Informist, Monday, Sep 4, 2023
By Maitri Seth
MUMBAI – Analysts anticipate that the Nifty 50 will continue to gain in the next session, and so do traders, as they sold put options of 19500 strike prices of the index. Meanwhile, premium of call options at 19700 levels saw a significant surge, with market players pegging the resistance at this level.
“The Nifty 50 crossed a very crucial resistance of 19500 points today, and atleast for tomorrow we expect the same positivity to continue,” said Raj Deepak Singh, derivative analyst at ICICI Direct. The analyst said that 19400-19450 is the next crucial support for the benchmark index.
Henceforth, the 19500 strike prices saw maximum open interest buildup among put options, as market participants expect that the Nifty 50 will move above these levels in the next session. Premium at 19500 slipped 61.7% to 44 rupees. Selling was also seen at put bets of 19400 and 19450 levels, where premium fell 68.8% and 67.3% to 21 rupees and 29.05 rupees, respectively.
Meanwhile, 19700 and 19750 strike prices saw maximum change in open interest on the call side, as traders estimate these levels as crucial resistance for the Nifty 50. Premium at 19700 and 19750 strike prices rose 28.5% to 11.05 rupees and 10% to 5.50 rupees, respectively. Some buying was also seen in call options of 19800 strike price, where the premium inched 4.8% higher to 3.30 rupees.
Hence, the 50-stock benchmark index is likely to move in 19500-19700 points in the next session. Today, the Nifty 50 closed 0.5% higher at 19528.80 points. Global cheers on reports of China taking measure to revive the country’s economy, coupled with largely positive cues from the Wall Street, will continue to aid the indices.
“Meanwhile, the market breadth was inclined strongly on the advancing side, thanks to the upbeat tone in mid-cap and small-cap pack,” said Ajit Mishra, senior vice-president, technical research at Religare Broking.
Analysts expect banking stocks to outperform other sectors in the next session, with private bank stocks taking the lead. Further, some large-cap information technology stocks are also likely to show gains on Tuesday.
“Amid all, we reiterate our view to focus on stock selection and preferring auto, IT and metal for long trades,” added Mishra.
The September futures contract of the Nifty 50 today closed at a premium of 85.55 points to the spot index. Open interest in the contract was up 2.1% at 9.8 mln, according to provisional data.
–Nifty 50 Sep closed at 19614.35, up 102.25 points; 85.55-point premium to spot index
–Nifty 50 Oct closed at 19706.45, up 100.35 points; 177.65-point premium to spot index
–Nifty 50 Nov closed at 19815, up 109.95 points; 286.2-point premium to spot index
Bharat Heavy Electricals, HDFC Bank, IDFC First Bank, Reliance Industries, and Coal India, were among the most actively traded underlying stocks. End
Edited by Manisha Baxla
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