Options Data Points To Stronger Resistance Levels

Implied Volatility for Nifty’s Call options settled at 14.72%, while Put options concluded at 15.22%. The Put-Call Ratio of Open Interest-PCR OI- for the week was 1.34. The resistance level surged by 2,000 points to 27,000CE and the support level marginally eased by 550 points to 22,450PE as per the latest data on NSE after the Diwali Muhurat trading for Samvat-2081

The resistance level surged by 2,000 points to 27,000CE and the support level marginally eased by 550 points to 22,450PE as per the latest data on NSE after the Diwali Muhurat trading for Samvat-2081.

The 27,000CE has highest Call OI followed by 24,800/ 24,300/ 24,400/ 25,000/ 24,700/ 25,200/ 25,400/ 24,200/ 24,250 strikes, while 25,500/ 25,000/24,400/ 25,300 strikes recorded modest addition of Call OI. ITM strikes 24,000/ 24,250/ 24,200/ 24,100 strikes witnessed minute fall in OI.

Coming to the Put side, maximum Put OI is seen at 22,450PE followed by 22,500/ 23,000/ 23,500/ 24,000/ 24,200/ 24,300/ 24,400 strikes. Further, modest Put OI build-up was visible at 22,900/ 23,700/ 23,750/ 24,000 strikes. Only 23,050PE recorded a minute OI fall.

Dhirender Singh Bisht, associate vice-president (technical research-equity) at SMC Global Securities Ltd, said: “In the derivatives market, the highest Call Open Interest for Nifty seen at the 24,500 and 24,300 strikes, while the highest Put Open Interest was at the 24,200 and 24,000 strikes. More writing was seen in Call options compared to Put options indicating pressure on a bounce.”

Analysts expect that NSE Nifty may have support in 23,800–24,000 range and a possible short-covering rally from these levels. The Open Interest of 1.3 crore shares points to stability of Nifty OI during the last week. FII net shorts also fell marginally to 1.3 lakh contracts.

“Last week, NSE Nifty closed relatively flat, while Bank Nifty performed well, finishing in the green. Foreign institutional investors continued to be net sellers, and disappointing Q2 results added pressure to the broader indices. The IT and auto sectors were the biggest losers, whereas public sector banks and media stocks saw a rebound, emerging as the major gainers for the week,” added Bisht.

BSE Sensex closed the week ended November 1, 2024, at 79,724.12 points, a net recovery of 321.83 points or 0.40 per cent, from the previous week’s (October 25) closing of 79,402.29 points. For the week, NSE Nifty also moved up by 123.55 points or 0.51 per cent to 24,304.35 points from 24,180.80 points a week ago.

Bisht forecasts: “From a technical perspective, Nifty’s next support levels are at 24,000 and 23,800, with key resistance at 24,500. Currently, Nifty is trading below its 100-day exponential moving average, and the next support at the 200EMA stands at 23,500. The market is viewed as a sell on rise scenario as long as it remains below the 24,500 level.”

Nifty futures are now trading at a premium of just 12 points, suggesting the possibility of short covering.

India VIX gained 2.25 per cent to 15.90 level. “Implied Volatility for Nifty’s Call options settled at 14.72 per cent, while Put options concluded at 15.22 per cent. The India VIX, a key market volatility indicator, closed the week at 15.51 per cent. The Put-Call Ratio of Open Interest (PCR OI) for the week was 1.34,” said Bisht.

Bank Nifty

NSE’s banking index closed the week at 51,673.90 points, lower by 886.45 points or 1.74 per cent from the previous week’s closing of 50,787.45 points. “For Bank Nifty, the prominent Call OI was seen at the 52,000 strike, whereas notable Put OI at the 51,500 strike,” remarked Bisht.