Reliance Industries Sees Surge in Put Option Activity Amid Bearish Sentiment

Put Option Activity Highlights

On 16 February 2026, Reliance Industries Ltd (NSE: RELIANCE) recorded the most active put options with the 1400 strike price expiring on 24 February 2026. A total of 4,696 contracts were traded, generating a turnover of ₹224.47 lakhs. Open interest at this strike stands at 7,992 contracts, indicating substantial investor interest in downside protection or speculative bearish bets.

The underlying stock price was ₹1,410.40 at the time, just above the 1400 strike, suggesting that traders are positioning for a potential decline or increased volatility in the near term. This level also acts as a psychological support, and the heavy put activity could be interpreted as a hedge against further downside or a speculative play anticipating a breach below this level.

Price and Technical Context

Reliance Industries has been under pressure recently, with the stock falling for three consecutive sessions, losing 3.55% over this period. The daily price range has narrowed to ₹7.4, reflecting subdued volatility despite the bearish undertone. The stock is trading below all major moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a sustained downtrend.

Investor participation has risen sharply, with delivery volumes on 13 February reaching 72.58 lakh shares, an 84.25% increase over the five-day average. This heightened activity suggests that market participants are actively adjusting positions amid the recent price weakness.

Liquidity remains robust, with the stock’s traded value supporting trade sizes up to ₹28.13 crore based on 2% of the five-day average traded value, ensuring that option and stock trades can be executed efficiently without significant market impact.

Mojo Score and Market Positioning

Reliance Industries currently holds a Mojo Score of 62.0, categorised as a Hold rating. This represents a downgrade from a previous Buy rating as of 6 January 2026, reflecting a more cautious outlook amid recent price weakness and sector headwinds. The company’s market capitalisation stands at a substantial ₹19,08,754.74 crore, affirming its status as a large-cap heavyweight in the oil sector.

The stock’s one-day return was -0.64%, slightly underperforming the oil sector’s -0.34% and contrasting with the Sensex’s modest 0.06% gain on the same day. This relative underperformance aligns with the increased put option interest, signalling investor concern over near-term downside risks.

Expiry Patterns and Investor Behaviour

The 24 February 2026 expiry is attracting significant attention, with the 1400 strike price put options dominating activity. This expiry is less than two weeks away, intensifying the focus on short-term price movements. The concentration of open interest at this strike suggests that traders are either hedging existing long positions or speculating on a decline below this level.

Such positioning is typical in volatile or uncertain market environments, where investors seek to protect gains or limit losses through put options. The elevated open interest also implies that a substantial number of contracts remain outstanding, which could influence price dynamics as expiry approaches.

Sectoral and Broader Market Context

The oil sector has faced mixed pressures recently, including fluctuating crude prices, regulatory developments, and global economic uncertainties. Reliance Industries, as a key player, is sensitive to these factors, which are reflected in its recent price action and option market activity.

While the stock’s fundamentals remain robust, the technical signals and option market data suggest that investors are adopting a more defensive stance. This is consistent with a Hold rating and the recent downgrade from Buy, indicating that while the stock is not expected to collapse, caution is warranted.

Implications for Investors

For investors, the surge in put option activity at the 1400 strike price ahead of the 24 February expiry is a clear signal to monitor downside risks closely. The stock’s failure to hold above key moving averages and the consecutive days of decline underscore the need for caution.

Those holding long positions may consider protective strategies such as buying puts or tightening stop-loss levels. Conversely, traders with a bearish outlook might view the current option market dynamics as an opportunity to capitalise on potential further weakness.

It is also important to note that the stock’s liquidity and rising delivery volumes provide a conducive environment for executing such strategies without excessive slippage or market impact.

Outlook and Conclusion

Reliance Industries Ltd is navigating a challenging phase marked by technical weakness and increased bearish sentiment as evidenced by option market activity. While the company’s large-cap status and sector fundamentals offer some support, the current market positioning suggests a cautious approach is prudent.

Investors should closely watch price action around the 1400 level and expiry developments in the coming days. The evolving put option interest will likely continue to influence the stock’s near-term volatility and directional bias.

Overall, Reliance Industries remains a key stock to watch within the oil sector, with option market signals providing valuable insights into investor sentiment and risk management strategies.

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