What do option data say about L&T Finance Holdings?

On Tuesday, the stock of L&T Finance Holdings Limited has opened with an upside gap and marked the high of Rs 108.10. In the second half of the trading session, the stock slid into a consolidation along with low volume. In the end, the stock has settled with gains of 7.58 per cent at Rs 107.10.  

January series stock future of L&T Finance Holdings Limited saw short-covering as the open interest has fallen by 7.09 per cent. The short-covering happens when the price is going up but the open interest is falling. January month’s current open interest is 2,78,46,500.  

For January expiry, the open interest wise put-call ratio (PCR) is at 0.39. PCR below one is suggesting that the investors are purchasing more call options than the put options. This signals that the investors are speculating a bullish trend, going forward.   

For January series, the highest call open interest is at 110 strikes with 1,32,21,900 OI. On the put side, the highest put open interest is at 100 strikes with 30,04,600 OI. Today, the highest addition in the open interest was seen at 110 calls of January expiry with 46,89,500 OI while on the put side, 100 puts have seen the highest addition in the open interest with 5,39,500 OI. For January expiry, the total call open interest is 3,84,45,600 while the put open interest is 1,48,73,600. The current derivative data suggest that Max Pain is at 100 for the monthly expiry.  

Going ahead, the level of Rs 110 will act as a major resistance for the stock as calls of 110 strikes of January expiry has seen the highest open interest and today also, there is a significant addition of open interest in the same strike. On the downside, the level of Rs 100 will act as crucial support for the stock.