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Banking stocks had ended higher by three-quarter of a per cent on increased buying ahead of quarterly earnings from heavyweights amid strengthening of rupee and lower crude prices.
Bank Nifty October contract had ended higher by 234.75 points at 25,601. The underlying value of the contract closed at 25,589.65.
Active call options of Oct 25 expiry
Among the call option chain, the in-the-money Bank Nifty Call 25,000 option was the actively traded contract on Tuesday. The option price closed at Rs 728.80, up by 17.70 per cent.
Open interest in the contract was reduced by 7.22 per cent. The implied volatility was seen higher at 18.70 per cent. This confirms that the underlying Bank Nifty may encounter stiff resistance around 25,700-25,750 levels in the short term.
Bank Nifty Call 26,000 option contract is currently an out-of-the-money option that turned very active on Tuesday. The contract price gained 16.05 per cent to Rs 162.
OI in the contract saw an increase to the tune of 20.55 per cent as traders took fresh positions here. The IV of the option price was seen higher at 18.85 per cent. This indicates that the underlying Bank Nifty is likely to meet strong resistance around 26,100-26,150 levels if the index clears the 25,750 resistance levels.
Active put options of Oct 25 expiry
On the put option chain, the in-the-money Bank Nifty Put 25,600 option contract was the most actively traded contract on Tuesday. The put option price was down 40.39 per cent at Rs 334.
However, open interest jumped 914 per cent for this contract. The implied volatility was comparatively higher at 22 per cent which implies that this contract was in good demand. This confirms that the underlying may get traction around 25,250-25,300 levels in case of a decline.
Bank Nifty out-of the-money put 25,500 strike price was one of the most actively traded contracts on Tuesday. This out-of-the-money put option price fell 37 per cent to Rs 295.10.
OI jumped 26.20 per cent. The IV of the option price was relatively higher at 26.21 per cent which suggests that the traders expect the underlying to decline. This suggests that the Bank Nifty underlying is likely to get support around 25,200-25,300 levels in case of a fall.
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