Can Nifty 50 Overcome Rs 1-Lakh-Crore Worth Call Writers' Bet?

The benchmark Nifty 50 has attempted to breach the 25,000-mark seven times but has failed each time. This level has now emerged as a strong psychological resistance, with Call writers applying pressure and forcing the bulls to work harder with every attempt.

Nifty's May futures and options contracts are set to expire on May 29. Given the volatility this month—driven by foreign institutional flows and geopolitical tensions—open interest levels remain elevated.

To put things in perspective, the notional turnover in Call contracts between the 24,800–25,000 strike range for both May and June totalls Rs 13.5 lakh crore. In premium terms, this amounts to Rs 10,343 crore.

However, it's the open interest that really stands out. For Call strike prices between 24,800 and 25,000 (24800, 24850, 24900, 24950, 25000) across May and June, the total open interest is valued at Rs 1.05 lakh crore — with Rs 80,000 crore concentrated in just the top five strike prices of the May contract. The largest buildup is at the 25,000 Call strike for both May and June.

Much of this open interest is expected to roll over into the June series ahead of the May expiry this Thursday.

• 25,000 May Call Open Interest Value: Rs 32,483 crore

• 25,000 June Call Open Interest Value: Rs 6,372.4 crore

This heavy Call writing at the 25,000 level is acting as a ceiling, preventing the index from breaking through decisively.

Despite an open interest of Rs 20,194 crore at the 25,000 Put, the Call writers continue to dominate. There's been noticeable unwinding at the 25,000 May Put, with a shift in interest to the 24,800 May Put.

Meanwhile, Put writers are establishing strong support at the 24,500 and 24,000 levels for both May and June:

• 24,500 May Put Open Interest: Rs 21,765 crore

• 24,500 June Put Open Interest: Rs 7,971 crore

• 24,000 May Put Open Interest: Rs 28,237 crore

• 24,000 June Put Open Interest: Rs 9,870 crore

This suggests two key support levels are forming—first at 24,500 and then at 24,000.

With just two days left until May expiry, the market is witnessing strong rollovers. Around 50% of positions have already shifted to June Nifty Futures. The remaining May short positions are expected to be closed through short covering or long unwinding.

Foreign investors have also begun rolling over to the June contract. FPI open interest in Nifty Futures is Rs 6,000 crore higher compared to the end of the April series. On May 27 alone, they added Rs 2,685 crore in shorts, pushing total FPI open interest in Nifty Futures to Rs 22,799.75 crore. Their long positions have declined to 31.35% of total positions, and the long-short ratio has dropped to 0.46—its lowest in over a month.

With resistance consistently emerging at 25,000, all eyes are now on how Call Writers manage their positions during the rollover in the next two days.