iCharts Discussions

[shekharinvest]

[vinay28]

US can not default because their constitution demands that an agreement is reached on all matters. Hence, if it is not reached, all senate and congress leaders are liable for arrest and imprisonment for disobeying the constitution.

[pkholla]

Events are fast catching up with the US!
China is busy negotiating deals involving its currency and the local currency of trade partner. Eg, Saudi Arabia and China recently inked a S Rial- Yuan pact. Foolishly, US itself is forcing many trades to be negotiated outside US dollar. Eg India purchases of Irani oil are paid with Rupees.
Shortly we will have sophisticated swaps (arranged by savvy US financial wizards!) where the partners will conveniently leave out USD and base the settlement on the value of a basket of currencies
Still our FinMin is mainly keeping reserves in USD. At last, when bottom falls out of $, our noble Chiddu et al will wake up from Kumbakarna sleep and use their dollar reserves to paper the South Block Loo walls

[yashrahul]

17/10/2013

HIGHEST OPEN INTEREST IN PUT:5700PE =68,67,400.

HIGHEST OPEN INTEREST IN CALL:6200 CE =51,88,200.

Note:highest oi is still in 5700 pe but premium has come down too much,notable is the addition 6,08,550 in oi in 6000 pe,6300 ce oi is now taken over by 6200 ce oi,slight shift lower of 100 points on options is visible with 6300 ce being taken over by 6200 ce,writers have eaten of most the premium of otm puts and now it seems have started eating itm calls and otm calls as well.

[yashrahul]

It seems last leg of the rally is coming in full force.....atleast options data indicates so....6000 pe has added 7,19,450....6100 pe has added 17,02,700.....6200 pe has added 10,92,450(in the money put)...put writers are more than 100% sure that markets are not going to go down...not even 100 points on the nifty is what they feel...lets see....only time will tell and so will Futures and options expiry...diwali at new high or close to new high...why...5 state elections....election year...

[yashrahul]

wow..what confidence shown by the bulls...since my last post 20 or 25 minutes back..just see the change....6100 pe has now added 18,89,300.. 25 minutes back it was 17,02,700 .....6200 pe has added 1,516,500..25 minutes back it was 10,92,450(in the money put).

[yashrahul]

18/10/2013

HIGHEST OPEN INTEREST IN PUT:5700PE =64,00,000.

SECOND HIGHEST OPEN INTEREST IN PUT:6000 PE=61,78,250

HIGHEST OPEN INTEREST IN CALL:6300 CE =48,41,600.

Note:Diwali at a new high is what options data is suggesting...still 10 days or more to go to expiry but options data is suggesting that we are well on our way..look at this...heavy put writing in 6100 pe...18,45,950 added in oi...6200 pe which is in the money put...16,45,200 added in oi...whether the upward trajectory path is clear can be gauged by this ...maximum call oi was at 6200 ce and today huge oi cut in 6200 ce ...-8,11,300...word of caution..some days back they said 4800 on the nifty by year end....now they will say 6800 nifty by year end...profits are profits when they are in your pockets and not on paper(my personal view)...take the advice from experts on icharts or from anybody you consider to be one and keep on booking your profits

[ca.krishna]

Hi Yashrahul,

I am new to this and not a regular trader so Can you please explain this strategy....why market should go up when more qty is added in put.

Is that means when more qty is added in call then market should go down. and whether it is linked to timming of purchase also.

Thanks!

[yashrahul]

Hi Ca.Krishna...it is difficult to explain in short... i will have to write very extensively but in a very very simple way...large domestic institutions and Fiis generally short sell or buy(very very rarely) the calls and the puts in very huge quantities to eat the premium of those calls and puts(when they write ..premium gets eroded... premium never gets eroded but appreciates when they buy which is very very rare.they generally donot buy they either short call or put)..when these calls and pulls are bought or sold there is an huge addition or subtraction at that particular strike price known as open interest of that strike price..when the open interest is very high for ex:now at 12.28 in the afternoon 5700 pe has highest oi(short form for open interest)61,24,150 but the premium value is very low it is immediately followed by 6000 pe which has 57,65,350. now the market is trying to make a base at 6000 pe and 6300 ce as highest oi at 49,83,700 so the top is somewhere round these levels..these are the 2 levels as of now where traders feel the markets are going to end in october expiry in between 6000 to 6300.

For example only:
Now the problem arises when either of this level gets challenged in the coming 10 days or so left for expiry...suppose there is a gap down of 150 points on nifty due to some untoward incident then the 6000 pe which was sold by institutions they have to start buying and hence the market starts opening up on the down side similarly something very very very positive happens and the market opens 150 points gap up then those institutions which have written 6300 ce have to start unwinding there positions and the market opens up on the upside.

You can search on the internet ca.Krishna and you will find all the information...you can always ask me on my thread whenever u have any doubt..the problem is options data is very vague and it will never give u the exact picture... it is just to understand the trend..sometimes even that becomes difficult when the market is very volatile as the oi keeps on changing very fast.. i will help you in whatever knowledge i can give you but don't ever take any positions on options open interest because when the trend changes or volatility increases a lot or during end of the month open interest in options changes very rapidly..ask the experts they will guide you in a better way..i will try my level best in explaining as much as i can.

[yashrahul]

21/10/2013

HIGHEST OPEN INTEREST IN PUT:5700PE =60,14,450.

SECOND HIGHEST OPEN INTEREST IN PUT:6000 PE=56,23,850.

THIRD HIGHEST OPEN INTEREST IN PUT:6100 PE=54,82,400.


HIGHEST OPEN INTEREST IN CALL:6300 CE =52,09,650.

Note:The reason i have mentioned oi in 3 different puts is 6100 pe is about to takeover from 6000 pe as the second highest oi in put and 5700 pe has lost most of its premium but since it holds the highest oi i have to mention about 5700 put.Interesting to note that 6100 pe has added 9,06,250 today...it means bulls are showing no mercy and are damn sure that the market is not going down hence continuous writing is going on even in 6100 pe...6300 ce has also shown addition in oi of 4,57,350 but the call is being written or not i have my own doubts....markets right now are behaving like an advertisement which was famous many years ago..do u remember this advertise "PAKDE REHNA....CHODNA NAHI"

[ca.krishna]

Dear Yashrahul,

It is really very complex and you explained it very well. Thanks a lot for for your answer.

krishna

[yashrahul]

Thanks ca,krishna

[yashrahul]

Thanks Ca.Krishna once more.

[vinay28]

writing hindi sentence in english can be highly embarassing and needs to be done with restraint!

[ca.krishna]

Excellent Vinay Bhai....ur observation and notice skill is too high.