Market watch: What does the F&O market suggest about trade on Feb-02?

Max pain at the end of today's trade stand at 17500

The Finance Minister of India presented FY23 Union Budget, with clear focus on capital expenditure.  As expected, market witnessed high volatility reflected in the movement of Nifty 50 swinging between gains and losses. Nonetheless, it was not reflected in the Nifty VIX movement, which cooled off by nine per cent and closed below 20 at 19.98. Nifty closed with gains of 237 points at 17,577. 

Activity on the F&O front for weekly expiry on 03-Feb-2022 shows 18000 to act as a strong resistance now. Highest open interest contract of 154103 stood at this strike price. The second-highest call option open interest 144523 for Nifty 50 stood at a strike price of 18500. In terms of the highest addition of open interest in the call options front, it was at 18200 in the last trading session. A total of 78188 open interest was added at this strike price.

In terms of put activity, the highest put writing was seen at a strike price of 16500, where  57496 open interest added on (01-Feb-2022), followed by 17000 where (54551) open interest added on 01-Feb-2022. Highest total put open interest of 108291 stood at a strike price of 16500. This is followed by a strike price of 17000, which saw a total put option open interest of 100478 contracts.

The Nifty 50 put call ratio (PCR) closed at 0.76 for the day. A PCR above 1 is considered bullish while a PCR below 1 is considered bearish. 

Max pain at the end of today's trade stand at 17500.