Interpreting top 10 open interest – 22-July-2011

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As options open interest shows us the footprint of smart money/big players, so lets try to decipher their footprint. Here is the list of option strikes (July expiry) that have got highest open interest as of Friday’s close.

Option open interest 22-July-2011

Option open interest 22-July-2011

Observations –
1) 5600 and 5700 level Puts are added developin 5600 level as support. 55oo Put has highest OI which will act as strong support for expiry week.
2) 5800 Call observed major interest and OI has gone up this week indicating the resistance has shifted upward from 5700 to 5800.
3) This week’s price range was 112 points making it one of the narrowest week. Hence we can expect expansion in market in next or week after next. Next week being contract expiry week, we might see volatile week as players try to protect their positions.

4) For next series, 5700 Calls and 5400/5500 Puts have already got nice built up.

Interpretation –
1) For now the range for current series is established between 5500/5600 on downside and 5700/5800 on upside.

Hope this analysis helps you in forming your own views on market. Feel free to drop your comments on the post. Let me know if you would like to see something more in the analysis.

Disclaimer These are my views on the market and I could be wrong in reading it. Please use your own judgment and make sensible trading decision based on your own analysis.

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3 Comments on “Interpreting top 10 open interest – 22-July-2011”

  • 30 July, 2011, 14:58

    Nice analysis of open interest. Do u have any information or historical data on ET Intelligence SMR  indicator.

  • Trader anup
    30 July, 2011, 15:31

    Thanks Nandkishore. Good to know that you liked the analysis.
    Sorry, I don’t have data about SMR indicator, so can’t help you much.

  • Nikhil kapur
    3 August, 2011, 11:32

    @trader anup quite informative article THANX!!!

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