Benchmark indices managed to eke out minor gains in an otherwise volatile session to end higher on March 27. Easing concerns over the crisis in the global banking sector and bargain buying due to the recent correction helped trigger gains in today's session. Thanks to that, the Nifty settled the session up 40.70 points, or 0.24 percent, at 16,985.70. Despite the slight recovery, analysts are not confident over the sustenance of the upward momentum and hence suggest investors to follow a sell on rise sentiment. (The blue bars show volume and the golden open interest).
2/5
On the options front, maximum put as well as call writing was seen at 17,000. This suggests that traders do not see much downside from current levels, but the upside also seems limited. "Traders are not yet expecting the fall to be very large below the 17,000 level, as the 17,000 short straddle players have not yet exited their positions or rolled down the strikes to lower straddles," said Rahul Ghose, Founder & CEO – Hedged, an algorithm-powered advisory platform. Ghose feels these- short straddle players will get trapped if the Nifty were to close below the 16,750, triggering another 200 points fall in the index. However, until that happens, he suggested investors to maintain a sideways to bearish view. (The bars reflect changes in OI during the day. The red show call option OI and the green put option OI.)
3/5
Similar to the headline index, put and call writers of Bank Nifty were most active at 39,500, which suggests it will be a key level going forward. Analysts believe the sectoral index is trapped in a broad range of 39,000-40,000 and only a decisive surpassing of either levels can trigger a strong directional momentum for the index. (The bars reflect changes in OI during the day. The red show call option OI and the green put option OI.)
4/5
Index heavyweight Reliance Industries saw a massive buildup of long positions on the back of a rebound in the stock post its recent correction. Open interest in the stock surged 19.4 percent, highest in a year along with strong volumes that were at a one-month high. A long build-up is a bullish sign that happens when open interest and volume increase with the rise in share price. Other stocks that witnessed long buildups were pharma names such as Biocon, Glenmark Pharma, Aurobindo Pharma, Lupin, Alkem Laboratories, and Abbott India. (The bars reflect changes in OI during the day. The red show call option OI and the green put option OI.)
Indian Energy Exchange witnessed strong buildup of short positions as open interest rose 21.1 percent, the highest in a month while the stock price fell to a one-year low in the cash market. Short positions were also added in Tata Power, IRCTC, Ashok Leyland, Bandhan Bank, and IDFC. A short build-up is a bearish sign that takes place when the price of a stock falls, along with high open interest and volume. (The bars reflect changes in OI during the day. The red show call option OI and the green put option OI.) Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. Disclosure: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
![On the options front, maximum put as well as call writing was seen at 17,000. This suggests that traders do not see much downside from current levels, but the upside also seems limited. "Traders are not yet expecting the fall to be very large below the 17,000 level, as the 17,000 short straddle players have not yet exited their positions or rolled down the strikes to lower straddles," said Rahul Ghose, Founder & CEO – Hedged, an algorithm-powered advisory platform. Ghose feels these- short straddle players will get trapped if the Nifty were to close below the 16,750, triggering another 200 points fall in the index, however, until that happens, he suggested investors to maintain a sideways to bearish view. (The bars reflect changes in OI during the day. The red show call option OI and the green put option OI.)](https://images.moneycontrol.com/static-mcnews/2023/03/2-15.png "On the options front, maximum put as well as call writing was seen at 17,000. This suggests that traders do not see much downside from current levels, but the upside also seems limited. "Traders are not yet expecting the fall to be very large below the 17,000 level, as the 17,000 short straddle players have not yet exited their positions or rolled down the strikes to lower straddles," said Rahul Ghose, Founder & CEO – Hedged, an algorithm-powered advisory platform. Ghose feels these- short straddle players will get trapped if the Nifty were to close below the 16,750, triggering another 200 points fall in the index, however, until that happens, he suggested investors to maintain a sideways to bearish view. (The bars reflect changes in OI during the day. The red show call option OI and the green put option OI.)")
