Weekly F&O Expiry: Traders expect Nifty to hold 18,800, shows option data

Meanwhile, the Bank Nifty seems broadly trapped in the 43,500 - 44,000 range, say analyst.

NIFTY

Bias: Positive

Put-Call Ratio (PCR): 1.1

Support: 18,780

Resistance: 18,930

Since the start of the week, the NSE Nifty 50 has been within a striking distance of its record peak at 18,887.60. The feat has, however, eluded traders so far even as the Sensex notched a fresh summit in trades on Wednesday.

Meanwhile, based on the Nifty options open interest (OI) for the weekly expiry, the bulls seem confident of a new peak being registered sooner rather than later. The PCR (Put Call Ratio) for today's (weekly Thursday) expiry stands at 1.1; indicating presence of higher OI in Nifty Puts when compared with Calls.

The highest OI among Nifty Puts is observed at 18,800 Strike Price followed by 18,700 and 18,500. Further, the 18,800 and 18,850 Puts saw significant build-up in OI on Wednesday, signifying that traders expect the Nifty to not dip much below the 18,800 level in the near-term.

Based on the OI and premium value, the NSE Nifty 50 is expected to get considerable support around 18,780 level in today's trading session. However, if the Nifty fails to hold the support, then the NSE benchmark could weaken further towards the 18,700 level.

On the other hand, the highest OI among Calls is seen at 19,000 Strike Price followed by 18,900. The OI and premium value suggests that the Nifty could face resistance around 18,930 on the upside.

"The Nifty has made a Doji candle on the daily chart which signals indecision. Hence Wednesday's high of 18,876 and the day's low of 18,795 will act as resistance and support for Nifty respectively. A close below the Doji candle low can lead to profit booking while a close above the Doji candle high can lead to creation of fresh longs," said Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities in a note.

"The Open Interest (OI) data of the last two trading sessions indicates that there is a short covering happening in Index futures. The Long-short ratio of Foreign Portfolio Investors (FPIs) has been above the 50 per cent mark since June 13,  indicating that the FPIs hold more long positions relative to short positions," Ashwin added.

BANK NIFTY

Bias: Range-bound

PCR: 0.92

Support: 43,650; 43,475

Resistance: 44,080

The Bank Nifty hit a new all-time high in late May, and has corrected thereafter. It has been consolidating within the 43,400 - 44,050 range since the last five trading sessions.

Technically, the Bank Nifty is seen facing resistance around its 20-DMA (Daily Moving Average) at 43,975 level, and seeking support around its 50-DMA at 43,420.

Similarly, the highest OI among Bank Nifty Calls is seen at 44,000, whereas the highest OI in Puts is at the 43,500 Strike Price.

Based on the OI and premium value, the Bank Nifty is expected to face resistance around 44,080 on the upside, and may seek support around the 43,650 on the downside, below which the major support lies at 43,475.

"The Bank NIFTY index is currently witnessing a continued battle between the bulls and the bears. It has a support level at 43,500, which is indicated by the presence of maximum put writing. On the other hand, there is resistance at 44,000, where the highest open interest is seen on the call side. A break on either side of this range is expected to result in trending moves. Within the range, it is advisable to adopt a buy-on-dip approach," said Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities in a note.