The Nifty ended 46 points lower at 8,143.6 on Monday, led by losses in IT stocks. Nifty crossed the psychological 8,200 levels during the intraday trade, but could not stay above it as selling pressure crept in at higher levels. Changes in options open interest (outstanding positions) suggest that crossing 8,200 is going to be further difficult on Tuesday.
The 8,200 and 8,300 strike October Nifty calls have added open interest of 8.3 lakh and 6.1 lakh shares respectively to 51 lakh and 53.7 lakh shares, making 8,200-8,300 level a crucial resistance for the Nifty on the upside.
Similarly open interest in the 8,000 and 8,100 strike calls puts have increased by 3.3 lakh and 2.7 lakh shares. Open interest in the 8,100 put now stands highest at 46.3 lakh shares followed by 8,000 put at 45.9 lakh shares which indicate that on the downside 8,100 is likely to act as a major support for the Nifty.
Overall puts have added 10 lakh shares to open interest while open interest in calls have jumped by 19.6 lakh shares pushing the put-call-ratio (PCR) to 1.01 from 1.02 earlier. PCR works as a sentiment indicator for the market; a PCR of more than 1 indicates bullish sentiment for the market.
Meanwhile, open interest in the October future increased by 8.8 lakh shares along with reduction in future premium to 6 points from 15.65 points earlier; clearly, short positions have been added to Nifty.
Among individual stocks Mindtree and TCS witnessed addition of bearish bets while UCO Bank and Andhra Bank saw addition of bullish bets.