What Does Nifty Option Chain Signal For The Next Trading Session?

About This Nifty Analysis

Nifty ended the latest session with a gain of 0.27% after recovering from the 24,300 region and crossing 24,400 during the day. More importantly, the derivatives setup carries a bullish undertone: Put writing is stronger than Call writing, the Put-Call Ratio stands at 1.49, and both FIIs and DIIs were net buyers in the cash market. However, the sizeable Call open interest at 24,600 remains an important hurdle for the bulls.

Nifty Recap: Buyers Defend The 24,300 Zone

Nifty opened positively but initially came under selling pressure. Buying emerged around the 24,300 level, allowing the index to recover gradually.

• Nifty bounced from around 24,300.
• The index subsequently crossed the 24,400 mark.
• Profit booking emerged around 24,430.
• Nifty eventually settled with a gain of 0.27%.

The recovery from lower levels indicates that buyers continued to absorb intraday selling pressure.

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Option Chain Shows A Bullish Undertone

The latest option chain data reveals significant open interest concentration on both sides of the market.

• Major Call OI: 24,600 Call
• Major Put OI: 24,000 Put
• Put-Call Ratio (PCR): 1.49
• Max Pain: 24,350
• VWAP Range: 24,230–24,485

Higher Put writing compared with Call writing indicates a bullish undertone in the options market.

What Does PCR Of 1.49 Indicate?

A Put-Call Ratio of 1.49 shows relatively heavy Put positioning compared with Calls. In the context of the supplied option-chain data, the higher Put writing supports the bullish sentiment assessment. However, traders should not use PCR in isolation. Price behaviour around the VWAP boundaries and the major Call and Put OI strikes will provide additional confirmation during the next session.

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VWAP Suggests This Trading Range

The Volume Weighted Average Price analysis indicates a potential trading range between:

• Lower VWAP Zone: 24,230
• Upper VWAP Zone: 24,485

The 24,485 region therefore becomes an important near-term level to monitor on the upside, while 24,230 represents the lower boundary of the indicated VWAP range. A sustained move beyond either boundary could signal an expansion beyond the expected trading range.

FIIs And DIIs Were Both Net Buyers

Institutional cash-market activity was supportive.

• FIIs: Net buyers of ₹277.48 crore.
• DIIs: Net buyers of ₹2,260.37 crore.

FII index futures positioning was also positive in the two major indices:

• Nifty: +13,129 net contracts
• Bank Nifty: +439
• Fin Nifty: +8
• Midcap Nifty: -63
• Nifty Next 50: -14

The combination of cash-market buying and positive Nifty futures positioning provides another constructive element to the overall setup.

Auto And Media Lead While IT And FMCG Lag

Sectoral participation remained selective.

• Top Performers: Auto and Media
• Lagging Sectors: IT and FMCG

Traders should therefore monitor whether broader sector participation improves alongside any attempt by Nifty to move above the upper end of its expected range.

Investor Takeaway

Indian-Share-Tips.com Nifty Expert Gulshan Khera, CFP®, who is also a SEBI Regd Investment Adviser, observes that the derivatives setup currently carries a bullish undertone, supported by higher Put writing, a PCR of 1.49 and positive institutional cash-market activity. The immediate battle zone is likely to remain around the 24,230–24,485 VWAP range. A sustained move above the upper boundary could strengthen bullish momentum, while failure to defend the lower end would require reassessment of the positive setup. The sizeable 24,600 Call OI remains an important overhead level to monitor.

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Written by Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.

Disclaimer: This article is intended solely for educational and informational purposes. Options data, PCR, open interest, institutional activity and technical levels can change rapidly and should not be interpreted as investment advice or a recommendation to buy or sell securities. Investors and traders should conduct their own analysis or consult a SEBI Registered Investment Adviser before making investment decisions.