In 26,000 CE, implied volatility (IV) decreased from above 26 to 15.77, while on the largest put basis, IV decreased from 54.88 to 15.07. Compared to the previous week, a significant IV decline suggests that the market is returning to stability and that there is less chance of significant price movements. Following last Friday’s session, the NSE’s most recent options data shows a tight trading range, with the support level rising by 4,350 points to 25,000 PE and the resistance level slightly declining by 200 points to 26,000 PE.

The greatest Call OI is recorded by the 26,000 CE, followed by the 26,800/25,500/26,500/25,000/24,800/25,800 strikes, and the heavy to moderate build-up of Call OI is recorded by the 26,800/26,500/25,900/25,100 strikes. At some deep ITM hits, a little Call OI decline is seen.

The put side shows a maximum put base at 25,000 PE, followed by strikes at 24,500, 24,700, 24,800, and 23,800. Furthermore, there was a little increase in Put OI for strikes of 25,000, 24,700, 24,000, 23,700, and 22,100. Only a few deep OTM put strikes saw a little drop in OI.

“In the derivatives market, prominent Call Open Interest for Nifty was seen at the 25,500 and 25,000 strikes, while the notable Put Open Interest was at the 25,000 strike,” said Dhirender Singh Bisht, assistant vice-president (technical research-equity) at SMC Global Securities Ltd. The 25,000 level will be crucial in the next session. For the Bank Nifty, there was considerable Put Open Interest at the 55,000 strike and noteworthy Call Open Interest at the 55,500 and 56000 strikes.

The biggest put concentration, which seems to be a component of portfolio hedging, was placed close to the ATM 25,000 Put strike due to the significant volatility over the last week. Call OI is dispersed among the OTM and ATM strikes, with 24,500 strikes placed immediately.

Following the announcement of a truce between India and Pakistan, the market surged. The market was also buoyed by other factors, such as the anticipation of a trade agreement between the US and India and FII purchases of stocks in May. Bank Nifty increased by more than 3.25 percent during the same time period, while Nifty ended the week up more than 4 percent. Chemicals, pharmaceuticals, and fast-moving consumer goods (FMCG) were underperforming industries, whereas Indian railroads, capital markets, and defense were leading sectors, Bisht said.

The BSE Sensex finished at 82,330.59 points for the week ending May 16, 2025, a climb of 2,876.12 points, or 3.61 percent, from the closing of 79,454.47 points the week before (May 9). Additionally, the NSE Nifty rose 1,011.8 points, or 4.21 percent, from 24,346.70 points to 25,019.80 points one week ago.

The India VIX dropped 2.03% to 16.55. The market’s strength might be extended above 24,800 if it moves over 24,500. In contrast to the average of 14% that we have seen since October 2024, the India VIX has increased significantly in recent days and is now trading close to the 22% mark. The rising India VIX is indicating that index options should be purchased to safeguard the portfolio from any scenario. This week, the VIX will drop down, and the market will seek a respectable comeback.

The Bank Nifty

The banking index of the Bank Nifty NSE ended the week at 55,354.90 points, a strong 1,759.65 or 3.28 percent gain from the closing of 53,595.25 points the week before.