F&O Action: Futures and Options market cues for January 21

Activity in the F&O market for the weekly expiry on January 27 shows 18000 to act as a key level to watch.

Taking cues from a weak handover from the US market, the Indian equity market also opened in red. Nevertheless, in a volatile market it kept on losing and the Nifty index at one point of time went below 17,650. It was only due to the last 45 minutes of recovery that helped the market to close above 17,750. Despite such a fall in the Nifty 50, Nifty VIX cooled off and closed at 17.79 down by 0.15 per cent from yesterday’s close. 

Activity on the F&O front for weekly expiry on January 27 shows 18000 to act as a strong resistance now. Highest open interest contract of 153342 stood at this strike price. The second-highest call option open interest 136418 for Nifty 50 stood at a strike price of 19000. In terms of the highest addition of open interest in the call options front, it was at 19000 in the last trading session. A total of 103770 open interest was added at this strike price.

In terms of put activity, the highest put writing was seen at a strike price of 18000 (27528) open interest added on January 20, followed by 16000 where (24964) open interest was added. Highest total put open interest (84665) stood at a strike price of 18000. This is followed by a strike price of 17000, which saw a total put option open interest of 80162 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 stands at 17900.