NTPC, PFC: 5 F&O stocks see long OI build-up; Here's how to trade in them
Build-up of long OI in general indicates that traders are expecting the price of the underlying stock or index to gain in the near-term.
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Even as the markets dwindled under selling pressure in the last two trading sessions last week, select stocks continued to witness significant build-up in open interest (OI) on the long (Buy) side, data suggests.
Build-up of OI on the long side in general indicates that traders are expecting the price of the underlying stock or index to gain in the near-term.
Cipla, NTPC, PFC, PowerGrid Corporation and REC were the five stocks to have witnessed a price gain backed by rise in OI in the last four trading sessions. This implies a likely build-up of long positions at these counters.
NTPC in particular has logged steady gains in the last four trading sessions, and was up 4.2 per cent along with a 15.5 per cent rise in OI. PFC dipped marginally in the last two trading sessions, but still holds a net gain of 7.2 per cent in the last four trading sessions backed by a 14.6 per cent jump in OI.
REC has seen the highest build-up in OI, up 21.5 per cent since March 03, 2023. The stock did decline 2.8 per cent on Friday, but was up 3.4 per cent in the last four days.
PowerGrid Corporation and Cipla too have recorded marginal gains of 1.9 per cent and 0.1 per cent in the last four days, while the OI have risen significantly by 16.7 per cent and 15.7 per cent.
Going ahead, these are the key levels to be watched out on the stocks
NTPC
Target: Rs 187
Support: Rs 178
Along with the OI build-up in the March futures contract, NTPC has also witnessed significant addition in OI at Rs 180 and Rs 185 Strike Prices. The overall PCR (Put Call Ratio) at 0.45 also substantiates the bullish sentiment at the counter.
Technically, the stock closed above the higher-end of the Bollinger Bands on the weekly chart. This indicates, that the near-term bias is likely to remain bullish as long as the stock sustains above Rs 178. On the upside, the stock could rally to Rs 187-odd levels.
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Views by: Osho Krishan, Sr. Analyst - Technical & Derivative Research, Angel One
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First Published: Mar 13 2023 | 8:36 PM IST
