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Informist, Monday, May 18, 2026

 

By Gopika Balasubramanium

 

MUMBAI – Nifty 50 ended higher as traders covered short positions in volatile trading. Two derivatives analysts said the market bias is positive and there are expectations of a recovery in the Nifty 50. Traders wrote put options across the board and covered their short positions in far-out-of-the-money call options on Monday, indicating expectations of an index rise.

 

The options chain shows that the near-term outlook for the Nifty 50 is bullish, Ashish Sherigar, technical and derivatives analyst at NVS Brokerage. Monday, the index recovered sharply from support zones as short sellers covered their positions, he said. For the index, 23800 is the major resistance, expectations are that the Nifty 50 will be in a range of 23650-23800," Sherigar said. "... if any of the levels are breached, then we will get to see 100-130 points momentum on either side," he added.

 

On Monday, the index closed at 23649.95 points, up by 6.45 points. The index fell as low as 23317.10 points, but recovered to close marginally higher. While the index fell on the back of the rupee falling to a record low and recovered despite the currency hitting fresh lows. The Indian currency ended at a record closing low of 96.3450 a dollar on Monday.  

 

On Monday, traders covered their short positions at far-out-of-the-money strike prices such as 25000, 25500, and 26000. This indicates that market participants hope the index will see some upside in the coming sessions, perhaps a steady recovery. The 25000 call saw the most bouts of short covering, a level which the index has not breached in the spot market ever since the war began. 

 

"Unless we see a sudden volume-backed breakout, the expiry is projected to be range-bound between 23400 and 24000," Bhavya Shah, technical and derivatives analyst at StoxBox, said. The current put call ratio has improved to 1.36 from 0.93 Friday, Shah said. 

 

At call contracts with strike prices 24000, 24200, and 23800, traders added 2.0-2.6 million short bets on Monday, capping the downside for the index. The premiums on these strike prices fell sharply by 51-78%. The highest addition of open interest, as well as the maximum concentration, was at 24000 call.

 

Traders sold put contracts expiring next week at near out-of-the-money strike prices. They wrote put contracts at strike prices such as 23400 and 23300 with their premiums falling 59-61%, indicating that these levels could be good support. The highest addition of open interest was at 23400 put, and the maximum concentration was at the 23000 put.

 

--Nifty 50 May closed at 23659.00, up 15.10 points; 9.05-point premium to the spot index

--Nifty 50 June closed at 23731.30, down 8.50 points; 81.35-point premium to the spot index

--Nifty 50 July closed at 23844.90, up 4.70 points; 194.95-point premium to the spot index

 

HDFC Bank, Amber Enterprises, Bharti Airtel, State Bank of India, Tata Steel, Vodafone Idea, BSE, Reliance Industries, and Infosys were the most actively traded underlying stocks Monday. End

 

Edited by Saji George Titus

 

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