Open Interest and Volume Dynamics
On 4 February 2026, Wipro’s open interest (OI) in derivatives rose sharply to 81,227 contracts from the previous 72,980, marking an increase of 8,247 contracts or 11.3%. This uptick in OI was accompanied by a daily volume of 35,648 contracts, indicating robust trading activity. The futures segment alone accounted for a value of approximately ₹51,554 lakhs, while options contributed a staggering ₹20,645.9 crores in notional value, culminating in a total derivatives value of ₹54,514 lakhs.
This surge in open interest, particularly in the context of a falling stock price, often points to fresh short positions being initiated or existing longs being unwound. The underlying share price closed at ₹233, having touched an intraday low of ₹226.26, a new 52-week low, reflecting significant selling pressure.
Price Action and Market Sentiment
Wipro’s stock performance on the day was notably weak, with a day change of -3.65%, underperforming the broader IT - Software sector, which declined by 4.96%. However, relative to the sector, Wipro marginally outperformed by 1.12%, suggesting some resilience despite the downward trend. The stock opened with a gap down of -2.79% and traded below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a bearish technical setup.
Investor participation has risen sharply, with delivery volumes on 3 February reaching 1.45 crore shares, a 75.68% increase over the five-day average. This heightened delivery volume indicates that long-term investors may be accumulating at lower levels, potentially anticipating a value opportunity given Wipro’s attractive dividend yield of 4.54%.
Market Positioning and Directional Bets
The combination of rising open interest and elevated volumes in the derivatives market suggests that traders are actively repositioning. The increase in OI amid falling prices typically implies that new short positions are being established, reflecting bearish sentiment. However, the substantial option market value hints at complex strategies, possibly including protective puts or spread trades designed to hedge existing exposures or speculate on volatility.
Given Wipro’s large-cap status with a market capitalisation of ₹2,54,266 crore, the stock remains a key focus for institutional investors and derivatives traders alike. The recent downgrade in Mojo Grade from Buy to Hold on 19 January 2026, with a current Mojo Score of 58.0, aligns with the cautious stance observed in the derivatives market. The market cap grade remains at 1, indicating high liquidity and tradability, which supports active derivatives participation.
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Sectoral Context and Comparative Performance
The IT - Software sector has been under pressure, with a 1-day return of -4.92%, contrasting with the Sensex’s modest gain of 0.23%. Wipro’s relative outperformance, despite its own decline, may indicate selective buying interest or defensive positioning within the sector. The stock’s liquidity, capable of supporting trade sizes up to ₹8.41 crore based on 2% of the five-day average traded value, further facilitates active trading and hedging strategies.
Technical indicators remain bearish, with the stock trading below all major moving averages, signalling a downtrend. The recent trend reversal after three consecutive days of gains underscores the prevailing negative momentum. However, the high dividend yield of 4.54% could attract income-focused investors seeking stability amid volatility.
Implications for Investors and Traders
For investors, the surge in open interest combined with falling prices suggests caution. The derivatives market activity points to increased short interest or hedging, which could exert further downward pressure in the near term. However, the rising delivery volumes and dividend yield may offer a counterbalance, attracting long-term holders looking for value entry points.
Traders should closely monitor the evolving open interest and volume patterns, particularly in options, to gauge shifts in market sentiment and potential volatility spikes. The large notional values in options indicate that sophisticated strategies are at play, possibly signalling upcoming directional moves or volatility hedges.
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Outlook and Strategic Considerations
Wipro’s current market dynamics reflect a complex interplay of bearish technical signals and underlying investor interest. The downgrade to a Hold rating by MarketsMOJO, effective 19 January 2026, suggests tempered expectations for near-term price appreciation. However, the company’s strong market capitalisation and liquidity profile continue to make it a focal point for derivatives traders and institutional investors.
Investors should weigh the risks of further downside against the potential for value accumulation, especially given the stock’s attractive dividend yield and relative sector resilience. Monitoring open interest trends and option market activity will be crucial in anticipating directional shifts and volatility changes.
In summary, the sharp increase in open interest amid a declining price environment signals active repositioning by market participants, with a bias towards cautious or bearish strategies. This environment calls for vigilant risk management and a nuanced approach to trading and investment decisions in Wipro Ltd.
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