Derivative Big Shot-Indian Market View, VOL-017

Learning Quote: Short Box (Arbitrage): Short Box is an arbitrage strategy. It involves selling a Bull Call Spread (1 ITM and 1 OTM Call ) together with the corresponding Bear Put Spread (1 ITM and 1 OTM Put), with both spreads having the same strike prices and expiration dates. The short box strategy is opposite to Long Box (or Box Spread). It is used when the spreads are overpriced with respect to their combined expiration value. This strategy is the combination of 1 Spread (4Trades) and the profit/ loss calculated together as 1 trade. Note that the “total cost of the box remain same” irrespective to the price movement of underlying security in any direction. The expiration value of the box spread is actually the difference between the strike prices of the options involved.

Nifty Futures: 14642.70 (-2.30%)

Bank Nifty Futures: 35168.00 (-1.90%)

USDINR: 72.75 (-0.53%)

India Vix: 25.47 (+14.47%)

FII Data (Approx.)

Institution/Daily Net Position/Monthly Net Position (Derivatives, In Crores...)

FII (-893cr.) (+22981cr.)

DII (-919cr) (-17558cr.) 

FII Futures (-600cr.) (-2150cr.)

FII Options (+4195cr) (+20106cr.) 

Put Call Ratio/Maximum Pain

NIFTY 0.99/14750

BANK NIFTY 0.68/35400

Stocks in the News

Vedanta - GR Arun Kumar resigned as a whole-time director & chief financial officer of the company.

Bharti Airtel - The company will meet global fixed income investors on or after Feb 23, 2021, to take the decision on the issuance of foreign currency bonds/ notes.

Bharat Forge - The company signed an agreement with Paramount Group for the production of protected vehicles in India.

Nifty- Option Chain

Maximum CE open interest of 25.63 lakhs contracts was seen at 14,800 strikes, which will act as a crucial resistance, while maximum PE open interest of 28.17 lakh contracts was seen at 14500 strikes. 

Nifty has key support levels for the day are 14540 followed by 14440. If the index moves up, the key resistance levels to watch out for the level of 14742 and 14842.

Bank Nifty- Option Chain

Maximum CE open interest of 6.37 lakhs contracts was seen at 35,500 strikes which will act as a crucial resistance, while maximum PE open interest of 7.02 lakh contracts was seen at 34,500 strikes. 

Bank Nifty has key support levels for the Bank Nifty are 34900 followed by 34600. If the index moves up, the key resistance levels to watch out for are 35500 and 35800.

Top Pick

Stop loss triggered in Drreddy as false breakout happened in it. Next time onward, please avoid initial 5 minutes of trading to settle the price movement on breakout recommendations.

Buy Balkrishna Inds futures above 1560. Stop loss 1530. Target 1600.

Options top pick in Index we will provide during market hours.