Kalyan Jewellers Sees Sharp Open Interest Surge Amid Bullish Market Momentum

Open Interest and Volume Dynamics

The latest data reveals that Kalyan Jewellers’ open interest (OI) in futures and options contracts rose sharply by 6,891 contracts, an 11.82% increase from the previous tally of 58,275 to 65,166. This notable expansion in OI accompanies a daily volume of 86,423 contracts, underscoring a surge in market participation. The futures value stood at ₹44,784.01 lakhs, while the options segment exhibited an extraordinary notional value of approximately ₹39,335.20 crores, culminating in a combined derivatives market value of ₹59,247.20 lakhs.

This spike in open interest, coupled with elevated volumes, typically indicates fresh positions being established rather than existing ones being squared off. Such a pattern often points to increased conviction among traders regarding the stock’s near-term price trajectory.

Price Performance and Market Context

Kalyan Jewellers’ underlying stock price has mirrored this derivatives market enthusiasm. The share price opened with a gap-up of 6.51% and touched an intraday high of ₹418.25, marking a near 10% gain on the day. Over the past two sessions, the stock has delivered an impressive 11.19% return, substantially outperforming the Gems, Jewellery and Watches sector, which gained 2.05%, and the Sensex, which rose a modest 0.40% on the same day.

Despite this strong short-term momentum, the stock’s weighted average traded price skewed closer to the day’s low, suggesting some profit-taking or cautious positioning at elevated levels. The price currently trades above its 5-day and 20-day moving averages but remains below the longer-term 50-day, 100-day, and 200-day averages, indicating that while short-term momentum is positive, medium-term trends have yet to fully confirm a sustained uptrend.

Investor Participation and Liquidity Considerations

Interestingly, delivery volumes have declined by 22.83% compared to the 5-day average, with 13.23 lakh shares delivered on 6 Feb. This drop in investor participation at the delivery level contrasts with the surge in derivatives activity, hinting that much of the current market action is speculative or hedging-driven rather than driven by long-term accumulation.

Liquidity remains adequate for sizeable trades, with the stock’s average traded value supporting a trade size of approximately ₹3.88 crores based on 2% of the 5-day average traded value. This liquidity profile favours active traders and institutional participants looking to build or unwind positions efficiently.

Market Positioning and Directional Bets

The surge in open interest alongside rising prices and volumes suggests that market participants are increasingly bullish on Kalyan Jewellers. The stock’s Mojo Score has improved to 53.0, upgrading its Mojo Grade from Sell to Hold as of 19 Jan 2026, reflecting a more balanced outlook amid recent positive developments. However, the Market Cap Grade remains modest at 2, indicating that while the company is a mid-cap with a market capitalisation of ₹39,221 crores, it still faces challenges in scaling to large-cap status.

Traders appear to be positioning for further upside, possibly anticipating favourable earnings, sector tailwinds, or improved consumer demand in the gems and jewellery space. The sector itself has gained 2.05% recently, supported by rising gold prices and festive demand, which could underpin Kalyan Jewellers’ growth prospects.

Nevertheless, the divergence between strong derivatives activity and falling delivery volumes suggests caution. The market may be witnessing speculative bets or hedging strategies rather than broad-based accumulation by long-term investors. This dynamic warrants close monitoring, especially as the stock remains below key longer-term moving averages.

Technical and Fundamental Outlook

From a technical perspective, the stock’s ability to sustain above its 20-day moving average and maintain momentum will be critical for confirming a bullish trend. The current open interest increase supports this view, as fresh positions are being built. However, resistance near the 50-day moving average and the psychological ₹420 level could pose hurdles in the near term.

Fundamentally, Kalyan Jewellers operates in a competitive sector with cyclical demand patterns influenced by gold prices, consumer sentiment, and discretionary spending. The recent Mojo Grade upgrade to Hold signals that while the company is improving, investors should remain selective and watch for confirmation of sustained earnings growth and margin expansion before committing heavily.

Implications for Investors

For investors, the recent open interest surge in Kalyan Jewellers’ derivatives market signals an active trading environment with increased speculative interest. While the stock’s short-term price action is encouraging, the mixed signals from delivery volumes and longer-term moving averages counsel prudence.

Investors should consider the stock’s upgraded Mojo Grade of Hold as an indication of stabilising fundamentals but remain mindful of sector volatility and gold price fluctuations. Monitoring open interest trends alongside price and volume will be essential to gauge whether the current momentum can translate into a sustained uptrend.

Given the mid-cap status and moderate liquidity, Kalyan Jewellers remains a viable candidate for tactical trades and portfolio diversification within the gems and jewellery sector, but a cautious approach is advisable until clearer trend confirmation emerges.

Summary

Kalyan Jewellers India Ltd’s recent open interest increase of nearly 12% in derivatives contracts, combined with strong price gains and volume, highlights renewed market interest and potential bullish positioning. The stock’s outperformance relative to its sector and the Sensex, alongside an upgrade in its Mojo Grade to Hold, reflects improving investor sentiment. However, subdued delivery volumes and resistance at longer-term moving averages suggest that investors should balance optimism with caution. Close monitoring of derivatives activity and price trends will be key to assessing the sustainability of this rally in the coming weeks.

Upgrade at special rates, valid only for the next few days. Claim Your Special Rate →