Nifty Open Interest Analysis

[sridhar]

U mean 5700ce going to 80?

Great call. Did you calculate based on delta or on chart levels?

 

[Option.Trader]

Let's keep posting trade able ideas to make most of market conditions
I'm looking to short above 5755

This is what happens if you are biased. I would have been better of playing trend than against it. Took 5800@ 60 & it went upto 39. Just saved as I was not following and could not put stoploss, it will be a struggle to even get buy price

 

[shivan]

How much change in OI is considered good so as to think that writers have confidence about that level.

 

[Option.Trader]

How much change in OI is considered good so as to think that writers have confidence about that level.

Not change in open interest, but rather total OI, above 70 l it indicates a bias towards a trend, change in oi indicates strength in the trend

 

[shivan]

can we identify sideways market looking at option table.

 

[sridhar]

You can read the expected range. But remember it is very dynamic & changes constantly. So your interpretation is as important - keep studying the table & slowly u will start to see the patterns. Be patient & do it over a couple of months.
I am still getting the hang of it. Expiry week is the most confusing to interpret.

 

[sridhar]

Comments @ 14:17
I can understand the logic of OI addition in 5800CE as it looks like the market has peaked.

However what is the explanation for addition in OI (ie. people writing options) at 5800PE? Could it be a belief, of the put option writers, that the market will expire above whatever will be their breakeven?

 

[Option.Trader]

Comments @ 14:17
I can understand the logic of OI addition in 5800CE as it looks like the market has peaked.

However what is the explanation for addition in OI (ie. people writing options) at 5800PE? Could it be a belief, of the put option writers, that the market will expire above whatever will be their breakeven?

Put writers are people who are bullish, in this case they expect an expiry above 5800 and hence want to eat premium. 5800 put has fallen from 200 odd levels to just 8 in 5 days.

 

[spkreddy]

OT

any idea of expiry..5900 cal above 70L so can be expect expiry below 5900

 

[sridhar]

OT

any idea of expiry..5900 cal above 70L so can be expect expiry below 5900

Looks like 5800PE & 5900CE are determining the range @ 9million each OI. Rough approx calculations is for expiry between 5912 & 5800. (Not exact - but approx!!).