HDFC Bank Sees Heavy Call Option Activity Amid Mixed Technical Signals

Robust Call Option Volumes Highlight Investor Interest

On 23 February 2026, HDFC Bank Ltd. (NSE: HDFCBANK) recorded significant call option volumes, with the most active strikes clustered around the ₹920 to ₹930 range for the 24 February expiry. The strike price of ₹930 saw the highest number of contracts traded at 7,113, accompanied by an open interest of 6,734 contracts, indicating strong open positions held by traders anticipating upward price movement.

The ₹920 strike followed closely with 7,015 contracts traded and an open interest of 3,521, while the ₹925 strike recorded 6,725 contracts traded and an open interest of 4,078. The turnover for these strikes was substantial, with ₹288.6 lakhs at ₹920, ₹201.95 lakhs at ₹925, and ₹137.3 lakhs at ₹930, underscoring the liquidity and active participation in these call options.

At the time, the underlying stock price stood at ₹922.3, placing the ₹920 and ₹925 strikes near-the-money and the ₹930 strike slightly out-of-the-money, suggesting traders are positioning for a modest upside in the immediate term.

Stock Performance and Technical Context

HDFC Bank Ltd. outperformed its private sector banking peers by 0.52% on the day, registering a 1.15% gain compared to the sector’s 0.76% and the Sensex’s 0.64%. This marked a reversal after four consecutive days of decline, signalling a potential short-term recovery.

Technically, the stock price is trading above its 5-day moving average but remains below its 20-day, 50-day, 100-day, and 200-day moving averages. This mixed technical picture suggests that while short-term momentum is improving, medium- to long-term trends remain under pressure.

Investor participation has shown signs of waning, with delivery volume on 20 February falling by 20.28% to 1.35 crore shares compared to the five-day average. Despite this, liquidity remains adequate, with the stock capable of supporting trade sizes up to ₹39.15 crore based on 2% of the five-day average traded value.

Mojo Grade Downgrade and Market Cap Insights

Despite the recent bullish option activity, HDFC Bank Ltd.’s Mojo Grade was downgraded from Hold to Sell on 9 February 2026, reflecting concerns over valuation and near-term earnings momentum. The company’s Mojo Score stands at 48.0, indicating a cautious stance from the analytical framework.

The bank remains a large-cap heavyweight with a market capitalisation of ₹14,19,243.08 crore, ranking it among the most significant constituents in the private sector banking space. However, its Market Cap Grade is rated 1, suggesting limited upside potential relative to its size and current valuation.

Expiry Patterns and Implications for Traders

The concentration of call option activity around the 24 February expiry indicates that traders are positioning for a near-term price move, possibly anticipating positive developments or technical rebounds. The clustering of open interest at strikes ₹920, ₹925, and ₹930 suggests a consensus expectation that the stock will trade at or above these levels by expiry.

Open interest at the ₹930 strike is particularly noteworthy, as it is the highest among the call strikes, signalling that many traders are betting on the stock crossing this threshold. This could lead to increased volatility as expiry approaches, especially if the underlying price hovers near these strike prices.

Balancing Bullish Sentiment with Caution

While the surge in call option volumes and turnover points to bullish sentiment, investors should weigh this against the downgrade in the stock’s Mojo Grade and the technical resistance posed by longer-term moving averages. The recent decline in delivery volumes also suggests some hesitation among long-term holders.

Given these factors, traders might consider a cautious approach, monitoring price action closely around the ₹920-₹930 range and watching for confirmation of sustained momentum before committing to larger positions.

Outlook and Strategic Considerations

HDFC Bank Ltd.’s current option market activity reflects a nuanced outlook. The bullish positioning in call options suggests traders expect a rebound or positive catalyst in the short term. However, the downgrade in fundamental grading and the technical resistance levels caution against over-optimism.

Investors should consider the broader macroeconomic environment, sectoral trends, and upcoming corporate announcements that could influence the stock’s trajectory. The private sector banking industry continues to face challenges such as credit growth moderation and regulatory scrutiny, which may temper upside potential.

For those seeking exposure to the banking sector, it may be prudent to evaluate alternative large-cap stocks with stronger fundamental grades and more favourable technical setups, as identified by analytical tools and thematic lists.

Summary

In summary, HDFC Bank Ltd. is currently a focal point for active call option trading, with significant volumes and open interest concentrated near the ₹920-₹930 strikes for the imminent expiry. This activity signals bullish sentiment among traders, supported by a recent price rebound and outperformance relative to peers.

Nevertheless, the downgrade to a Sell Mojo Grade and mixed technical indicators suggest caution. Investors should balance the near-term optimism reflected in options markets with the broader fundamental and technical context before making investment decisions.

Key Data Points at a Glance:

• Underlying stock price: ₹922.3
• Most active call strikes: ₹920 (7,015 contracts), ₹925 (6,725 contracts), ₹930 (7,113 contracts)
• Open interest at ₹930 strike: 6,734 contracts
• Turnover at ₹920 strike: ₹288.6 lakhs
• Mojo Grade: Sell (downgraded from Hold on 9 Feb 2026)
• Market cap: ₹14,19,243.08 crore
• 1-day stock return: 1.15% vs sector 0.76% and Sensex 0.64%

Investors and traders should continue to monitor option expiry dynamics and underlying price action closely in the coming days to gauge the sustainability of the current bullish momentum.

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