26 Jul ’23 Post Mortem on BankNifty | Options premiums are LOW

Banknifty on the other hand gave a trend reversal signal in just a day. For nifty we had atleast 3 days in succession. I took some short positions yesterday intraday and was all geared up to further attack by shorting more CALLS today.

The opening minutes looked encouraging, so did the period from 10.35 to 11.15 but 2 things went against it.
The options data showed lack of interest in creating CE credit spreads i.e shorting near ATM call option and buying a far away OTM option.

Banknifty started to rally and take the place of NiftyIT which reversed from its intraday high.
It was like 2 brothers who came prepared from evening to support their sister, when one brother got tired, the other one jumped in. In our case the BankNifty brother did more than just support - it rallied an impressive 252pts ~ 0.55% up till 14.30.
The short trade negation came in banknifty only after the 46000 got taken out. Let us see how the expiry day is getting played out tomorrow because as it stands the options premium in banknifty looks pretty low. The India VIX staying in the 10 range is also a discouragement for the bears that are still left.


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