Bank Nifty and Nifty analysis based on OI for 20th Feb 2020

Due strong buying interest at lower levels, the bank nifty and nifty run for the bulls today. How do they perform in tomorrow session? We will try to find out by analyzing the open interest, change in open interest and Trend Cycles.

Bank Nifty Option Front

Bank Nifty has given closing at 30838.2 on spot on 19th Feb 2020. On the options front, maximum Put open interest was at 30,500 followed by 30,000 levels, while maximum Call OI was at 31,000 followed by 31,500 levels. The major addition in the put has been seen at 30700 and 30800, in Call side major unwinding has been seen at 30700, 30600 and 30500.

Bank Nifty Option Chain

Trading Range Of Bank Nifty

Now time to find out the trading range of the bank nifty. For this purpose, we need to look for the highest call OI Row and Highest Put OI Row on the option chain of the Bank Nifty. Options data indicated a trading range between 30,500 and 31,500 levels.

1. Highest Call at 31,500. 

2. Highest Put at 30,500. 

3. Pivot Strike at 31,000.

Highest call acts as the highest resistance and highest put will act as the highest support for the Nifty and bank nifty.

Trading Range Of Nifty

On the options front, maximum Put open interest was at 12,100 followed by 12,000 strikes while maximum Call OI stood at 12,300 followed by 12,500 strikes. We have seen meaningful Put Writing at 12,100 followed by 12,000 strikes while Call Unwinding was seen at all the immediate strikes. Option data indicates the trading range between 11,900 and 12,200 levels.

Nifty Option Chain

1. Highest Call at 12,200. 

2. Highest Put at 12100. 
3. Pivot Level at 12100.

Trend Cycles of Nifty and Bank Nifty

Bank Nifty Trend Cycles

Nifty Trend Cycles

Conclusion:

The major addition in the put and major unwinding in calls indicates bullishness of the market. Tomorrow is weekly expiry so we have to ready for the volatility.

In the trend cycle, Bank Nifty has witnessed short cover -long unwinding cycles however nifty also has short-cover-short-long unwinding cycles from the last two days. This is an indication of mild bearishness of the market. This indicates mild bullish.

Disclaimer: The analysis has been prepared for informational and educational purposes only. It is not and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.