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Equity Futures: Nifty 50 surpassing 17500 triggers bullish bets

Informist, Monday, Aug 8, 2022

 

By Joe Milton

 

MUMBAI – The Nifty 50 index surpassed its crucial resistance of 17500 points which prompted traders to initiate long positions in the hope of more gains. 

 

The headline index opened flat but managed to move steadily higher and surpassed 17500 points for the first time since Apr 13. The continued uptrend in the headline index prompted traders to create long positions in the August futures of the index. 

 

Open interest in the August futures surged over 10% to 11.1 mln, while the contract rose 0.8%, which indicates the bullish bets taken by traders. In the spot market, the 50-stock index closed 0.7% higher at 17525.10 points. 

 

In the options segment of Nifty 50 expiring on Thursday, the sharp gains prompted call writers to trim their position at 17500 strike price and move to higher strike prices. Accordingly, a significant number of positions were added across 17600-17900 strike prices. 

 

On the other hand, put option sellers also shifted to higher strikes with sizeable open interest added at 17300 and 17400 strike prices. 

 

For the Nifty 50 index, the support level has now shifted higher to 17300 points, while 17700-17750 points are the next levels to watch out for on the upside, said Ruchit Jain, lead research analyst, 5paisa.com. 

 

The resilient performance of bank stocks continued with the Nifty Bank index closing above its resistance level of 38000 points. The index was struggling to close above this level for the last three sessions despite crossing it intraday. 

 

Today, sustained gains triggered the addition of long positions in the August futures of the Nifty Bank index. Open interest in the contract surged 14% to 2.7 mln, while the contract gained over 0.9%. 

 

In the cash market, the Nifty Bank index closed 0.8% higher at 38237.40 points. 

 

Nifty Bank call option sellers unwound their position at 38000 and 38500 strike prices and shifted higher to 39000 strike price in the contracts expiring on Thursday. 

 

On the back of this, analysts expect the Nifty Bank to inch higher towards 39000 points in the near term. 

In the put option segment of Nifty Bank expiring on Thursday, the highest open interest was at 38000 strike price and analysts expect the index to find immediate support at this level. 

 

–Nifty 50 Aug closed at 17560.00, up 143.85 points; 34.90-point premium to spot index

–Nifty 50 Sep closed at 17632.35, up 146.90 points; 107.25-point premium to spot index

–Nifty 50 Oct closed at 17665.00, up 139.15 points; 139.90-point premium to spot index

 

The total turnover in the futures and options segment of the National Stock Exchange was 88.4 trln rupees compared to 74.4 trln rupees Friday.    

 

The turnover in index options was 85.3 trln rupees compared to 71.2 trln rupees on Friday. The total premium turnover of the index and stock options was 387.2 bln rupees compared to 416.8 bln rupees in the previous session. 

 

Reliance Industries, HDFC Bank, ICICI Bank, Titan Co, Adani Ports and Special Economic Zone, State Bank of India, Mahindra & Mahindra, Bharti Airtel, Bajaj Finance, Axis Bank, and Adani Enterprises were among the most actively traded underlying stocks. End

 

Edited by Maheswaran Parameswaran

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

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© Informist Media Pvt. Ltd. 2022. All rights reserved.

 

Source: Cogencis

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