Open Interest and Volume Dynamics
On 23 Jan 2026, NMDC Ltd’s open interest (OI) in futures and options contracts rose sharply to 92,152 contracts, up by 9,079 contracts or 10.93% compared to the previous day’s 83,073. This increase in OI was accompanied by a futures volume of 36,916 contracts, reflecting active participation in the derivatives market. The combined futures and options value stood at approximately ₹11,43,296 lakhs, with futures alone accounting for ₹1,13,002.56 lakhs, underscoring the significant monetary flow in the stock’s derivatives segment.
Such a pronounced rise in open interest typically indicates fresh positions being established rather than existing ones being squared off. This suggests that traders are either building new directional bets or hedging strategies amid the stock’s recent price movements.
Price Performance and Technical Context
NMDC’s underlying share price closed at ₹77, reflecting a 1.85% decline on the day, slightly underperforming the Minerals & Mining sector’s 1.47% drop and the broader Sensex’s 0.91% fall. The stock has been on a downward trajectory for six consecutive sessions, cumulatively losing 8.35% over this period. Despite this short-term weakness, the share price remains above its 100-day and 200-day moving averages, signalling that the longer-term trend may still be intact. However, it trades below its 5-day, 20-day, and 50-day moving averages, indicating near-term selling pressure and potential resistance levels.
Investor participation appears to be waning, with delivery volumes on 22 Jan falling by 9.72% to 85.6 lakh shares compared to the five-day average. This decline in delivery volume suggests reduced conviction among long-term holders, possibly contributing to the recent price softness.
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Market Positioning and Potential Directional Bets
The surge in open interest alongside a declining price suggests a complex interplay of market forces. Typically, rising OI with falling prices can indicate that new short positions are being initiated, reflecting bearish sentiment. However, it can also imply that long hedgers are increasing their protection against further downside risks.
Given NMDC’s current Mojo Score of 70.0 and an upgraded Mojo Grade from Hold to Buy as of 1 Dec 2025, the stock retains a positive fundamental outlook. The market cap grade of 2 places it comfortably in the mid-cap category, with a market capitalisation of ₹67,503.58 crores. The stock’s dividend yield of 4.22% at the current price adds an attractive income component for investors, potentially cushioning downside risks.
Liquidity remains adequate, with the stock’s average traded value supporting trade sizes up to ₹3.26 crores based on 2% of the five-day average. This ensures that institutional and retail participants can execute sizeable trades without significant market impact.
Sector and Broader Market Context
NMDC’s performance today was broadly in line with its sector, which also experienced a decline of 1.47%. The Minerals & Mining sector has faced headwinds recently due to fluctuating commodity prices and global economic uncertainties. Despite these challenges, NMDC’s relative resilience above key moving averages and its strong dividend yield position it favourably compared to peers.
Investors should monitor the evolving open interest trends closely. A sustained increase in OI coupled with stabilising or rising prices could signal renewed bullish interest. Conversely, if OI growth continues alongside price declines, it may confirm bearish positioning and potential further downside.
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Implications for Investors and Traders
For investors, the current scenario presents a nuanced picture. The fundamental upgrade to a Buy rating and a solid dividend yield support a medium to long-term positive outlook. However, the recent price weakness and falling delivery volumes caution against aggressive accumulation at this stage.
Traders in the derivatives market appear to be positioning for increased volatility. The sharp rise in open interest and futures volume suggests that both bulls and bears are actively engaged, possibly anticipating a directional move in the near term. Close attention to changes in put-call ratios, strike-wise open interest, and expiry dynamics will be crucial to decode the dominant sentiment.
Given the stock’s liquidity and active derivatives market, NMDC remains a viable candidate for tactical trades, including spreads and hedged positions, to capitalise on expected price swings while managing risk.
Outlook and Conclusion
NMDC Ltd’s recent open interest surge amid a backdrop of price decline and mixed technical signals highlights a market in flux. While the fundamental upgrade and dividend yield provide a positive anchor, the short-term price action and investor participation trends warrant caution. The derivatives market activity suggests that participants are gearing up for potential volatility, making it imperative for investors and traders to monitor positioning data closely.
Ultimately, NMDC’s trajectory will depend on broader commodity price trends, sectoral developments, and macroeconomic factors. For now, the stock offers a compelling blend of value and volatility, suitable for investors with a balanced risk appetite and traders seeking active opportunities.
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