F&O Cues: Key support & resistance levels for Nifty 50

Highest put option open interest contract was added at a strike price of 16000 for expiry on 27 January.

After five days of consecutive falls, equity markets today showed some sign of recovery at the end. India VIX today did jump for the first five minutes, but then cooled off from the levels of 24.14 to close at 21.54. Nifty 50 seems to have retraced from its 78.6% Fibonacci level and 61.8 per cent Fibonacci extension. Today market closed at 17,278 level, up 0.75% from yesterday’s close. Although the markets have shown a recovery today, volatility is still expected to continue due to the US Fed meeting and Russia -Ukraine faceoff. Today, PSU Banks stole the show as the Nifty PSU Bank Index was up 4.2% and this was followed by Nifty Auto and Nifty Media. In fact, today the broader market outperformed Nifty 50.

Activity on the F&O front for weekly expiry on January 27 shows 18000 to act as a strong resistance now. Highest open interest contract of 173191 stood at this strike price. The second-highest call option open interest 145296 for Nifty 50 stood at a strike price of 17500. In terms of the highest addition of open interest in the call options front, it was at 17300 in the last trading session. A total of 12498 open interest was added at this strike price.

In terms of put activity, the highest put writing was seen at a strike price of 16000 where 32109 open interest was added on January 25, followed by 16800 where (21876) open interest was added. Highest total put open interest (120903) stood at a strike price of 16000. This is followed by a strike price of 17000, which saw a total put option open interest of 109931 contracts.

The Nifty 50 put call ratio (PCR) closed at 0.71 for the day. A PCR above 1 is considered bullish while a PCR below 1 is considered bearish.

Max pain at the end of today's trade stands at 17350.