Daily Nifty and Bank Nifty Analysis based on OI and Change in OI for 30th March 2020
On last Friday, both the indices opened with a gap and witnessed some buying till the RBI Governor’s Conference did not hit the air. The RBI Governor Shaktikanta Das ceased from making projections for growth and inflation in his media address, where he announced a slew of measures to support the economy, including a whopping 75 basis points cut in repo rate. Though, he has taken good steps however, the market reacted on Covid19 and results in both the indices closed almost flat and lost entire gains.
Now, we will do Nifty and Bank Nifty analysis based on Open Interest, Change in Open Interest, India Vix and Trend Cycles for 30th March 2020.
Bank Nifty Option Front
Bank Nifty has given closing at 19969.0 on spot on 27th March 2020. On the options front, maximum Put open interest was at 17,000 followed by 19,000 levels, while maximum Call OI was at 22,000 followed by 23,000 levels. OI positions are scattered at various strike rates, indicates the volatility can remain in the market. On 20000 strike, both the call and put writing have been seen.
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. Trading seems to be 18000 to 21000.
1. Highest Call at 22,000.
2. Highest Put at 17,000.
3. Pivot Level at 20,000.
Highest call acts as the highest resistance and highest put acts as the highest support for the Nifty and bank nifty. Pivot level is the level that bulls and bears don’t want to let it go easily. Tug of the war goes around the pivot level between bulls and bears generally.
Trading Range Of Nifty
Nifty has given closing at 8660.25 at spot on 27th March, 2020. On the options front, maximum Call OI was at 10,000 and then 9500 levels while maximum Put OI was at 8,000 and then 8,500 levels.
Options OI data lay scattered at various strike prices, indicate the volatility.
1. Highest Call at 10000.
2. Highest Put at 8,500.
3. Pivot Level at 8500.
3. Pivot Level at 8500.
India Vix
India VIX closed at 70.38 level with 1.6% fall. A higher VIX beyond 70 level suggested that volatile swings could continue in the market. Volatility has to cool down from current multi-year-high levels and only then the Indian market could see stability and have a smooth ride. However, Volatility has been started cooling from higher levels.
It is sustaining above the maximum on Box Plot into outlier data on the daily scale and thus volatile swings may continue in the coming days. If you wonder what Box Plot is and how it works, you can check here details.
Nifty and Bank Nifty Trend Cycles
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| Bank Nifty Trend Cycles |
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| Nifty Trend Cycles |
Conclusion:
The OI scattered here and there that indicates volatility will be there in the market. Some cooling has been seen today in VIX, if VIX continues to cool down, it will help the market to form a bottom. On Trend cycles, some positive cycles are started appearing, this is also an indication of good sign to market recover. However, volatility is still high in the market.
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.
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