Published on 28/11/2019 5:21:58 PM | Source: Motilal Oswal Services Ltd

Views On Perspective on F&O Expiry - Mr. Chandan Taparia

Posted in Expert Views| #Expert Views #Market Outlook #Motilal Oswal

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Below is the Views On Perspective on F&O Expiry By Mr. Chandan Taparia, VP – Research, Derivatives & Technical Analyst, Motilal Oswal Financial Services Limited


Nifty index continued its positive momentum for third consecutive series and closed at life time high near to 12150 zones. It has been gradually shifting its support to higher zones while entered into new life time high territory. Index traded in range of 350 points for most part of the series in between 11800 to 12150 zones with comparatively less market volatility despite the Global and domestic uncertainties. It has rallied by around 1500 points in last three series and overall price setup is positive which could drive the next leg of rally as supports are shifting higher.

On expiry to expiry basis, Bank Nifty has seen decent outperformance as it rallied by 6.84% and settled the November series at new life time high above 32100 zones, while Nifty closed the series with the gains of 2.30%. We have seen decent rally and participation in many heavyweight counters mainly ICICI Bank, HDFC Ltd, Reliance, SBIN, Indusind Bank, Tatasteel, Bhartiartl etc. Most of sector contributed except Media and Capital Good in this rally with bottomed out process was also seen in beaten down PSU and Pharma counters.

On the monthly option, December series has maximum Put OI at 12000 strike with outstanding inventory of 30.42 Lakh shares while maximum Call OI is at 12500 strike. Option data suggests a shift in trading range with overall higher option regime of 11900 to 12500 zones. After a long time we are witnessing such kind of heavy Put writing at the beginning of new series at nearby strike which suggests positive stance and high conviction among the market participant for the next rally towards 12250 then 12500 zones.

As per the provisional data Nifty and Bank Nifty has seen rollover of around 70% which is lower in Nifty in terms of percentage to the last series but in line in Bank Nifty index.

As per the technical setup, Bank Nifty has been making higher highs - higher lows from last seven weeks and till it holds above 31783, we are expecting the momentum to extend towards 32500 then 33000 zones. Nifty has recently given a consolidation breakout and a hold above 12000 could take it towards 12250 then 12400-12500 zones.

India VIX fell down by 14.08% and now at 14 mark, lower volatility suggests that bulls are holding the grip thus buy on decline strategy could continue in the market with bullish stance going forward.

Stock wise we are witnessing positive pattern and better rollover in Reliance, ICICI Bank, SBIN, L&T FH, Lichsgfin, Ultracemco and expecting these stocks to continue their northward journey at the beginning of December series.


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