Sensex Expiry today: Options market reflects 81,500 level to be crucial

Equity markets opened lower on Friday and continued to trade in the red by noon. The benchmark Nifty 50 was trading lower by 0.91% at 24,917.25 at 12:00 p.m.

The Sensex, which has its expiry on Friday, traded lower by 0.99% at 81,387.39 at 12:00 p.m. The options market is currently factoring in an immediate resistance at the 81,500 level with the open interest at this Call strike amounting to 23.7 lakh. The change in open interest for the strike stood at 23.5 lakh.

On the downside, the market is reflecting a strong support at the 81,000 level with the Put options at this strike having an open interest of 29.5 lakh at the time of writing. The change in open interest stood at 24 lakh.

The max pain of the Sensex stood at 81,500 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.

On a 15-minute chart, the index was trading below its 21-period and 50-period exponential moving averages (EMAs). The index reflects a put-call ratio (PCR) of 0.79 which indicates a neutral sentiment. PCR is the ratio of the number of puts to the number of calls of an asset. It is noteworthy that in extreme downward and upward market movements, the PCR could hit as low as 0.45 and as high as 1.8, respectively.

India VIX, an index that reflects the anticipated volatility in the market over the next 30 days, rose 4.79% on Friday to 14.89 by noon.