How to identify call/put writing on a perticular strike price?

#1
Hi,
can anyone explain how to identify whether call or put writing has taken place on a perticular strike price .Also inform how to identify call or put buying has taken place in considerable amount on a perticular strike price.THANKS in advance .
 
#2
Hi,
can anyone explain how to identify whether call or put writing has taken place on a perticular strike price .Also inform how to identify call or put buying has taken place in considerable amount on a perticular strike price.THANKS in advance .
If you are checking out nifty options, you can find all the options here... the most traded ones will be on the top.

http://www.nseindia.com/marketinfo/fo/fomwatchsymbol.jsp?key=NIFTY

of course you can replace NIFTY in the above link with any other nse symbol...
 

AW10

Well-Known Member
#3
Hi,
can anyone explain how to identify whether call or put writing has taken place on a perticular strike price .Also inform how to identify call or put buying has taken place in considerable amount on a perticular strike price.THANKS in advance .
Check out the Open Interest (OI) number for a particular strike price of underlying. If OI has gone up that means more new options are written by someone and equal numbers are bought by someone else..

If OI has reduced means, people have squared off their open positions.

Happy Trading.
 
#4
Ya, if open interest rises , that means new options are being written or bought .
Let me give an example - if open interest of nifty november 2600 call option rises by 40 % on a perticular session ,what will that suggest? are people buying 2600 calls or writing 2600 calls .Both will have opposite implication.buyers are bullish while writers are bearish.

How to differentiate between call buyers and call writers of a perticular strike?
 

pkamalesh

Well-Known Member
#5
Ya, if open interest rises , that means new options are being written or bought .
Let me give an example - if open interest of nifty november 2600 call option rises by 40 % on a perticular session ,what will that suggest? are people buying 2600 calls or writing 2600 calls .Both will have opposite implication.buyers are bullish while writers are bearish.

How to differentiate between call buyers and call writers of a perticular strike?
That was what was confusing me too..plzzzz lemme know if u get it..
 

AW10

Well-Known Member
#6
Ya, if open interest rises , that means new options are being written or bought .
Let me give an example - if open interest of nifty november 2600 call option rises by 40 % on a perticular session ,what will that suggest? are people buying 2600 calls or writing 2600 calls .Both will have opposite implication.buyers are bullish while writers are bearish.

How to differentiate between call buyers and call writers of a perticular strike?
Call buyers and call seller (i.e. writers) always have to be equal.. In the market, for each seller there has to be a buyer to complete the transaction. OI number comes out from completed transactions .. not from the pending orders.
eg - If someone wants to write 10000 nifty 3000 call, but there are only 2000 nifty 3000 call buyer... then OI will be 2000, not 10000. Remaining 8000 will be reflected as pending sell order but the transaction is incomplete so will not be counted in OI.

Exactly same concept works for Volume numbers for Stock transaction.
I will be surprised if it is counted in some other way.

Happy Trading.
 

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