Highest Call & Put OI bases at same strike point to range-bound trading

The significant decline in resistance level by 800 points to 18,700CE and 200points rise in support level to 18,700PE point to limited range trading for the week ahead as highest Call and Put bases are at the same strike as per the data on NSE after Friday session.

The 18,700CE has highest Call OI followed by 18,800/ 18,600/ 18,650/ 19,000/ 18,900/ 19,300/ 19,600 strikes, while 18,600/ 18,700/ 18,900/ 18,800/ 18,900/ 19,000 strikes witnessed significant build-up of Call OI.

Coming to the Put side, maximum Put OI is seen at 18,700PE followed by 18,600/ 18,000/18,300/ 18,400/ 18,500/ 18,200 strikes. Further, 18,300/18,600/ 18,500/ 18,450 strikes recorded reasonable addition of Put OI. Dhirender Singh Bisht, associate vice-president (technical research-equity) at SMC Global Securities Ltd, said: “From the derivatives front, hefty Call writing was observed at 18,600 & 18,700 strikes, while Put writers were seen adding marginal Open Interest in lower strikes.”

“Once again Indian markets remained sideways in the week gone by as Nifty and Bank Nifty, both the indices traded in defined range to end the week near unchanged line. Profit booking from higher levels was observed in the later part of the week as Nifty ended below 18,600 mark, while Banking index closed below 44,000 mark on local bourses,” added Bisht. BSE Sensex closed the week ended June 9, 2023, at 62,625.63 points, a minute gain of 78.52 points or 0.12 per cent, from the previous week’s (June 2) closing of 62,547.11 points. During the week, NSE Nifty edged up by 29.30 points or 0.15 per cent to 18,563.40 points from 18,534.10 points a week ago.

Bisht forecasts: “Technically, the rally seen in the previous weeks, in Indian markets, seems exhausted as of now, as we can expect further rounds of profit booking in upcoming sessions. However, the bias still remains in favor of bulls and we suggest traders use these dips to create fresh longs. We also expect that the market may witness sector rotation in upcoming sessions, as stock-specific action likely to remain on radar. On the downside, Nifty may get support in the 18,450-18,400 levels, while any sharp upside is likely to cap in the 18,650 to 18,750 level.” India VIX fell 1.22 per cent to 11.12 level. India VIX was hovering at 11 level despite some profit booking at higher levels and upcoming crucial events.

Bank Nifty

NSE’s banking index closed the week at 43,989 points, a modest fall of 51.15 points or 0.11 per cent from the previous week’s closing of 43,937.85 points.