| Healthcare, oil & gas, PSU and bank stocks came under selling pressure. Buying interest was visible in the FMCG stocks. |
| As observed from the open interest in the Nifty put and call options, this column had stated that the Nifty will have steep resistance at 4,200 levels and strong support at 4,100 levels. |
| The gap-up opening and piercing of 4,200 levels provided an incentive for going short. The short covering in the afternoon trade was done when the Nifty August futures breached the support levels of 4,100, which is why the Nifty August futures bounced back from 4081 levels to close above the support level of 4114. |
| Derivative data show that there has been a consistent fall in open interest positions. The open interest in the index and stocks futures declined further by nearly Rs 5,000 crore at Rs 50,000 crore. Markets analysts said that the decline in the open interest has largely been triggered by bull operators who have covered their long positions. |
| The put/call ratio (PCR) of the Nifty open interest declined marginally from 1.17 to 1.16 on Thursday. When the ratio gets too low, it indicates that the call volume is high relative to the put volume and when the ratio gets too high, it indicates that the put volume is high relative to the call volume. |
| Traders look to sell when the ratio gets too low and the market is extremely bullish. They look to buy when the ratio is too high and the market is extremely bearish. |
| The support levels on the basis of the open interest in Nifty put options continued to be around 4,100 levels as open interest is being added at 4,100 levels. |
| The resistance continued to be at 4,200 levels as open interest getting added at 4,200 levels. With the Nifty hovering at around 4100-4250 in the past few trading days, the open interest in put and call options at strike prices of 4,300, 4,400, 4,500 and 4,600 is getting covered. |
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