Higher Call/Put OI Bases Signal Sideways Trading

The latest options data on NSE pointed to rising Open Interest (OI) bases as resistance level rose by 1,500 points to 25,400CE, while the support level moved up 500 points to 23,500PE. The 25,400CE has highest Call OI followed by 24,500/ 25,000/ 24,000/ 23,000/ 24,600/ 24,500/ 25,200 strikes, while 25,400/ 25,000/ 24,500/ 24,000/ 23,600/ 23,600 strikes recorded moderate to heavy build-up of Call OI. Coming to the Put side, maximum Put base is seen at 23,500PE followed by 20,350/ 23,000/ 21,000/ 21,500/ 20,400/ 23,300 strikes. Further, 23,500/ 23,300/ 22,700/ 22,500/ 20,350/ 20,400 strikes witnessed reasonable addition of Put OI.

Dhirender Singh Bisht, associate vice-president (technical research) at SMC Global Securities Ltd, said: “Looking at Nifty’s derivatives data, the highest Call Open Interest was observed at the 24,000 and 23,800 strikes, while Put writers were at the 23,500 and 23,300 strikes.”

Call writers preferred to close their positions as they moved to higher bands amid market recovery. For the monthly and quarterly settlement, significant Put OI is visible at 23,500 strike which may act as major support. On higher side, extended momentum can be seen if Nifty moves above 25,400 level, which has highest Call base.

“Broader indices including Nifty and Bank Nifty posted gains and closed on a positive note for the week. FIIs were net buyers in the cash segment last week,” added Bisht.

For the week ended March 28, 2025, BSE Sensex closed at 77,414.92 points, a further gain of 509.42 points or 0.66 per cent, from the previous week’s (March 21) closing of 76,905.51 points. NSE Nifty too moved up by 168.95 points or 0.72 per cent to 23,519.35 points from 23,350.40 points a week ago.

Bisht forecasts: “Traders are advised to monitor these levels closely and track Open Interest developments, as they could further influence market direction. For the upcoming sessions, Nifty has support at 23,200 and may face resistance at 23,800 and 24,000.”

India VIX fell 4.38 per cent to 12.72 level. The positive recovery last week weighed on India VIX as it given its lowest weekly close since October 2024. “Implied Volatility for Nifty’s Call options settled at 13.38 per cent, while Put options concluded at 14.43 per cent. The India VIX, a key indicator of market volatility, concluded the week at 13.30 per cent. The Put-Call Ratio of Open Interest stood at 1.06 for the week,” remarked Bisht.

“The Nifty rollover rate dropped to 76.09 per cent, down from 83.57 per cent in February and below the three-month average of 79.21 per cent, signaling weak momentum for the April series. Bank Nifty rollovers came in at 76.98 per cent, lower than last month’s 81.64 per cent, but still above the three-month average of 73.47 per cent, indicating a similar trend,” observed Bisht.

Major short covering was seen in F&O space throughout the week as FIIs reduced net short positions significantly. The net shorts at the end of the week were just 96,000 contracts from 1.85 lakh contracts seen last week. Even, Nifty futures Open Interest declined during the week suggesting across the board closure of short positions.

Bisht further elaborated that “Nifty positions were largely carried forward within the 23,550-23,600 futures range, while Bank Nifty rollovers at 51,650-51,600. A breach of these levels may trigger further downside in both indices.”

Bank Nifty

Bank Nifty NSE’s banking index closed the week at 51,564.85 points, a hefty gain of 971.30 or 1.91 per cent from the previous week’s closing of 50,593.55 points.