Call OI declining at ITM strikes

After the positive weekly close, the support level and resistance levels rose 200 points each to 20,000PE and 21,000CE, respectively. The 21,000CE has highest Call OI followed by 20,400/ 20,500/ 20,600/ 20,800/ 20,300/ 20,000 strikes, while 20,400/ 20,800/ 21,000/ 21,100/ 20,300 strikes recorded reasonable addition of Call OI. Barring 20,550CE, Call OI declined at ITM strikes.

On the Put side, maximum Put OI is seen at 20,000PE followed by 19,000/ 19,500/ 20,200/ 19,900/ 19,800/ 19,700 strikes. Further, 20,200/19,500/ 20,100/ 20,300 strikes witnessed heavy build-up of Put OI. Almost all the Put strikes witnessed OI rise.

Dhirender Singh Bisht, associate vice-president (technical research-equity) at SMC Global Securities Ltd, said:

The consolidation near 19,800 level during the truncated November expiry week, Call strikes form 19,800 and higher have seen significant writing across the board. Short covering is more likely in Nifty towards 20,000 and higher if it is able to sustain above 19,800 level. It’s better to stay on the sidelines if Nifty falls below 19,650 level.

BSE Sensex closed the week ended December 1, 2023, at 67,481.19, a net recovery of 1,511.15 points or 2.29 per cent, from the previous week’s (November 24) closing of 65,970.04 points. During the week, NSE Nifty advanced 473.20 points or 2.39 per cent to 20,267.90 points from 19,794.70 points a week ago.

Nifty, for November F&O series, ended at 20,133 level, a gain of 6.12 per cent and Bank Nifty settled at 44,481, gain of 4.41 per cent. Open Interest in Nifty fell eight per cent and began the December series with 1.07 crore shares in OI. Nifty recorded lower rollover of 73.06 per cent from 83.39 per cent in November series and 3-month average of 80.65 per cent, while rollover cost was 137.45 points. It signals that some of the short covering in Nifty has not got carried forward, and Nifty may rise this week.

India VIX fell 2.42 per cent to 12.38 level.

Despite a 1,000-pts surge from Oct lows, FPIs net shorts are still high near 1.3 lakh contracts. The markets staged a smart recovery owing to renewed FPI buying. According to ICICIdirect.com, FIIs net shorts in Index futures remained unchanged near 1.3 lakh contracts. Activities in index futures have been relatively low due to continued range-bound move as FIIs net buy worth Rs500 crore last week. FII net longs in stock futures increased near 45,000 contracts from 9,000 contracts seen in previous week.

Bank Nifty

NSE’s banking index closed the week at 44,814.20 points, higher by 1,045.10 points or 2.38 per cent from the previous week’s closing of 43,769.10 points.