Nifty and Bank Nifty Analysis for 16th June 2020
Nifty and Bank Nifty opened gap down and started correcting from the first tick. The first half of the session was dominated by bears but the second half showed a good recovery as some fresh was noticed over there.
Let’s check the data and do the analysis for Bank Nifty and Nifty for 16th June 2020 based on Open Interest, Change in OI, PCR, Max pain and Trend Cycles.
Bank Nifty Option Front
Bank Nifty has given closing at 19912.90 on spot on 15th June 2020. On the options front, maximum Put open interest was at 19,000 followed by 18,500 levels, while maximum Call OI was at 21,000 followed by 22,000 levels. The OI positions are scattered at various strike rates, indicates the volatility can remain in the market. A good call addition has been seen around the ATM strike.
Trading Range Of Bank Nifty
Now time to find out the trading range of the bank nifty. Trading Range is a general range between the highest call strike and highest put strike. To find the range, we need to look for the highest call OI Row and Highest Put OI Row on the option chain of the Bank Nifty. Trading range seems to be 19000 to 21000.
1. Highest Call at 21,000.
2. Highest Put at 19,000.
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 9813.7 at spot on 15th June, 2020. The maximum Call open interest stood at 10,000 and then 10,500 levels while maximum Put OI was at 9,000 and then 9,300 levels. Significant call writing was seen at 10,000 followed by 9,900 levels, whereas a good addition of the put has been seen at 9700. Options data indicated an immediate trading range between 9700 and 10,000 levels.
1. Highest Call at 10000.
2. Highest Put at 9,000.
3. Pivot Level at 9,800.
3. Pivot Level at 9,800.
India Vix
India VIX moved up 5.68 per cent to 32.58 level. Any further rise in the volatility index may result in a roller-coaster move for the market. 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.
Derivative Data
Symbol
|
Pre. Max Pain
|
PCR (OI)
| |
Bank Nifty
|
20000
|
20500
|
0.86
|
Nifty
|
9800
|
9900
|
1.34
|
Remarks
| |||
Trend Cycles (EOD)
 |
| Bank Nifty Trend Cycles |
 |
| Nifty Trend Cycles |
Conclusion
Pivot strike has been shifted down and max pain level also shifted down, shows weakness in the indices. On OI, call writers look at the driving seat. Bank nifty moves in long-long unwinding cycles whereas Nifty moves in Short cover - unwinding cycles. Nifty shows weakness wheres as Bank nifty shows little strength. Overall sentiment seems to be negative.
Open Interest Images are generated by the Telegram Bot: OIinAction. You can also join it and can generate OI images for free.
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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