F&O stocks: Godrej Properties, Oberoi Realty among 5 stocks with short buildup
Coming to the buildup of fresh short positions, When the stock prices move downward and open interest on the counter increases, it is taken as a sign of a short build-up. The signal is considered more reliable if the volume on the counter has also seen an increase as the stock price was declining.
ABB India dropped by 3.17%, and the open interest saw an increase of 1.16%.
Godrej Properties fell 3.1%, and open interest saw an increase of 1.58%.
Titan declined by 3.04%, and open interest saw a rise of 7.96%.
Oberoi Realty stock price fell by 2.95%, and open interest saw a rise of 2.4%.
Hindustan Aeronautics dropped by 2.89%, and the open interest saw an increase of 5.49%.
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Some additional checks would help traders in taking better trading decisions as they increase the probability of a follow-up of the upward movement in the stock price.
First, if this short build-up is accompanied by any bearish crossover, it means that during the current down move, when the open interest has increased, the stock price has moved below its 20, 50, or 100-day moving average. Another couple of points traders should keep in mind when taking a trade based on the matrix of short position build-up on the basis of open interest. Also, check whether there is any extraordinary build-up of long positions in any out-of-money put options, especially any far-out-of-the-money put options. This indicates the probability of an informed person taking
