Ripples Advisory, Bank Nifty Put options see surge in open interest
Bank Nifty index climbed to a new high of 27,164 on Thursday due to foreign fund inflows and strengthening of rupee against the dollar. Bank Nifty June futures contract zoomed 213.55 points to 26,995. The underlying value of the contract closed at 27,026.55.
Active call options of July 19 expiry
Among the call option chain, the In-The-Money Bank Nifty Call 26,900 option was the actively traded contract on Thursday. The option price gained 76.35 per cent to close at Rs 239.75. However, OI in the contract shed 15.70 per cent. This confirms that traders are pruning their positions in the contract despite an increase in the option price.
There was also a lesser demand for the option as the implied volatility is comparatively lower at 8.87 per cent. It is an indication that the Bank Nifty may encounter stiff resistance around 27,200 levels in the short-term.
The Bank Nifty Call 27,200 option contract is currently an Out-Of-The-Money option. The option price rose 106.45 per cent to Rs 102.50. OI in the contract surged 272.85 per cent with the IV at 10.40 per cent that indicates strong buying interest in the strike price. The Bank Nifty index is likely to face resistance at 27,200-27,250 levels in case of the further upward move.
Active put options of July 19 expiry
On the put option chain, the In-The-Money Bank Nifty Put 27,100 option contract saw a huge increase in the open interest. The put option price closed down 38.85 per cent at Rs 227.20 whereas the OI zoomed 7,063 per cent.
The implied volatility was comparatively higher at 12.75 per cent. This confirms that the underlying Bank Nifty may get support around 26,800-26,900 levels in case correction happens.
The Out-Of-The-Money Bank Nifty Put 26,800 contract was the most actively traded contract. This put option price declined 52 per cent to Rs 92, while the OI climbed 591 per cent. The option price has turned costlier with the implied volatility at 13.50 per cent. This indicates that the Bank Nifty is likely to get traction around 26,800 levels in this expiry.
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