Weekly View of the Market
Nifty is consolidating in the band of 9550-9700 levels. But in recent consolidation, we have not seen any major addition and shedding of open interest. However, options players were active throughout consolidation selling both calls and puts. This data indicates more consolidation to continue. There is maximum call open interest concentrations at 9700 calls indicating strong resistance and support around 9500 as put writers are holding put sell position of those levels. Data indicates some more consolidation or minor dip to around 9550 levels. However, if we get any dip we should initiate fresh long position with the support around 9500 levels. The Implied Volatility (IV) of calls was up and closed at 9.78% while that for put options closed at 9.99%. The Nifty VIX for the week closed at 11.21% and is expected to remain sideways. Among Nifty Call options 9700-strike call has the highest open interest of above 80 lakh shares. On put side; 9500-strike put has the highest open interest of over 55 lakh shares in open interest respectively. The PCR for the week closed up at 1.11 which indicates OTM put writing. The current trend is likely to continue towards 9700-9725 after some consolidation.
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