Reliance Industries Sees Heavy Call Option Activity Ahead of January Expiry

Recent Price Performance and Market Context

Reliance Industries, a heavyweight in the oil sector with a market capitalisation of ₹19,30,542.01 crores, has been under pressure in recent sessions. The stock has declined by 2.15% in the last trading day, underperforming its sector by 0.4% and the broader Sensex by 1.63%. Over the past two days, Reliance has lost 2.02% in value, touching an intraday low of ₹1,418.6, down 2.7% from previous levels.

Technical indicators reveal that the stock is trading below all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a bearish trend in the short to medium term. However, rising investor participation is evident, with delivery volumes on 16 January surging by 70.87% to 1.13 crore shares compared to the five-day average, indicating heightened interest despite the price weakness.

Call Option Activity: Strike Prices and Expiry Patterns

The most active call options for Reliance Industries are concentrated around the 27 January 2026 expiry, with strike prices ranging from ₹1,440 to ₹1,600. Notably, the strike price of ₹1,600 has seen the highest open interest at 33,267 contracts, accompanied by 12,701 contracts traded on the day, generating a turnover of ₹56.52 lakhs. This strike is significantly out-of-the-money, given the underlying stock price of ₹1,429.8, suggesting speculative bullish bets or protective hedging by institutional players.

Other strike prices with substantial activity include ₹1,550, which recorded 10,695 contracts traded and an open interest of 16,685, and ₹1,520 with 9,224 contracts traded and 11,132 open interest. The ₹1,450 and ₹1,440 strikes also attracted heavy volumes, with 14,672 and 12,065 contracts traded respectively, and open interest levels of 6,368 and 3,261.

The turnover figures at the ₹1,440 and ₹1,450 strikes stand out, with ₹762.51 lakhs and ₹676.38 lakhs respectively, indicating strong premium inflows and active positioning around these near-the-money levels. This clustering of activity suggests that traders are positioning for a potential rebound or volatility spike before expiry, despite the current downtrend.

Investor Sentiment and Bullish Positioning

The concentration of call option open interest at strikes above the current market price indicates a predominantly bullish sentiment among option traders. The ₹1,600 strike, in particular, reflects expectations of a strong upside move in the near term, possibly driven by upcoming corporate developments or sectoral tailwinds in the oil industry.

However, the stock’s recent underperformance and technical weakness suggest that these bullish bets carry risk. The decline below all major moving averages and the intraday lows near ₹1,418.6 highlight the challenges Reliance faces in regaining upward momentum. Traders holding these call options may be anticipating a short squeeze or a rebound catalysed by positive news flow or improved crude oil prices.

Open interest data also reveals that the ₹1,550 and ₹1,520 strikes have seen increased activity, which could be indicative of hedging strategies by institutional investors seeking to protect long stock positions or to capitalise on volatility ahead of expiry.

Liquidity and Trading Dynamics

Reliance Industries remains highly liquid, with a five-day average traded value supporting trade sizes up to ₹34.3 crores comfortably. This liquidity facilitates active options trading and allows market participants to execute large trades without significant price impact.

The turnover figures for call options on 19 January 2026 reflect robust market participation, with the ₹1,440 strike alone generating ₹762.51 lakhs in premium turnover. Such volumes underscore the importance of options as a tool for both speculation and risk management in Reliance’s stock.

Mojo Score and Analyst Ratings

MarketsMOJO assigns Reliance Industries a Mojo Score of 62.0, reflecting a Hold rating, downgraded from Buy on 6 January 2026. This adjustment signals a more cautious stance amid the recent price weakness and mixed technical signals. The company’s Market Cap Grade remains at 1, confirming its status as a large-cap stock with significant market presence.

Investors should weigh the current bearish technical backdrop against the heavy call option activity, which may presage a potential turnaround or increased volatility. The stock’s performance relative to the oil sector and broader market indices suggests that selective entry points and risk management will be crucial in the coming weeks.

Outlook and Strategic Considerations

Given the elevated open interest in out-of-the-money call options and the clustering of activity near the ₹1,440 to ₹1,600 strikes, market participants appear to be positioning for a recovery or a volatility event before the January expiry. However, the stock’s failure to hold above key moving averages and the recent consecutive declines caution against aggressive bullish bets without confirmation of a trend reversal.

Traders and investors should monitor upcoming corporate announcements, crude oil price movements, and sectoral developments closely. The interplay between technical weakness and options market optimism creates a nuanced environment where both upside potential and downside risks coexist.

In summary, Reliance Industries’ options market activity reveals a complex picture of investor sentiment, blending speculative bullishness with prudent hedging. This dynamic warrants careful analysis and disciplined trading strategies for those engaged with the stock in the near term.

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