Note on F&O Expiry

0
104
Sun Pharma shares crash after whistleblower email to Sebi

“Nifty index remained highly volatile in the October series as it moved in a wider range of 850 points. It fell down in the first week of the series but witnessed strong recovery from 11090 to 11945 zones in last four weeks by strong buying in many heavyweights counters. It has been making higher highs – higher lows on weekly scale and managed to surpass its key hurdle of 11700 zones. It has shifted its support base from 11100 to 11500 and now at 11700 zones. India VIX comparatively remained at higher zones near to 16-18 marks and reason being volatile swing was seen in the Indian indices even after the overall positive bias.

Bank Nifty underperformed the Nifty index in this series as it closed on flattish note on expiry to expiry basis near to 30000 zones. (Bank Nifty settled at 30066 in October series while at 30002 in September series). Nifty index closed with the gains of 2.65% on expiry to expiry basis as it settled at 11877 compared to September series closing of 11571 marks. Even after the sharp cut in INFY, Nifty managed to hold its gains because of the Reliance, TCS, Hindunilvr, few Private Banks, most of Auto stocks etc.

On the option front, as per the early data, maximum Put OI is at 11600 while meaning Call OI is at 12000 strike. Option band signifies an immediate trading range in between 11600 to 12000-12100 zones.

Index has shifted its support to higher zones and now till it holds above 11700 zones, we are expecting it to head towards its life time high of 12103 marks while Bank Nifty has been underperforming the Nifty index and needs to hold above 29750 zones to head towards next hurdle of 30800 zones. Selective FMCG, Auto, Insurance and Private Banks could see the positive price action in the November series.

(- By Chandan Taparia, Equity Derivatives & Technicals, Analyst on F&O Expiry, Motilal Oswal Financial Services Ltd.)