Informist, Wednesday, Feb 28, 2024
By Anshul Choudhary
MUMBAI – The Nifty 50 will keep facing resistance at the crucial 22000-point mark, going by the positioning in the index’s monthly call options of the February series. Traders added short bets and squared off some long positions in the index’s 22000 strike price call option.
Out-of-the-money call options of the Nifty 50 were sold as well, with premiums declining across the board, indicating caution in the market. The caution among investors is a result of worries that inflation data in the US and some other regions is not supporting the market’s earlier expectations of at least two to three rate cuts in 2024.
“We saw call writing at 22000-22200 calls, and also saw unwinding in puts,” Deven Mehta, technical research analyst at Choice Equity Broking said. Today, the Nifty 50 opened slightly higher but later fell, ending 1.1% lower at 21951.15 points.
The highest open interest addition was seen at the 22200 strike price call option, followed by the 22100, and 22000, which are likely to act as immediate resistance levels for the Nifty 50. The 22200 strike price had the highest open interest among call options at 16.29 mln. Premium on the 22000 strike price call option fell 196 rupees to 43 rupees, while that on 22100 fell 144 rupees to 24 rupees, and that on 22200 fell 95 rupees to 13 rupees.
In line with the risk aversion in global equities, put options of the benchmark index were bought, with the 21800 strike price being the most active. The premium on the 21800 strike price put option rose 31 rupees to 44 rupees, while that on 21900 strike rose 62 rupees to 85 rupees, and that on 21600 strike rose 4.50 rupees to 8.40 rupees.
The highest open interest addition was seen at 18650 puts, followed by 21800, which is seen as a strong support for the Nifty 50. The highest open interest on the put side is at 21500 with 9.5 mln open positions.
–Nifty 50 Feb closed at 21895, down 308.05 points; 56.15-point discount to spot index
–Nifty 50 Mar closed at 22046.95, down 301.90 points; 95.80-point premium to spot index
–Nifty 50 Apr closed at 22190, down 298.55 points; 238.85-point premium to spot index
HDFC Bank, Reliance Industries, Tata Motors, State Bank of India, ICICI Bank, Vodafone Idea, Axis Bank, Kotak Mahindra Bank, Adani Ports And Special Economic Zone, Bajaj Finance, Hindustan Aeronautics, and Larsen & Toubro were the most actively traded underlying stocks today. End
Edited by Aditya Sakorkar
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