Nifty 50 (23,346) and Nifty Bank (56,359) slipped 0.2 per cent and 0.4 per cent respectively over the last week.

Both indices opened last week with a gap-up but failed to sustain and saw a strong sell-off. Although both indices recovered, it could not erase all the losses. The charts show that the bearish bias persists.

Below is an analysis of futures and options data of Nifty 50 and Nifty Bank. 

Nifty (Sep) futures (23,379) was down 0.5 per cent last week. Notably, the outstanding OI (Open Interest) of this contract dropped 3 per cent during this period and stood at 174 lakh contracts on Friday.

While a drop in price along with a decline in OI indicates that some of the longs made an exit, at a broader level, the index witnessed the arrival of fresh sellers. That is, the cumulative OI of Nifty futures rose 2 per cent to 224 lakh contracts as the underlying index fell.

That said, the options indicate a neutral sentiment as PCR (Put Call Ratio) of both September and October expiries stood at near 1 on Friday. But going by futures data, weakness in Nifty persists.

The charts reflect the same. There was a sharp intraday fall last Tuesday (Monday was a holiday) despite a positive open and the following recovery lacked conviction. As we stated last week, the outlook will remain negative so long as the September futures trades below 23,750.

Nevertheless, this does not rule out the possibility of a minor rally to the 23,650-23,750 price band before Nifty futures fall again. Once the decline resumes, the contract can drop to 22,800. Support below 22,800 is at 22,600. 

On the other hand, in case Nifty futures surpasses 23,750, it can move up to 24,000. A breach of 24,000 can trigger a rally to 24,500. 

Strategy: Sell Nifty (Sep) futures if it rises to 23,650. Place initial stop-loss at 23,825. When the contract slips to 23,300, after the trade is initiated, revise the stop-loss to 23,500. Book profits at 23,150.

Nifty Bank (Sep) futures (56,527) lost 0.6 per cent last week. Similar to Nifty (Sep) futures, there was a moderation in outstanding OI – it dropped 6 per cent over the last week to 20.5 lakh contracts. 

However, unlike in Nifty 50, the cumulative OI of Nifty Bank futures too fell 2 per cent and it stood at 24.4 lakh contracts on Friday. This along with a decline in the underlying index and the futures indicates long unwinding.

On the other hand, PCR of September option increased from 0.91 to 1 over the last week, showing traders sold comparatively more put options than call options. This is a positive sign because traders sell puts when they are bullish.

Importantly though, the PCR of October options saw a considerable fall from 1.13 to 0.59 over the last week. This was due to heavy selling of calls, particularly 58000-call of October expiry.

Overall, the derivatives data provides a bearish tilt in sentiment, in line with the charts.

The price action shows that an attempt to rally early last week was blocked by the barrier at 57,000. The chart shows that, even though there was some recovery post the decline, there is a notable selling interest.

However, there is a chance for a temporary uptick to 57,000-57,250 from the current level. A fresh decline, either from the current level of 56,527 or after a rise to the above-mentioned price region, can drag Nifty Bank futures to 55,550. Subsequent support is at 55,000.

Instead, if the September futures surpass the resistance at 57,250 and 57,500, the outlook can become bullish, potentially leading to a rally to 58,500 and 59,000.

Strategy: Traders can short Nifty Bank (Sep) futures if it moves up to 57,150. Place stop-loss at 57,800. When the contract drops to 56,000, tighten the stop-loss to 56,500. Book profits at 55,600.

Published on September 19, 2026