Bank Nifty and Nifty Analysis based on OI for 26th Feb 2020

Market opens with gap up but failed to capitalize the momentum. And selling trades griped the market in initial trades. Most of the time both indices consolidated and finally Nifty gave a close below the pivot level 11800. Now we will check what it has kept secret for tomorrow with the help of Open Interest Data and Trend Cycles.

Bank Nifty Option Front

Bank Nifty has given closing at 30432.7 on spot on 25th Feb 2020. On the options front, maximum Put open interest was at 30,000 followed by 30,500 levels, while maximum Call OI was at 31,000 followed by 30,500 levels. Minor addition in put has been seen at 30400 and 30000, in Call side major addition has been seen at 30500, 30600 and 30700.

 

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 30,000 and 31,000 levels.

1. Highest Call at 31,000. 

2. Highest Put at 30,000. 

3. Pivot Strike at 31,500.

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

Nifty has given closing at 11829.4 at spot on 25th Feb, 2020. On the options front, maximum Put open interest stood at 11,800 followed by 11,700 levels, while maximum Call open interest was at 12,000 followed by 12,200 levels. There was significant Call writing at strike prices 11,900 to 12,200 while Put unwinding was seen at all immediate strike prices and minor Put writing is seen at 11,800. Options data indicated a shift in the lower trading range to 11,700-12,050 zone.

Nifty Option Chain

1. Highest Call at 12,000. 

2. Highest Put at 11800. 
3. Pivot Level at 11800.

Trend Cycles of Nifty and Bank Nifty

Bank Nifty Trend Cycles

Nifty Trend Cycles

Conclusion:

On option chain data, both nifty and bank nifty looks range bound bearish sentiment.

In trend cycle, Bank Nifty has witnessed Short cover -short cycles however nifty has short-long unwinding cycles from last two days. This indicates the confused trend. So, need to be little careful.

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.