Options data holds undercurrent steam in the mkt

F&O At A Glance:

• Highest Put OI at 24,000PE
• Highest Call OI at 25,000CE
• India VIX fell 1.93% to 13.72 level
• IV of 25,000CE is 8.66 and 11.74 for 24,000PE

The derivatives segment recorded spurt in Open Interest (OI) across all the major indices on NSE as OI rose 27.30 per cent in Nifty,17.16 per cent in Bank Nifty, 56.90 per cent in MidcapNifty, 42.40 per cent in FinNifty. The latest options data on NSE holds the highest Call OI base at 25,000CE for a third consecutive week, while the support level remains at 24,000PE for two weeks in a row.

The 25,000CE has highest Call OI followed by 24,700/ 24,800/ 24,900/ 25,100/ 25,200/25,500/ 26,200 strikes, while 24,700/ 24,600/ 24,900/25,000/ 25,200/ 25,050/ 25,200 strikes. Marginal fall in Call OI is visible at ITM strikes 24,400 onwards.

And on the Put side, the maximum Put OI is seen at 24,000PE followed by 24,400/ 24,500/ 23,700/ 23,500/ 23,300/ 23,800/ 24,600 strikes. Further, 24,400/24,500/23,000/ 23,300/23,700 strikes recorded reasonable addition of Put OI.

Dhirender Singh Bisht, associate vice-president (technical research) at SMC Global Securities Ltd, said: “In the derivatives market, Nifty options indicated the highest Call Open Interest at the 25,000 and 24,900 strikes, while the highest Put Open Interest observed at the 24,400 and 24,000 strikes.”

“Last week, NSE Nifty index surged to an all-time high, driven by strong Q1 results from IT companies, outpacing the Bank Nifty as the benchmark index climbed over half a percent, while the banking index dipped by more than 0.7 per cent on a weekly basis. Major gainers were IT, oil & gas, and FMCG stocks, whereas PSU banks, metal, and realty stocks were among the losers,” added Bisht.

BSE Sensex closed the week ended July 12, 2024, at 80,519.34 points, a net surge of 522.74 points or 0.65 per cent, from the previous week’s (July 5) closing of 79,996.60 points. For the week, NSE Nifty also rose by 178.30 points or 0.73 per cent to 24,502.15 points from 24,323.85 points a week ago.

Bisht forecasts: “It is expected that the bullish momentum is likely to continue in upcoming sessions. Traders are advised to utilize dips to initiate new long positions, particularly as long as Nifty remains above the 24,200 levels.”

India VIX fell 1.93 per cent to 13.72 level. “Implied Volatility (IV) for Nifty’s call options settled at 14.50 per cent, while Put options concluded at 15.22 per cent. The India VIX, a key market volatility indicator, closed the week at 14 per cent. The Put-Call Ratio of Open Interest stood at 0.92 for the week,” remarked Bisht. FIIs built significant long positions as net longs rose to 4 lakh contracts. This situation is signaling a possible profit taking at higher levels. Retail traders are cautious and holding their net shorts. However, renewed cash-based buying by FIIs is expected to cushion the downsides.

Bank Nifty

NSE’s banking index closed the week at 52,278.90 points, higher by 381.45 points or 0.72 per cent from the previous week’s closing of 52,660.35 points. “As for the Bank Nifty, the highest Call Open Interest stood at the 53,000 and 52,500 strikes, while the highest Put Open Interest was seen at the 52,000 and 51,000 strikes,” observed Bisht.