Steel Authority Of India Ltd Sees Sharp Open Interest Surge Amid Bullish Momentum

Open Interest and Volume Dynamics

On 25 Feb 2026, SAIL’s open interest (OI) in derivatives rose sharply to 42,650 contracts, up 25.95% from the previous day’s 33,862 contracts. This substantial increase of 8,788 contracts indicates a surge in market participation and fresh positioning by traders. The volume for the day stood at 30,079 contracts, reflecting robust trading activity that supports the OI expansion.

The futures value traded was approximately ₹89,884.29 lakhs, while the options segment saw an even larger notional value of ₹15,042,972,562 lakhs, culminating in a total derivatives turnover of ₹95,363.76 lakhs. This liquidity underscores the stock’s attractiveness to both hedgers and speculators, with ample depth to accommodate sizeable trades without excessive slippage.

Price Action and Technical Strength

SAIL’s underlying price closed at ₹165, hitting a new 52-week high intraday peak of ₹167.2, marking a 4.38% gain on the day. The stock has outperformed its sector by 1.53% and the broader Sensex by 3.38% in the last trading session, reflecting strong relative strength. Notably, SAIL has recorded consecutive gains over the past two days, delivering a cumulative return of 5.76% during this period.

Technically, the stock is trading above all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a sustained uptrend. The sector comprising Steel, Sponge Iron, and Pig Iron has also gained 2%, providing a supportive backdrop for SAIL’s rally. Rising delivery volumes, which surged by 258.97% to 2.11 crore shares on 24 Feb compared to the 5-day average, further confirm strong investor participation and conviction.

Market Positioning and Directional Bets

The sharp rise in open interest alongside strong volume suggests that market participants are actively building positions, likely anticipating further upside in SAIL’s stock price. The increase in OI by nearly 26% is a classic indicator of fresh money entering the market rather than short covering, which typically results in declining OI.

Given the stock’s recent breakout to a 52-week high and sustained momentum above key moving averages, traders appear to be positioning for a continuation of the bullish trend. The futures and options data imply that both long futures contracts and call options are being accumulated, signalling positive directional bets on the stock.

However, the stock’s Mojo Score of 65.0 and a Mojo Grade of Hold (upgraded from Sell on 23 Dec 2025) suggest a cautious stance from fundamental analysts. While the technical momentum is strong, the market cap grade of 2 and mid-cap status indicate moderate risk and volatility, which investors should factor into their risk management strategies.

Sectoral and Macro Context

The ferrous metals sector has been buoyed by improving demand prospects, both domestically and globally, driven by infrastructure spending and industrial activity. SAIL, as a leading player with a market capitalisation of ₹68,521.28 crore, stands to benefit from these tailwinds. The sector’s 2% gain on the day reinforces the positive sentiment, although SAIL’s outperformance highlights its relative strength within the group.

Liquidity remains healthy, with the stock’s traded value supporting trade sizes up to ₹7.05 crore based on 2% of the 5-day average traded value. This ensures that institutional investors can enter or exit positions without significant market impact, further encouraging participation.

Investor Implications and Outlook

For investors, the surge in open interest combined with strong price action and volume signals a favourable environment for potential gains in SAIL. The stock’s technical indicators suggest momentum is intact, supported by sectoral strength and improving fundamentals. However, the Hold rating and mid-cap classification advise a balanced approach, with attention to volatility and market swings.

Traders should monitor open interest trends closely in the coming sessions to confirm whether the fresh positioning sustains or reverses. A continued rise in OI with price appreciation would reinforce bullish conviction, while any divergence could signal profit booking or increased caution.

Overall, Steel Authority Of India Ltd. remains a key stock to watch within the ferrous metals space, offering a blend of growth potential and sectoral leverage amid evolving market dynamics.

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