Summary Report: Open Interest, Option Chain and FII/DII Activity in Nifty 50 for the Week Ending May 15th, 2020

2 min read

By Ashutosh Dave

Price-Volume Analysis

The market showed some promise in the middle of the week reaching and hitting the 9400 levels and then erasing all the gains and more in the last two days of the week.

The volumes also suffered towards the end of the week after the bump in the middle of the week. This indicates a lack of momentum going into the next week.

Open Interest Analysis

The combined open interest in all the three futures increased steadily throughout the week as the prices struggled to hold, indicating a building up of positions on the short side.

Option Chain Analysis

After the expiry of weekly option on the 14th of May, significant open interest was built-up in the 9400 and 9500 call options for the Nifty option expiring on the 21st of May.

Thus, 9400 and 9500 present strong short term resistance to an upward move in Nifty. Similarly, significant open interest was built-up in the 9000 put options which is the short term support level going into the new week.

FII/DII Analysis

The overall interest of DII remained on the long side but at low levels. Also, unlike the last week, the FIIs remained net sellers.

This is a bearish indication for the markets as we head into the new week, as the institutional investors showed a poor response to the economic package announced by the Government.

For the research methodology and more information on Nifty 50 futures refer to this earlier blog on QuantInsti portal.

Disclaimer: All investments and trading in the stock market involve risk. Any decisions to place trades in the financial markets, including trading in stock or options or other financial instruments is a personal decision that should only be made after thorough research, including a personal risk and financial assessment and the engagement of professional assistance to the extent you believe necessary. The trading strategies or related information mentioned in this article is for informational purposes only.

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