RESEARCH ALERTS: NIFTY 3200 to offer solid support

What is open interest?

Open Interest (OI) position in futures and options indicate market-wide participation of derivative players. An increase in open interest with call-put ratio of less than one indicates oversold positions for the markets where as the call-put ratio above one indicates overbought position for the market.

What happened on Tuesday?

The Nifty 3200 put option has built up huge OI position in the last six trading days moving up from 6.22 lakh on March 13 to 21.24 lakh yesterday.

According to analysts, this is an indication that 3200 levels would be a very significant support level in case of further correction.

While the overall OI in put options increased further by 5.32 lakh shares yesterday, the OI in call options, too, increased by 2.50 lakh shares.

The annualised cost of carry (CoC) of Nifty March futures is a negative 29.29% as against negative 15.64% on Monday. March futures are trading at a discount of 21 points.
 

OPEN INTEREST                                                                   (In million)
Underlying	21-Mar	20-Mar	17-Mar	16-Mar	14-Mar	13-Mar
Nifty	63.07	61.51	60.65	60.06	59.67	58.25
SBI	14.11	13.51	14.15	13.90	14.01	12.79
RIL	23.46	23.90	26.89	28.97	29.54	29.60
BHEL	2.58	2.72	2.77	2.84	2.77	2.82
Siemens	0.85	0.77	0.74	0.76	0.75	0.75
Tata Steel	20.32	19.66	20.01	21.58	20.93	20.82
Tata Motors	7.04	6.66	7.62	8.34	8.07	7.99
Total	1185.35	1183.87	1187.11	1184.04	1174.48	1150.90