Deploy modified Call Butterfly strategy in Nifty
The upcoming week can be approached with a low-risk strategy like modified Call Butterfly in Nifty.
Research by Quantsapp Advisory, SEBI-registered research analyst (Reg. No. INH000006332)
Nifty OI PCR for the week has increased to 1.299 from 0.836
Shubham Agarwal
Nifty Future closes the week around 18893, gaining 1.40%. During the week, Nifty gyrated between 18955 - 18624. Bank Nifty June Futures closed almost flat for the week around 44023 and gyrated between 44310 to 43526.
Further diving into the upcoming weekly expiry, Nifty has immediate resistance stands at 19000 levels where nearly 64.47 lakh shares is the open interest of CE options followed by vital resistance at 19100 levels where about 55.28 lakh shares of CE options is the open interest. On the lower side immediate support level is at 18800 where nearly 98.47 lakh shares are the PE options open interest followed by 18700 where nearly 124.8 lakh shares is the PE options open interest.
Looking at the Bank Nifty upcoming weekly expiry data, on the upside, immediate and vital resistance is at 44500 where nearly 20.51 lakh shares is the CE open interest, whereas, on the lower side immediate and vital support is at 44000 PE, about 27.86 lakh shares, which is the PE open interest. There is a substantial OI at 44,000 CE of about 39.39 lakh shares.
India VIX, fear gauge, decreased to 10.79 over a week-to-week basis from 11.12. Further, any uptick in India VIX could accentuate the downward move in Nifty and vice versa.
Looking at the sentimental indicator, Nifty OI PCR for the week has increased to 1.299 from 0.836 and Bank Nifty OIPCR over the week increased to 0.981 from 0.766 compared to last Friday. Overall data indicates PE writers were more aggressive than CE writers in Nifty.
Moving further to the weekly contribution of sectors to Nifty, IT and FMCG contributed positively by +24.76 and +90.67 points, respectively. Oil & Gas contributed positively to Nifty by +78.61 points. Private Bank and PSU Bank contributed negatively to Nifty by about -21.82 and -8.59 points, respectively.NBFC contributed positively to Nifty by +24.63 points, Cement and Pharma contributed positively to Nifty by +10.58 and +19.02 points respectively. Metal contributed positively to Nifty by +18.80 points.
Looking towards the top gainer & loser stocks of the week in the F&O segment, IDFC First Bank topped by gaining over 12.80%, followed by L&T Finance Holdings 11.80%, Dixon Technologies 11,2%. Whereas ZEE lost -3.40%, Wipro has lost over -3.10% and Hero MotoCorp lost -2.30% over the week.
The upcoming week can be approached with a low-risk strategy like modified Call Butterfly in Nifty.
This trade idea was published on 19 Jun 2023 by Shubham Agarwal for Quantsapp Advisory, a SEBI-registered research analyst (Reg. No. INH000006332) and an independent proprietorship, not Quantsapp Private Limited. It reflects the market on that date and is not a current recommendation.
First published on 19 Jun 2023: prices, lot sizes and expiries are those of that time. They are illustrations for education only, not investment advice. Derivatives trading carries risk; read all scheme and risk documents before trading.