Understanding NSE: CHAMBLFERT Price Surge with Modified OI-PCR
· 03.05.2024 · 15:30:32 ··· ··· Friday ·· 5 (5)
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In this video, we explore a method for identifying advantageous moves in the futures market of an underlying asset, such as indices like Nifty or BankNifty in the Indian stock markets, as well as any stocks within the NSE: F&O segment. The strategy we discuss focusses on the Modified Open Interest Put-Call Ratio (Modified OI-PCR).
Before we dive into the specifics of OI-PCR and its modified variant, it's crucial to understand the concept of open interest. Open interest represents the total number of outstanding options contracts for a specific underlying like Nifty, BankNifty etc., or stocks as underlying in NSE: F&O segment. This metric is highly significant in options trading, serving as a key tool for traders to gauge market sentiment and predict potential price fluctuations.
OI-PCR, or Open Interest Put-Call Ratio, is an effective indicator utilized by options traders. It is calculated by dividing the open interest of put options by the open interest of call options.
OI PCR compares the number of open put options to open call options. A comparative metric, in essence!
OI PCR = Open Interest of Put Options / Open Interest of Call Options.
A rising OI PCR indicates that more Puts are being sold than Calls, signaling a bullish trend. Conversely, a decreasing OI PCR suggests that more Calls are being sold than Puts, signaling a bearish trend.
However, here's the twist: with the modified OI-PCR, a premium-weighted version of OI-PCR, a more effective and nuanced approach to options buying emerges, allowing for better identification of directional cues in the short term.
At Quantsapp, its our constant endeavour to equip retail option and derivative traders in India with analytics which are simplified for ease of use; yet, effective and efficient in options trading strategy formulation. Quantsapp enables use of derivative data in a more effective manner helping derivative traders in Indian stock markets to be data driven, than rely on gut feel.
Be a data-driven trader!
In this video:
00:00 Discussion and differences of OI-PCR and Modified OI-PCR
03:50 Quantsapp OI-PCR tool : A brief introduction
04:40 Recent case study of NSE:CHAMBLFERT
06:29 Summary and closing remarks
New To Quantsapp?
New Users Use Code: QAPP
Get 20+ Free Option Trading Tools
Signup here: https://web.quantsapp.com/?s=y
Download App: https://app.quantsapp.com/sr
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