Options data indicates rising steam in mkt
Resistance level remained at 24,000CE for 3rd consecutive week; FIIs continued to close their shorts, while taking long positions; Retail participants booked profits at higher levels
image for illustrative purpose
The latest options data on NSE after Friday session is pointing to range-bound trading on a positive note for the week ahead. The resistance level remained at 24,000CE for the third consecutive week, while the support level eased by 400 points to 23,000PE.
The 24,000CE has highest Call OI followed by 25,000/ 24,500/ 23,600/ 23.500/ 23,900/ 23,900/ 26,000/ 27,000/ 24,800/ 24,150/ 24,600 strikes, while 24,900/ 24,400/ 24,100/ 24,00/ 23,700/ 23,500/ 23,600/ 23,700 strikes recorded hefty build-up of Call OI. Miniscule OI fall is seen at ITM strikes from 23,100CE inwards.
Coming to the Put side, maximum Put OI is visible at 23,000PE followed by 22,500/ 22,800/ 23,400/ 22,000/ 22,400/ 23,300/ 23,200/ 23,100/ 22,850/ 22,600/ 22,400/ 23,600/21,500/ 22,200 strikes. Further, 22,900 /23,000/ 22,950/ 23,400/ 23,450/ 22,850/ 22,750 strikes recorded moderate to reasonable addition of Put OI. Put ITM strikes recorded moderate OI fall.
Dhirender Singh Bisht, associate vice-president (technical research) at SMC Global Securities Ltd, said: “From derivatives front, marginal put writing was observed at 23,500 strike, while Call writers were seen shifting at 24,000 strike with highest Open Interest concentration.”
“Indian markets witnessed highly volatile sessions during last week as Nifty managed to close nearly unchanged and above the 23,500 mark. Meanwhile profit booking was witnessed in FMCG, pharma & auto space,” added Bisht.
BSE Sensex closed the week ended June 21, 2024, at 77,209.90 points, a net recovery of 217.13 points or 0.28 per cent, from the previous week’s (June 14) closing of 76,992.77 points. For the week, NSE Nifty also recouped part of previous week’s loss by 35.50 points or 0.15 per cent to 23,501.10 points from 23,465.60 points a week ago.
Bisht forecasts: “From technical front, NSE Nifty is inching towards its new record highs with some consolidation seen at higher levels. For the upcoming sessions, the Nifty has a major support now in zone 23,200-23,000 zone, while for Bank Nifty 51,000-50,500 zone would act as a support area. For the upcoming week we expect that bullish momentum is likely to carry towards new record highs and traders should use dips to create fresh longs as far Nifty holds above the 23,200 mark broadly. A decisive close above 23,600 could trigger an uptrend towards the 24,000 zone as well. Meanwhile, a stock-specific trading approach is proving effective, and participants should align their positions accordingly.”
India VIX, a key market volatility indicator, fell 1.24 per cent to 13.18 level. “Implied Volatility for Nifty’s Call options settled at 14.66 per cent, while Put options concluded at 15.60 per cent. The Put-Call Ratio of Open Interest (PCR OI) stood at 1.20 for the week,” remarked Bisht.
FIIs continued to close their shorts, while taking long positions. Retail participants booked profits at higher levels. The net shorts of 2 lakh contracts moved to below 25,000 contracts. Nifty futures OI also fell further suggesting ongoing profit booking at higher levels in the Index. Analysts forecast upward bias for Nifty and project 24,000 levels amid formation of fresh long positions.
Bank Nifty
NSE’s banking index closed the week at 51,661.45 points, marginally up by 1,659.45 points or 3.31 per cent from the previous week’s closing of 50,002 points. “Bank Nifty also tested its record highs and wrapped the week with gains of more than three per cent, supported by sharp surge in banks like HDFC Bank, AXIS Bank & ICICI Bank,” observed Bisht.
