Nifty Open Interest Analysis

[R M]

Many times FII also make use of Option Buying for Hedging their positions that they have taken in Cash Markets so as to mitigate the losses.Hence coupe of times OI can also have mixture of writing+buying.If it would have so easy to determine whether its writing or buying then money making wont be that much tedious job in markets.

Can't say anything about ease of money making but can surely add my two cents on "writing or buying".

Every time an option is written a fresh contract gets added so OI has to go up.

An option may be bought from a writer (OI going up) or from an earlier buyer (OI remains same) or it can be bought back by the writer (OI going down as the contract is extinguished).

So it is safe to say that if OI is going up - it is writing and if OI is going down it is buying. I am afraid that money making still remains difficult.

regards.
rm

 

[Option.Trader]

This is a true horror movie for Bulls... just a look at daily charts shows the immediate cliff points...
1st cliff - 5611 - also 200DMA
2nd cliff - 5540 - minor
3rd cliff - 5200 and finally plunge to 5100

Well we only hope that 5700PE does not have loose motion tomorrow and then all bets are off... let me take a look at OI trade next
Wonder what Sexy trader has to tell?

 

[Option.Trader]

Date : 21.3.2013

5700 still holding fort for Bulls.. but for how long is the $M question... we'll come to know soon if it was a brave decision

It should logically test the 200DMA... bounce back is on cards as per OI data...but will global cues help?

 

[jamit_05]

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Well we only hope that 5700PE does not have loose motion tomorrow and then all bets are off... let me take a look at OI trade next
Wonder what Sexy trader has to tell?

5700 PE let loose 11 L in OI today. It reached almost 92 L intraday and at closing it is only 81 L; This is clear cut weakness. For further affirmations, will wait for sub 70 L levels at closing tomorrow.

 

[SexyTrader]

This is a true horror movie for Bulls... just a look at daily charts shows the immediate cliff points...
1st cliff - 5611 - also 200DMA
2nd cliff - 5540 - minor
3rd cliff - 5200 and finally plunge to 5100

Well we only hope that 5700PE does not have loose motion tomorrow and then all bets are off... let me take a look at OI trade next
Wonder what Sexy trader has to tell?

Things do look that way, but Monday would be a very IMPORTANT day is what I can say!

Monday will tell us if the Bulls really have given up :thumb: For now, buying 5400 PE is sensible hence I did that coz got it DIRT-Cheap ...atleast a double or triple

 

[jamit_05]

5700 PE let loose 11 L in OI today. It reached almost 92 L intraday and at closing it is only 81 L; This is clear cut weakness. For further affirmations, will wait for sub 70 L levels at closing tomorrow.

5700 PE still holding at 83L; No Panic at 5750 SPOT. With 4 trading days to go for expiry, writers are expecting a closing above 5700 Spot. Interesting.

 

[Option.Trader]

5600/5700 PE still holding on at 80L odd OI.. 5700CE getting massively written into... all indications that 5600-5700 may be the range for expiry... need to watch 5700PE which holds the key to this whole mystery.. any unwinding there and all bets are off on the downside... for now 200DMA acting as strong support

 

[sridhar]

5600/5700 PE still holding on at 80L odd OI.. 5700CE getting massively written into... all indications that 5600-5700 may be the range for expiry... need to watch 5700PE which holds the key to this whole mystery.. any unwinding there and all bets are off on the downside... for now 200DMA acting as strong support

200DMA - Is it simple moving average or something else?

As per experts what is the best time frame ( of charts) to use for taking Nifty Options - Buy side positional calls, lasting upto 2-5 days.?

 

[boarders]

200 dma - 200 day moving average

 

[sridhar]

200 dma - 200 day moving average

The reason I asked was that 200day EMA in my charting software(daily closing value) is showing a value of 5829.27 & 200day SMA is showing 5754.38. Significant difference & both have been breached on 19th.