Axis Bank Sees Heavy Call Option Activity Ahead of December Expiry

Call Option Trading Highlights

Data from the derivatives segment reveals that Axis Bank's call options expiring on 30 December 2025 have attracted substantial interest across multiple strike prices. The underlying stock closed at ₹1,246.10, with the most active call strikes clustered between ₹1,260 and ₹1,300. Notably, the ₹1,300 strike price recorded the highest number of contracts traded at 8,110, accompanied by an open interest of 6,934 contracts. This level is approximately 4.6% above the current underlying price, indicating market participants are positioning for a potential upward move in the near term.

Other strike prices with significant activity include ₹1,280, where 5,263 contracts changed hands with an open interest of 3,843, and ₹1,270, which saw 4,835 contracts traded and an open interest of 2,473. The ₹1,260 strike also featured prominently with 4,825 contracts traded and an open interest of 3,040. The ₹1,290 strike price, slightly above the current market price, recorded 4,359 contracts traded and an open interest of 6,464.

The turnover figures for these strikes further underscore the intensity of trading interest. The ₹1,260 strike led with a turnover of ₹430.63 lakhs, followed by ₹1,270 at ₹322.74 lakhs and ₹1,280 at ₹251.97 lakhs. The ₹1,290 and ₹1,300 strikes posted turnovers of ₹139.22 lakhs and ₹180.95 lakhs respectively. This volume and turnover concentration at strikes above the current price level reflect a market sentiment that is cautiously optimistic about Axis Bank's near-term prospects.

Price Performance and Market Context

Axis Bank's stock price has shown some volatility in recent sessions. The share price is currently about 4.76% away from its 52-week high of ₹1,304, indicating proximity to a significant resistance level. However, the stock has underperformed its sector by 2.67% on the day of 16 December 2025 and has recorded a consecutive two-day decline, with a cumulative fall of 3.21% over this period. Intraday lows touched ₹1,236.60, reflecting a 3.75% dip from the previous close.

Technical indicators present a mixed picture. The stock price remains above its 50-day, 100-day, and 200-day moving averages, signalling longer-term support. Conversely, it trades below its 5-day and 20-day moving averages, suggesting short-term pressure. Investor participation appears to be waning, with delivery volumes on 15 December falling by 42.19% compared to the five-day average, which may indicate reduced conviction among buyers at current levels.

Liquidity conditions remain adequate for sizeable trades, with the stock's average traded value supporting transactions up to approximately ₹7.15 crores based on 2% of the five-day average traded value. This level of liquidity is consistent with Axis Bank's status as a large-cap stock with a market capitalisation of ₹3,98,880 crores.

Options Market Sentiment and Expiry Dynamics

The concentration of call option open interest at strike prices above the current market value suggests that traders are positioning for a potential rally in Axis Bank shares ahead of the 30 December expiry. The highest open interest at the ₹1,300 strike price, coupled with significant activity at ₹1,290 and ₹1,280 strikes, points to a cluster of resistance levels that market participants are monitoring closely.

Such positioning often reflects a cautiously optimistic outlook, where investors anticipate the stock to test or surpass these levels by expiry. The relatively high turnover at these strikes also indicates active trading and hedging strategies, which could influence price movements as expiry approaches.

It is worth noting that while the call option activity is robust, the underlying stock's recent price softness and reduced delivery volumes suggest that market participants are balancing bullish expectations with caution. This dynamic may lead to increased volatility in the coming weeks as traders adjust their positions in response to evolving market conditions and corporate developments.

Sector and Broader Market Comparison

Axis Bank operates within the private sector banking industry, a segment that has experienced varied performance in recent months. On the day in question, the stock's one-day return was -2.86%, which contrasts with the sector's one-day return of -0.61% and the Sensex's decline of -0.37%. This relative underperformance highlights the stock's sensitivity to sector-specific and broader market factors.

Given the bank's large-cap status and significant market capitalisation, its price movements often reflect a combination of macroeconomic influences, regulatory developments, and investor sentiment towards the financial sector. The current options market activity may be interpreted as a hedging mechanism or speculative positioning in anticipation of upcoming corporate announcements or macroeconomic data releases.

Investors and traders should monitor the evolving open interest and volume patterns in the options market alongside price action in the underlying stock to gauge shifts in market sentiment. The interplay between these factors will be crucial in determining Axis Bank's trajectory as the December expiry approaches.

Conclusion

Axis Bank's options market activity ahead of the 30 December 2025 expiry reveals a pronounced focus on call options at strike prices above the current market level, signalling a degree of bullish positioning among market participants. Despite recent price declines and reduced delivery volumes, the concentration of open interest and turnover at strikes between ₹1,260 and ₹1,300 suggests expectations of a potential price recovery or rally in the near term.

Traders and investors should remain attentive to the stock's price behaviour relative to key moving averages and monitor the evolving options market data for indications of changing sentiment. The balance between cautious optimism and short-term pressure will likely shape Axis Bank's performance as expiry draws near, offering opportunities for those who analyse these dynamics carefully.

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