Meet Ravi, the Derivatives Trader! 🧑‍💼

Ravi loves trading options and is trading on the NSE. He has two types of orders he can place:

Market Orders: Think of this as Ravi being in a hurry to buy or sell. He wants the transaction to happen immediately at the best available price. 🏃‍♂️

Limit Orders: Here, Ravi is a bit more patient. He specifies the price at which he wants to buy or sell. If the market reaches that price, his order will be executed. 📈 How Orders Work on the Exchange

When Ravi places his orders, they go into the exchange, which is like a bustling market. Here’s what happens next:

Market Orders: Ravi’s market order is matched instantly with the best available limit order. For example, if he wants to buy, his order matches with the lowest price someone is willing to sell at.

Limit Orders: Ravi’s limit order sits in the order book, waiting for a matching market order. If Ravi wants to SELL an Option at ₹100, his order will stay there until a buyer agrees to pay ₹100.

Here is an Orderflow chart of the BankNifty from earlier today.

I'll attempt to break the info down for you

The first 30 mins are very important and decide a day

High ask volumes (red on left) indicate strong selling pressure, while bid volumes (green on right) show buying @Vtrender Breaking it down for you:

I have added a few markers also and will talk on them

In the bottom pane, you'll find volume, vpoc, vpoc volume, COT, OI, and DOI.

Let's dive in!

🧵You all know what VWAP is, but did you know it should be used differently depending on the market conditions?

Whether the market is zooming, dropping, or standing still, VWAP can be your roadmap.

Let's dive into how to tailor your VWAP strategy to navigate any market! 📈 What is VWAP?

Volume Weighted Average Price (VWAP) is a trading benchmark used to determine the average price an instrument has traded at throughout the day, based on both volume and price.

It's a vital tool for derivative traders looking to maximize their trades' efficiency.

What is the Options Data suggesting for the weekly expiry of 10th April, 3 working sessions from now?

Let's strip everything aside and look at only the Option Math at work from the renowned traders of Option activity

We will add other elements once this pic is clear I have marked 6 elements on this Option Table ( refer to pic above)

1 is the Series ( let's be clear we are talking wed weekly here )

2 is Range
3 is also Range
4,5 are OI Buildups
6 is The synthetic Future

The most important part of the Option Table is not the OI built, but to find the range of the market

Want to know more about the Volume Profile?

Grab a cup of coffee or a few minutes to read unhindered and I'll walk you through how we use the information from the Volume Profile Q) What is the Volume Profile?

A) An advanced version of the MarketProfile .

Q) What is the MarketProfile

A) First read this and then come back here - vtrender.com/what-is-the-ma…

Price changes perception.

Your view of the price level on a Friday and your view of the same price at the same level on a Monday may be 2 different things.

Prices force you to think differently. In the markets,

Situations change.
Things happen.
Sentiment moves

Prices react.

Let me repeat - Prices REACT

The degree of reaction changes and forces traders who were previously bullish to now go bearish or vice versa

Have you seen this before?

Trading is about You and your system or Process .

A good harmonious You and a great system can do wonders.

But given the same process, 2 different individuals can get many different results, 'cos the "You" is different

This thread is about the "You" in trading

Read on... 1 a] You are born unique and are different.

In trading it is important to know your true self quickly

And act accordingly

Are you aggressive?
Are you patient?
Are you composed?
Can you manage Pressure?

However you are, know your self first

Why should the market pay you?

Trading is a difficult profession and Facts do tell us that 98% of traders do not make money. Nitin from Zerodha has put several tweets on this before

The market does not pay the majority of traders

Why should it pay you?

Read on.. You are a Sachin, Virat, Messi, Ronaldo, Federer, Nadal....

In short you are born gifted and are talented

Something you have done in this lifetime or a previous one is taking care of you

The market will pay you

Read no further..

There is an easy path in the markets for you

We are living in days of high #Vix with added volatility & movement in our favorite indices

There have been strange opens & very quick movements some to profits, others to losses

There is always a message in the data. Data speaks

Let's explore what Vix wants to tell us Vix is at 25- 30 currently.

Is this Normal?

Data from 2010 suggests this as an outlier

A vix above 30 has been trading less than 55 times in 3000 sessions!

It's a 1.83%

On that FII selling tweet, I posted earlier, they started selling aggressively in Oct and it was a foregone conclusion that they would keep selling into March as the hike kicks in.

It's all to do with the adjustment in books.

They have managed through long stock futures also. My view is that we are approaching a selling climax for Fii's now based on the little I know of how these desks operate

I wont be surprised to see a positive FII CASH number in the second half of this month

When i started off in #derivatives #trading, some 15 years back, the "default trade" taught to us was to trade in Futures or to BUY calls or BUY puts as the need arose.

These days the "default trade" is to SELL calls and SELL puts. Thanks to a spurt in online education, you learn quickly to sell options at 09.25 am and at 12.30 pm and every time of the year.

No education is provided for things like VIX, directional volatility, IV smiles or even basic gamma math

👀👀

"tape needs a bounce to 16770"

https://twitter.com/Am_Shai/status/1496775670860431372

For the record, tweet was posted near 3.00 pm and a follow up was also done post close where I clearly mentioned there was no selling visible in the last 30 mins of the day

A lot of #OpenInterest traders will look at the high #OI of today in Futures

The #Nifty F addition was 30458 contracts, a high for the series of Jan

The #Banknifty futures addition was 6265 contracts today, not a high but big.

A quick thread on why this is a half- truth. The futures market of today is just a fraction of the Options market.

Any day the options market beats the Index Futures 100 times & easy.

So if you are only looking at Futures Open Interest , you are reading just 1/100 th of the market

as mentioned previously , have not been trading overnight positions and happy with all the volatility and the massive intra day swings.

This is excellent for trading .

For the swing, of interest to me is the lows in #Nifty of today right at the channel of importance at 16980 There hasn't been buying in the #Orderflow for quite a while.

Was watching 17700 earlier last week and that did not show any buying.

This is a snippet from our room

A lot of people watch the #SGX pre and post close , and I know whatsapp and telegram groups are always focussed on the #Sgxnifty moves post our close.

New guys think what happens on SGX gets carried to Nifty next day .

Misconception NO 1. Most SGX traders are short term traders and capitalise and close gains within hours.

This is the reason you won't see a follow through at the open. They are fixated on the global front and if that changes they move out.

The added hours help them to do so.

It's the weekend and time for a thread.

I would like to share my views on #Trading and #Investing.

I see a synergy in the 2, fully aware that there are radical and often polar opposite views for both trading and investing. Most traders diss investors and most investors do not think kindly of traders.

Investors talk in terms of wealth creating and urge you to invest savings etc in investing. Those who do so end up with the "good life" at 65-70 with no friends to share the riches with.

It's the weekend & I'd like to share with you a money making strategy in the #MarketProfile approach to trading the markets

And No ! I won't ask you to grab a cup of coffee & read this

Weekends are for more than coffee :)

But do take notes. There is a definite edge in this First and foremost, to all who are new to the #MarketProfile- (MP) is a robust system of trading which involves Price, Time + Volume- 3 parameters

All 3 together, hence a bigger edge to us as traders

You can start reading about the #MarketProfile at - vtrender.com/what-is-the-ma…

#35500 call #dukaan

sl at 185 tgt 310 265 bookd half

I work with candle sticks also. They are present in all my #Orderflow charts  and I have them plotted to the left of my charts .

This disclaimer to all who think I do not use candle sticks and bars.

I repeat they are present in all my charts, even my #Orderflow charts. But for intra-day , if you are using 5 mins and 15 mins or even 30 mins and using them to make decisions, you are at a big disadvantage.

Allow me to explain. I'll take a few minutes

Around the last week of October I was aware of 2 big conferences which would bring together a lot of new traders, & a few struggling ones, & I had made up my mind to speak at one of these on #MarketProfile and using the message of the market well, to stay ahead of the curve(1/n) It was a choice for me, and I wanted to offer my time to the one who first came to me. Of the two, TC had built a reputation for conducting these events, and DE was a new kid on the block with people who had previously worked with TC. So there was no choice between the 2 actually