Nifty Fin Service Expiry today: Options market considers 23,950 to be crucial level

Equity markets opened flat on Tuesday but faced selling pressure to trade in the red by noon. The benchmark NIFTY50 and the SENSEX were trading 0.57% and 0.50% lower at 24,638 and 80,744, respectively, at 12:00 p.m. The Nifty Financial Services index, which expires on Tuesday, was trading 0.30% lower at 23,883 at noon.

The options market is currently factoring in strong resistance at the 24,000 level, with the open interest on the Call strike amounting to 52.82 lakh. At the time of writing, the change in open interest for the strike stood at 29.66 lakh.

On the downside, the market is considering the 23,900 level to act as an immediate support. The open interest on this Put strike stood at 42.31 lakh while the change in open interest stood at 32.35 lakh by 12:00 p.m.

The max pain of Nifty Financial Services stood at 23,950 at the time of writing. The max pain theory shows the level at which option sellers are likely to have the least loss on expiry. However, this level is dynamic and is prone to change toward the end of the session. On a 15-minute chart, the index was trading below its 21-exponential moving average (EMA) and the 50-EMA.

India VIX, an index that reflects the anticipated volatility in the market over the next 30 days, rose 1.89% on Tuesday to 18.37.

The Nifty Financial Services index reflected a put-call ratio (PCR) of 0.74 which indicates a moderately bullish sentiment. PCR is the ratio of the number of puts to the number of calls of an asset. In extreme downward and upward market movements, the PCR may hit as low as 0.5 or as high as 1.8, respectively.