The Indian benchmark was opened on a flat note at 11,908.30 levels and continued to trade lackluster in a narrow range of 11,881.4-11,946.30 levels. However, market veterans were betting for a bounce back from the psychological support of 11,900 levels but higher build up in Call Writing triggered the sellers for short formations and index closed near 11,830 levels. All indices closed in red out of which the PSU banks that erased 3.14%.
Maximum Call open interest (OI) of 39.81 lakh contracts was seen at the 12000 strike price followed by 11900-strike price which 26.51 Lakhs. Highest call writing was seen at strike price of 12000, at which 14.61 lakh contracts traded. Call option suggest 11930 will be next hurdle. Maximum Put open interest of 18.16-lakh contract was seen at the 11800-Strike price followed by 11700 levels with 14.48 lakh open contracts. Highest put writing was seen at a strike price of 11750 at which total 1.25 lakh contracts traded. Put option suggest 11750 will act as a support.
Nifty50 futures is likely to remain in a range of 11,761.17 -11,962.83 levels as per the daily volatility of 0.85 levels. Breakout of ‘Head and Shoulder’ pattern on hourly scale, closure below 10 days Exponential Moving Average and heavy additions in Call writing at 11,900 levels is likely to keep the investors on tenterhooks. Traders should avoid long positions now and execute short positions near 11,900 levels to a low of 11,800 levels.