Nifty and Bank Nifty Analysis for 1st June 2020
Index futures and stock futures across the band of the FO are trading at a discount to spot prices. The nifty future can be seen with the discount of 100 points, which is an unusual event. We have the highest call open interest at 9500 even though Nifty has traded above this level.
Friday, indices are opened at the negative note and recovered latter and finally closed in the green zone.
Let’s check the data and do the analysis for Bank Nifty and Nifty for 1st 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 19297.25 on spot on 29th May 2020. On the options front, maximum Put open interest was at 18,000 followed by 18500 levels, while maximum Call OI was at 20,000 followed by 19,500 levels. The OI positions are scattered at various strike rates, indicates the volatility can remain in the market. A good call addition and put 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 18500 to 20000.
1. Highest Call at 20,000.
2. Highest Put at 18,000.
3. Pivot Level at 19,000.
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 9580.30 at spot on 29th May, 2020. The maximum Call open interest stood at 9,500 and then 9,700 levels while maximum Put OI was at 9,000 and then 9,200 levels. Significant Put writing was seen at 9,400 followed by 9,200 levels, whereas there was a good Call writing at 9,500 followed by 10,000 levels. Options data indicated an immediate trading range between 9,400 and 9,700 levels.
1. Highest Call at 9500.
2. Highest Put at 9,000.
3. Pivot Level at 9500.
3. Pivot Level at 9500.
India Vix
India VIX marginally rose by 0.67% to 30.22 level. 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
|
Max Pain
|
Pre. Max Pain
|
PCR (OI)
|
Bank Nifty
|
19000
|
19000
|
1.37
|
Nifty
|
9450
|
9400
|
1.61
|
Remarks
|
Trend Cycles (EOD)
 |
| Bank Nifty Trend Cycles |
 |
| Nifty Trend Cycles |
Conclusion
The Pivot level in Bank Nifty and Nifty shifted up, indicates some positivity in it. The Max Pain for both the indices also shifted higher. On the data front, Put writers look stronger.
Bank Nifty is still not showing any strength. The trend cycles suggest short-cover and long unwinding cycles. However, Nifty is showing little strength. So, We need to see, if nifty drags bank nifty higher or bank nifty pulls down Nifty.
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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