Market watch: What does the F&O market suggest about trade on January 06?

The Nifty 50 put call ratio (PCR) closed at 1.48 for the day.

The Nifty 50 claimed 17900 in today’s trading session. After opening flat it dipped below 17750 for a brief period. Nevertheless, it resumed its gain and crossed the 17,900 mark and finally ended the session with gains of around 120 points at 17,925 levels. Indian equity market outperformed its global peers. Global markets remained on a subdued note as US Treasury yields rose higher and hence IT stocks were laagered in today’s trading session. Most Asian markets closed in red while Europe is trading in green. Even the Nifty VIX gained 6.87 per cent to close at 17.23. 

Activity on the F&O front for weekly expiry on January 6 shows 18000 to act as a strong resistance now. Highest open interest contract of 138883 stood at this strike price. The second-highest call option open interest 116768 for Nifty 50 stood at a strike price of 18100. In terms of the highest addition of open interest in the call options front, it was at 18100 in the last trading session. A total of 97730 open interest was added at this strike price.

In terms of put activity, the highest put writing was seen at a strike price of 17800 (117564 open interest added on 05-Jan-2022), followed by 17700 where (93599) open interest was added on January 5. Highest total put open interest (118419) stood at a strike price of 17800. This is followed by a strike price of 17000, which saw a total put option open interest of 114333 contracts. 

The Nifty 50 put call ratio (PCR) closed at 1.48 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 17850.