HDFC Bank Sees Robust Call Option Activity Amid Bullish Sentiment Ahead of January Expiry

Robust Call Option Volumes Highlight Investor Confidence

On 5 January 2026, HDFC Bank Ltd. (NSE: HDFCBANK) emerged as one of the most actively traded stocks in the call options segment. The most notable activity was concentrated at the ₹1,000 and ₹1,010 strike prices, both expiring on 27 January 2026. The ₹1,000 strike call option saw a remarkable 7,465 contracts traded, generating a turnover of ₹585.07 lakhs, while the ₹1,010 strike call recorded 5,141 contracts with a turnover of ₹291.24 lakhs. Open interest figures further underscore the bullish sentiment, with 10,648 contracts outstanding at the ₹1,000 strike and 4,091 at ₹1,010.

These strike prices are closely aligned with the underlying stock’s current market value of ₹988.65, indicating that traders are positioning for a potential upward move towards or beyond the ₹1,000 level within the next three weeks. The concentration of activity near the money suggests a strategic bet on the stock’s resilience and possible breakout above recent resistance levels.

Stock Performance and Technical Context

Despite the heightened options activity, HDFC Bank’s stock price closed down by 1.19% on the day, underperforming its sector by 1.06% and the broader Sensex by 1.04%. The stock is currently trading approximately 3.16% below its 52-week high of ₹1,020.50, reflecting some near-term consolidation after a strong rally. Technical indicators show the price hovering above its 100-day and 200-day moving averages, signalling a long-term uptrend, but below the shorter-term 5-day, 20-day, and 50-day moving averages, which suggests some short-term pressure.

Investor participation has seen a slight decline, with delivery volumes falling by 16.64% compared to the five-day average, indicating cautious trading ahead of the options expiry. Nevertheless, liquidity remains robust, with average traded value supporting sizeable trades up to ₹31.52 crores, ensuring smooth execution for institutional and retail investors alike.

Mojo Score Upgrade Reflects Improved Fundamentals

HDFC Bank’s recent upgrade from a ‘Buy’ to a ‘Strong Buy’ rating by MarketsMOJO on 2 January 2026, with a Mojo Score of 80.0, reinforces the positive outlook. The bank’s market capitalisation stands at a commanding ₹15,22,534.68 crores, categorising it as a large-cap heavyweight within the private sector banking space. The upgrade reflects improved financial metrics, operational efficiency, and sustained earnings growth, which underpin the bullish sentiment observed in the options market.

Analysts highlight the bank’s strong asset quality, expanding retail franchise, and digital initiatives as key drivers supporting its growth trajectory. The elevated open interest in call options at near-the-money strikes suggests that market participants are anticipating a continuation of these favourable trends, potentially driving the stock price closer to its 52-week highs in the coming weeks.

Expiry Patterns and Strategic Positioning

The expiry date of 27 January 2026 is a critical juncture for traders holding call options. The clustering of open interest and turnover at the ₹1,000 and ₹1,010 strikes indicates a strategic focus on these levels as potential price targets. Traders may be employing these options to hedge existing positions or to speculate on a short-term rally catalysed by upcoming quarterly results or macroeconomic developments.

Given the stock’s current price of ₹988.65, a move above ₹1,000 would represent a psychological and technical breakout, likely triggering further buying interest. The substantial open interest at these strikes also implies significant liquidity, enabling traders to enter and exit positions with relative ease.

Balancing Near-Term Risks with Long-Term Potential

While the call option activity signals optimism, investors should remain mindful of near-term risks. The stock’s recent underperformance relative to the sector and broader market, coupled with declining delivery volumes, suggests some caution among participants. Macroeconomic factors such as interest rate movements, regulatory changes, and geopolitical developments could influence the bank’s performance in the short term.

However, the bank’s strong fundamentals, market leadership, and upgraded rating provide a solid foundation for sustained growth. The current options positioning may also reflect a strategic approach by traders to capitalise on potential volatility around earnings announcements or policy updates.

Conclusion: Strategic Opportunity for Investors

HDFC Bank Ltd.’s active call option market and upgraded Mojo Grade highlight a compelling investment narrative. The concentration of call contracts at key strike prices near the current market value, combined with robust open interest and turnover, underscores a bullish consensus among sophisticated market participants. Investors looking to capitalise on this momentum should monitor price action closely around the ₹1,000 level and consider the broader macroeconomic context.

With a strong market capitalisation, improved ratings, and consistent operational performance, HDFC Bank remains a cornerstone stock in the private sector banking space. The current options activity offers valuable insights into market expectations and potential price trajectories in the weeks ahead.

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