcoming rise.
In the next few weeks, implementing a bull call spread could be a solid strategy to aim for the expected Wave (5) rally. A trader might consider buying a January 2026 call option with a strike price of around ₹1,600 and selling a call at ₹1,800. This trade limits risk and is designed to profit as the price moves toward the initial target of ₹1,798.
A more cautious approach could involve selling out-of-the-money put credit spreads, aligning with the view that selling isn’t advisable. For example, selling a January 2026 ₹1,400 put while buying a ₹1,350 put for protection can generate premium and profit as long as the stock stays above the short strike. This strategy is supported by the company’s impressive performance, showing a 15% year-over-year rise in net profit for the quarter ending September 2025.
Market data backs this bullish outlook, with significant open interest growth in the January 2026 ₹1,700 and ₹1,800 call options. This indicates that other investors are also preparing for a significant upward move soon. Continued excitement around premiumization in the beverage sector reinforces this positive sentiment.
As the stock price approaches the ₹1,798–₹1,962 target range, traders should watch for signs that the rally is losing strength. A previous sharp rally in 2023 was followed by a multi-month correction. Once Wave I appears to finish, it would be wise to take profits on bullish positions in anticipation of a corrective Wave II pullback towards the ₹1,208 level.
Any short-term weakness during this consolidation phase should be seen as a chance to build positions rather than a signal of a trend change. A similar sideways movement occurred in late 2024 before the price surged from the ₹1,350 level. With the main trend remaining upward, the focus should be on preparing for the next upward leg.
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