Open Interest Analysis for Option Trading
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We are going to discuss OI analysis for Trading - Option and Future
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We are going to discuss OI analysis for Trading - Option and Future
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There are 4 terms that we need to understand first.
1. Long Build up
2. Short Build up
3. Long Unwinding
4. Short Cover
We will discuss one by one and understand their use for trading.
There are 4 terms that we need to understand first.
1. Long Build up
2. Short Build up
3. Long Unwinding
4. Short Cover
We will discuss one by one and understand their use for trading.
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Long build up
Long build up
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Short Build Up
Short Build Up
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Long Unwinding
Long Unwinding
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Short Cover
Short Cover
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Once You understand these four terms then you need to understand that all stocks or index are move in cycle.. We will understand those sequence or cycle in next few tweets.
Once You understand these four terms then you need to understand that all stocks or index are move in cycle.. We will understand those sequence or cycle in next few tweets.
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First Sequence
Long - Long unwinding
First Sequence
Long - Long unwinding
Long - Long Unwinding sequence is a bullish sequence. These are all Future build ups.
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Short - short covering sequence is a bearish sequence.
Short - short covering sequence is a bearish sequence.
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These sequence help us to understand the market trend... Long - long winding sequence is bullish the second one short short cover is bearish. Once you know the trend the time is to analyse.
These sequence help us to understand the market trend... Long - long winding sequence is bullish the second one short short cover is bearish. Once you know the trend the time is to analyse.
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Fact : Options are govern by writers.
See the example..
Fact : Options are govern by writers.
See the example..
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Why writers drive market ? See the graph for answer.
Why writers drive market ? See the graph for answer.
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Second Feature of writers
Second Feature of writers
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Simple thing is that writers have great insights of the market.. They fails few times and when they fail flood comes..
As an option buyer you need to identify their failure.
When they go wrong, we go right.
Simple thing is that writers have great insights of the market.. They fails few times and when they fail flood comes..
As an option buyer you need to identify their failure.
When they go wrong, we go right.
Now you have to do is
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You can also do this
You can also do this
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Now taking an example of AmbujaCem.... 11th Oct, 2019 Closing data..
Highest Call at 200.
Highest Put at 190.
Fut trading at 189.8.
Now it may move in two direction either down or up... And this movement depends on 190 put strike.
Now taking an example of AmbujaCem.... 11th Oct, 2019 Closing data..
Highest Call at 200.
Highest Put at 190.
Fut trading at 189.8.
Now it may move in two direction either down or up... And this movement depends on 190 put strike.
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If Put addition has been Notice at 190.. Then it will give up side movement min 2.5% in 2 or 3 trading seasons.
Or If Put unwinding has been Notice at 190. Then downside movement will be seen.
If Put addition has been Notice at 190.. Then it will give up side movement min 2.5% in 2 or 3 trading seasons.
Or If Put unwinding has been Notice at 190. Then downside movement will be seen.
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Ambuja Live fut price... It is almost 3% up.. What is the reason?
Ambuja Live fut price... It is almost 3% up.. What is the reason?
See, Addition In OI at 190 put..
And unwinding at 190, 195 and 200 calls. This is a clear indication that the scrip will move up side...
Put writers sell a strike as they believe price will be above that level. They are bull.
Call writers sell a strike as they are bearish.
End.
And unwinding at 190, 195 and 200 calls. This is a clear indication that the scrip will move up side...
Put writers sell a strike as they believe price will be above that level. They are bull.
Call writers sell a strike as they are bearish.
End.
See, How Ambuja Has given Movement! Almost 8% in 3 trading days..
