Sector Selection Simplified: Finding Winning Trades in Any Market
The approach to effective options trading in Indian stock markets, could be to spot the sectors in Indian markets which are in an effective positive or negative price and open interest cycle.
As option traders are aware that the price change which is substantiated by effective OI participation tends to be persistent and more an effective rally than price action which isn’t supported by OI participation.
Open Interest is one of those key data points in futures and options trading that holds a lot of analytical information. This data can be used to identify not only the extent of participation but also trend of the underlying adding on to the price behaviour.
In this video we have tried to explain the Built-up cycle. Open Interest of Futures is analyzed to come up with an approach to avoid small perturbation and focus on the broad, emanating trend; trends that are likely to persist and not a flash in the pan kind of approach.
PGDM in finance, having 5+ experience in Equity, commodities , forex analysis and trading.
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