Comments
Bank Nifty index plummeted on Monday as the domestic sentiment was hit by the news that the WPI inflation rose to a 54-month high in June amid the country’s widening trade deficit.
Bank Nifty June futures contract ended down by 239 points at 26,724 while the underlying value of the contract closed at 26,679.80.
Active Call Options of July 19 expiry
Among the call option chain, the In-The-Money Bank Nifty Call 26,600 option was the actively traded contract. The option price closed down 51.75 per cent at Rs 196.25. However, the OI in the contract zoomed 305.60 per cent which confirms that traders have taken fresh positions in the contract.
The implied volatility was higher at 14.50 per cent. It is an indication that the underlying Bank Nifty is likely to face a strong resistance around 26,800 levels in case the underlying reverses direction.
Bank Nifty Call 26,800 option contract is currently an Out-Of-The-Money option. The option price declined 62.45 per cent to Rs 96.55. However, OI surged 370.80 per cent with the IV at 14.50 per cent.
Traders have taken fresh long positions in this contract with the option price turning cheaper. Hence, the underlying Bank Nifty may encounter resistance around 26,800-26,850 levels in case of any volatility before the expiry.
Active Put Options of July 19 expiry
On the put option chain, the In-The-Money Bank Nifty Put 26,800 option contract saw maximum pruning of contract positions ahead of this weekly expiry. OI sharply declined by 49.75 per cent, while the put option price closed higher by 90.60 per cent at Rs 165.
The implied volatility of the option price was relatively lower at 11.27 per cent. This confirms that the underlying Bank Nifty may decline below 26,600 levels before the expiry.
The Out-Of-The-Money Bank Nifty Put 26,400 contract saw significant buying interest in Monday’s trading session. This put option price gained 61 per cent to Rs 33.
OI increased by 57.10 per cent. The implied volatility of the option price was relatively higher at 13.85 per cent indicating that the underlying is likely to get support around 26,400 levels.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.