Put Writ­ing at 7,800 & 7,900 Of­fers Sup­port

The Economic Times - - Companies -

ETMar­kets.com: The Nifty50, which sur­passed its cru­cial psy­cho­log­i­cal level of 7,900 ear­lier this week, lost some mo­men­tum in Wed­nes­day’s trade, but strike prices 7,800 and 7,900 will pro­vide ad­e­quate sup­port to the in­dices in case it starts drifting south­ward, op­tions data showed.

FreshPutwrit­ing­wasseenat­strike prices 7,700 (8.8 lakh con­tracts added), 7,800 (25.61 lakh con­tracts added) and 7,900 (13.16 lakh con­tracts added), which will pro­vide the much­needed sup­port in case Nifty50 starts cor­rect­ing, op­tions data col­lated on Mon­day showed. Call un­wind­ing was also wit­nessed at strike prices from 7,500 to 8,000, which has a bullish un­der­tone. Call op­tion writ­ers are re­vers­ing their po­si­tions as chances of the mar­ket head­ing north­ward are higher than the re­verse.

Call un­wind­ing was seen at strike prices 8,000 (9.9 lakh con­tracts shed), 7,900 (7.4 lakh con­tracts shed), 7,600 (5.05 lakh con­tracts) and 7,500 (4.9 lakh con­tracts shed).

If the in­dex does start head­ing south­ward, it will have sup­port near 7,850 and be­low that long liq­ui­da­tion may at­tract profit book­ing, caus­ing Nifty to de­cline to­wards the next ma­jor sup­port at 7,777, which is its 200-day ex­po­nen­tial mov­ing av­er­age, ex­perts said.

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