PUT and CALL options

[columbus]

NOV.12 NOVseries Day.12 Nifty=5684 (-2)

In NOV series NIFTY (5D-7U) closed in this fashion:
DUDUUUUUUDDD

Now Expiry zone stands at (5600~5800) once again.

Interesting accumulation/shredding are indicated in YELLOW colour.


Price-wise CALLs are looking strong as of now.

VEGA:

The measurement of an option's sensitivity to changes in the

volatility of the underlying asset. Vega represents the amount that

an option contract's price changes in reaction to a 1% change in

the volatility of the underlying asset. Volatility measures the

amount and speed at which price moves up and down, and is often

based on changes in recent, historical prices in a trading

instrument. Vega changes when there are large price movements

(increased volatility) in the underlying asset, and falls as the

option approaches expiration. Vega is one of a group of Greeks used

in options analysis, and is the only one not represented by a Greek

letter.

COURTESY:investopedia

 

[columbus]

 

[columbus]

NOV.15 NOVseries Day.13 Nifty=5631 (-53)

In NOV series NIFTY (6D-7U) closed in this fashion:
DUDUUUUUUDDDD
[Muharoot Trading FALL is included here]

Now Expiry zone stands at (5500~5700) from (5600~5800).
The zone has started condensing.OI today showed interesting
pattern.In this zone ,CALLS showed addition while PUTs showed shedding.

Interesting accumulation/shredding are indicated in YELLOW colour.

OPEN INTEREST-Interpretation

Open interest is usually used as an indication of the strength of a price
movement, but on its own it does not provide any indication of the direction
of the price movement.


Increasing open interest shows that there is strength behind the current price
movement, and decreasing open interest shows that there is a weakening of
the current price movement. For example, increasing open interest along with
increasing prices indicates that the upward price movement could continue,
but decreasing open interest along with increasing prices indicates that the
upward price movement may be about to reverse.

Open interest is also used to determine if a market is likely to be trending or
range bound (i.e. choppy). Increasing open interest shows that the rate of
new trades is increasing, which indicates that the market is being actively
traded. While decreasing open interest shows that the rate of news trades
is decreasing, which indicates that the market may be entering a time of
less active trading. (Courtesy:daytrading.about.com )

 

[DanPickUp]

Re: NOV.15 NOVseries Day.13 Nifty=5631 (-53)

In NOV series NIFTY (6D-7U) closed in this fashion:
DUDUUUUUUDDDD
[Muharoot Trading FALL is included here]

Now Expiry zone stands at (5500~5700) from (5600~5800).
The zone has started condensing.OI today showed interesting
pattern.In this zone ,CALLS showed addition while PUTs showed shedding.

Interesting accumulation/shredding are indicated in YELLOW colour.

Dear old sailor, as your name always remembers me about an other great Columbus

The following trade I mentioned with out checking your post and how surprisingly, that would match the same range mentioned from you for Nov.

I only had a look at the option prices and had a completely other reasons to come to that conclusion, but it fits your observation. So lets see how it goes:

http://www.traderji.com/trading-dia...ry-strategy-based-phase-1-a-8.html#post740698

Good trading

DanPickUp

 

[columbus]

NOV.16 NOVseries Day.14 Nifty=5574 (-57)

In NOV series NIFTY (7D-7U) closed in this fashion:
DUDUUUUUUDDDDD


Now Expiry zone stands at (5500~5700) for a second day in row.

If no fatal fall/rise is expected ,there is likely hood of EXPIRY taking place at
5600 strike.
Today fall was quite similar to Yesterday's,but the impact is more.

Interesting accumulation/shredding are indicated in YELLOW colour.

Particularly 5500 strike is showing interesting pattern.

5500CE.......+40k(yesterday).......+1305(today).........+1265(net change)
5500PE.......-754(yesterday).........+507(today)..........+1261(net change)

If DAN can throw light on this ,it will be useful to many.




THETA (time decay):
The option's theta is a measurement of the option's time decay.
The theta measures the rate at which options lose their value,
specifically the time value, as the expiration date draws nearer.
Generally expressed as a negative number, the theta of an option
reflects the amount by which the option's value will decrease every day.
(courtesy:theoptionguide.com)

 

[columbus]

NIFTY so far in this series:

 

[columbus]

NOV.19 NOVseries Day.15 Nifty=5571 (-3)

In NOV series NIFTY (8D-7U) closed in this fashion:
DUDUUUUUUDDDDDD


Now Expiry zone stands at (5500~5700) for a third day in row.


Interesting accumulation/shredding are indicated in YELLOW colour.

CALL OI is POSITIVE and PUT OI is negative.May indicate reversal.(personal view).

OPEN INTEREST-Interpretation

Open interest is usually used as an indication of the strength of a price
movement, but on its own it does not provide any indication of the direction
of the price movement.


Increasing open interest shows that there is strength behind the current price
movement, and decreasing open interest shows that there is a weakening of
the current price movement. For example, increasing open interest along with
increasing prices indicates that the upward price movement could continue,
but decreasing open interest along with increasing prices indicates that the
upward price movement may be about to reverse.

Open interest is also used to determine if a market is likely to be trending or
range bound (i.e. choppy). Increasing open interest shows that the rate of
new trades is increasing, which indicates that the market is being actively
traded. While decreasing open interest shows that the rate of news trades
is decreasing, which indicates that the market may be entering a time of
less active trading. (Courtesy:daytrading.about.com

 

[columbus]

NOV.20 NOVseries Day.16 Nifty=5571 (0)

In NOV series NIFTY (8D-7U-1NC) closed in this fashion:
DUDUUUUUUDDDDDD0


Now Expiry zone stands at (5500~5600).
There is no major accumulation/shredding in this zone.
With Majority of players waiting on sidelines ,there is no Major
accumulation/shredding of OI.

 

[columbus]

NOV.21 NOVseries Day.17 Nifty=5614 (43)

In NOV series NIFTY (8D-8U-1NC) closed in this fashion:
DUDUUUUUUDDDDDD0U

edit ,if time permits.

 

[columbus]

NOV.22 NOVseries Day.18 Nifty=5627 (13)

In NOV series NIFTY (8D-9U-1NC) closed in this fashion:
DUDUUUUUUDDDDDD0UU


Now Expiry zone stands at (5600~5700) from (5500~5600).
Major accumulation is seen in 5600PE in this zone.

THETA (time decay):
The option's theta is a measurement of the option's time decay.
The theta measures the rate at which options lose their value,
specifically the time value, as the expiration date draws nearer.
Generally expressed as a negative number, the theta of an option
reflects the amount by which the option's value will decrease every day.
(courtesy:theoptionguide.com)