Futures & Options (F&O) Insights for Tuesday, November 19: The NSE
Nifty 50 index may aim to reverse its 7-day losing streak amid positive cues from global peers. Over the last few days, FIIs (foreign institutional investors) selling in the cash market has reduced, while they were net buyers in the F&O segment on Monday.
For the records, the Nifty 50 index has ended below the 200-DMA for the second straight day on Monday.
Technically, on a daily scale the Nifty has formed a red candle yesterday, indicating weakness. Furthermore, the Nifty has decisively broken its 200-day exponential moving average (DEMA) support level of roughly 23,540. Thus, 23,540 - 23,550 will serve as an immediate barrier for the Nifty, says Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates.
On the downside, 50-Weekly Simple moving average (WSMA) is placed near 23,300 levels, which will serve as short term support. Overall, the short-term trend is down, but we expect Nifty to consolidate in the narrow band of 23,300 - 23,600, Hrishikesh said in a note.
In the case of Bank Nifty, the index has formed a small green candle and successfully defended the 200-day exponential moving average (DEMA), indicating strength. The 200-DEMA support is placed near 49,910. If index manages to respect 49,900, then it could witness pullback move towards 50,500 - 50,600 levels, the analyst said.
Key Insights from Nifty, Bank Nifty options data In the Nifty options market, there is a significant concentration of open interest (OI) at the 23,500 - 24,000 Call and 23,500 - 23,000 Put levels. The Nifty Put-Call Ratio stands at 0.71, reflecting a cautious market sentiment, said Sahaj Agarwal, Senior Vice President, Head of Derivatives Research at Kotak Securities.
Weakness persists from a medium-term perspective as well as on a momentum basis for the markets. Immediate weekly resistance for Nifty is seen at 23,900, below which the bias remains negative for the near term, Sahaj said.
The concentration of active positions in the 23,500 – 23,900 Call zone and the 23,100–23,400 Put range reinforces the resistance at 24,000 and support near 23,000. Rising Call-writing across the 23,500 – 24,000 range underscores seller dominance, while diminishing Put-writing activity reflects cautious sentiment, explains Dhupesh Dhameja, Derivatives Analyst at SAMCO Securities.
In the case of Bank Nifty, the options data reveals a bearish undertone. The PCR edged lower to 0.94 from 0.96, indicating a defensive stance as sellers maintain their grip. The max pain level stands at 51,000, Dhupesh added.
FII v/s Retail v/s Proprietary traders: Who is bullish/ bearish? Foreign institutional investors (FIIs) were net buyers of 3,458 contracts of index futures for Rs 352.33 crore on Monday. FIIs net bought 8,991 contracts of Bank Nifty futures to the tune of Rs 679.05 crore; while net sold 4,687 contracts of Nifty futures worth Rs 275.24 crore and 762 contracts of MidCap Nifty futures for Rs 46.08 crore.
The NSE F&O data shows that FIIs open interest (OI) in Nifty futures rose by 1.9 per cent to 1.86 lakh contracts. The OI in Bank Nifty futures too increased by 1.9 per cent, while in the case of MidCap Nifty futures the OI dipped by 0.7 per cent.
Pursuant to which, FIIs long-short ratio in index futures inched a wee bit higher to 0.31 - this ratio, however, still implies that foreign investors hold 3 short bets in index futures for every bullish position.
On similar lines, proprietary traders too are seen holding 2 short positions for every long bet in index futures.
However, retail investors' long-short ratio rose by 6 basis points (bps) to 2.18 - implying presence of more than 2 long positions in index futures for every bearish bet.
Stocks in F&O ban period today, November 19 Aarti Industries, Aditya Birla Fashion Retail, GNFC, Granules India and Hindustan Copper are the 5 stocks placed under F&O ban period on Tuesday.
 "Can Nifty snap its 7-day losing streak today? Here's what F&O data suggests")
