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Bank Nifty index had ended slightly lower as key banking stocks turned weak in Tuesday’s volatile session. Bank Nifty July futures contract touched an intraday high of 27,173 before closing at 27,016, down by 56.90 points. The underlying value of the contract closed at 26,974.40.
Active call options of July 26 expiry
Among the call option chain, the In-The-Money Bank Nifty Call 26,700 option was the actively traded contract on Tuesday. The option price declined 15.15 per cent to Rs 343.90. However, open interest in the contract was down by 24.15 per cent.
This confirms that traders have pruned some of their positions in the contract ahead of the expiry. The implied volatility of the option price was comparatively higher at 20.10 per cent. It signifies that the Bank Nifty is likely to face resistance around 27,100 levels in the expiry.
The Bank Nifty Call 27,200 option contract is currently an Out-of-The-Money option. The option price had ended down 38.40 per cent at Rs 56.10 on Tuesday. There was an addition of OI to an extent of 84 per cent.
The implied volatility was seen higher at 17 per cent that indicates there was good demand for the contract. Hence, the Bank Nifty may encounter resistance around 27,250 levels.
Active put options of July 26 expiry
On the put option chain, the In-The-Money Bank Nifty Put 27,100 option contract was the actively traded one on Tuesday. The put option price had closed up 2.70 per cent at Rs 157.05. OI too climbed 211.35 per cent.
The implied volatility was comparatively lower at 11.40 per cent. This underscores that the Bank Nifty is likely to find support at 26,900 levels.
The Out-Of-The-Money Bank Nifty Put 26,700 contract saw maximum reduction in OI. This put option price had ended down 19.15 per cent at Rs 30.80 and the OI too was down 22.50 per cent.
The implied volatility of the option price was at 15.90 per cent. This indicates that the Bank Nifty is likely to get support around 26,700 levels in case of further downside.
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