F&O Market Watch: What does the Futures and Options Market suggest about trade on February 28?

The Nifty 50 put call ratio (PCR) closed at 0.53 for the day.

Nifty saw a significant short-buildup on Monday, where price slipped by 1.38 per cent and OI increased by 17.34 per cent, as Nifty Bank created a significant short-build up, tumbled by 1.74 per cent and OI increased by 9.35 per cent.

Nifty

Nifty Bank

The Nifty 50 put call ratio (PCR) closed at 0.53 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 for weekly expiry on February 29 stands at 22000.

Call Options Data

In the weekly options data analysis, the 22000 strike emerges as a significant resistance level for the Nifty in the short term, boasting the highest Call open interest at 3,25,888 contracts. This level is crucial for traders to monitor. Subsequently, the 23000 strike holds notable open interest with 2,84,595 contracts, while the 22500 strike follows closely with 2,82,191 contracts.

Observing Call writing activities, there is substantial activity at the 22200 strike, evidenced by the addition of 1,76,883 contracts. Additionally, the 22100 and 22000 strikes witness meaningful Call writing, accumulating 1,52,458 and 1,35,045 contracts, respectively. These levels suggest potential resistance zones.

On the other hand, notable Call unwinding is observed at the 22800 strike, shedding 26,473 contracts. The 22750 and 22850 strikes also experience significant Call unwinding, relinquishing 17,796 and 15,412 contracts, respectively. This unwinding could indicate a weakening of resistance at these levels.

Put Options Data

In the options market for Nifty, notable open interest on the Put side is concentrated at the 21500 strike, making it a crucial support level, evidenced by 1,90,830 contracts. The subsequent significant support areas include the 21000 strike with 1,27,933 contracts and the 18650 strike with 1,26,580 contracts.

There was substantial Put writing at the 21800 strike, where 81,051 contracts were added. Additionally, meaningful Put writing activity was observed at the 21550 and 18650 strikes, contributing 18,330 and 13,496 contracts, respectively.

Conversely, Put unwinding took place at the 22100 strike, witnessing a reduction of 60,207 contracts. The 22000 strike and 22200 strike also experienced Put unwinding 57,431 and 51,105 contracts, respectively.

Long build-up Stocks

Following scrips were among stocks that had a long build-up. A rise in open interest (OI) and price suggests a concentration of long holdings.

Short build-up Stocks

A short build-up was seen in these stocks. An increase in OI along with a fall in price points to a build-up of short positions.

Disclaimer: The article is for informational purposes only and not investment advice.