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alex_laxya

MP for NSE INDEX AND OPTIONS

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nfweeklyandhourly050309.png

w974.png

 

As mentioned in last post market profile is looking very bearish establishing new lower value areas daily, even rate cuts wont able to boost the prices.This is where MP comes handy, MP allows to see what market is actually telling and help us not to mix our own feelings/impulse to the information.

As mentioned before, trying to add the angle of VIX and option open interest put call ratio in next post ..heading for break ..

Alex

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I think you cant edit your post after some time... just found i accidentally posted the wrong chart on post no. 25...correct chart shows in post no. 26

Request to moderator, plz delete my post no.25..meanwhile plz ignore that post...

sorry for confusion

Alex

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I think you cant edit your post after some time... just found i accidentally posted the wrong chart on post no. 25...correct chart shows in post no. 26

Request to moderator, plz delete my post no.25..meanwhile plz ignore that post...

sorry for confusion

Alex

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Time, price,volume and 4th factor

Lets start from the very foundation of market profile ..

who are the auction partcipants ?

. Local market makers

. Day traders

. Intermediate-swing traders

. Long time frame traders

 

This auction create market-generated information, auction organize and reflect the attitudes of the market's partcipants,thus creating market-generated information.

The key to reading market-generated information is

.Time

.Price

.Volume

This i sthe primary tool of market profile

now there is another time of auction involved ..auction of option buying and option selling..

option sellers are considered as Smart Money, though there r verious contradictory theories, lets not get in to this,

but Indian market is special in this sense, option market hasnt yet developed and there r normally in the month options are liquid and those only of nifty index,

there is still attraction of quick money among this high volatility ( vix)

higher vix means greater fear which by standard mathematical model increase the option premium

This option induced data is very meangful when look in to context of market profile, i am not a great reader of volume distribution but i found option induced information very profitable in my trading...

there ant any secrets in trading and nor i intend to have one, its about the art and how u adjust ur knowledge to earn money, which come by practice..

In this thread, now and then i will try to explain market profile using 4th factor/ dimension as option open interest

i assume every one knows te calculations of option open interest put call ratio which i extensively use in my trades..

here is the chart explaining todays activity ( plz note o.i.pcr is daily ) ..there is a build up of 92 lk o.i. around 2500 pe ( not shown in chart ) and this build up is since last few days, but still oi pcr is decreasing which indicates there is call writing ahppening around resistance zone or u can say most strong value areas,

If 2500 nifty broke ( which we proved mathematically an important psychological area) then there wd be heavy selling from other time frames.

 

vix050309205827.png

w961.png

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060309161026.png

w975.png

 

Elongated profile with steady distribution, usually such kind of profile is healthy and indicates strength but volume is an issue, b'cuz of sun outage few brokers facing connectivity issues

2500 pe witnessed large activity, o.i. jumped by 12 lk which is again indicates the strength.

Best wishes for weekend

Alex

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I am not a follower of Elliott Wave theory but BSE's SENSEX (weekly) chart caught my eye for EW formation.

 

Here is SENSEX chart with Elliott Wave and Parabolic Arc pattern. Look for the Symmetry in Wave 3, Wave 5 lengths. Also, Parabolic Arc pattern retraced to 62% of the entire prior move.. Could correct more??

 

** This chart is not MP based chart, but I thought it may be pertinent Indian Markets chart that I follow. **

 

Regards,

Suri

BSE_M_Mar0609.thumb.gif.5a540f30ae2d5381d3c5d41bf610dbe6.gif

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Hi,

didnt able to post last night, got bz with few things so pardon me ..

To understand the market perfectly yesterday's Market Profile is very important, especially if you are a day trader, it gives a referral point..here is the list of to do list to prepare for next day market open, as said in first post there are no shortcuts to understand the principal -how market behaves -in contextualize way.

 

1>Review yesterday’s profile for clues as to what to expect today. Make

a note of possible trades, based on varying developments.

 

2> Review the overnight markets for any unusual price movement or

early indications for the day.

 

3> Compare the expected opening to the previous day. Is it within or outside

the previous day’s range? Value area? To the upside or downside?

 

4> Relative to the expected opening, identify three references points,

both above and below the expected opening. These could be the

previous day’s high and low, weekly high or low, the top and bottom

of the previous day’s value area, or the high or low of a recent trading

range. (There is no set answer—you should be guided by your past observations

of where price slowed or accelerated, as well as past areas

of heavy or light volume.)

 

5> Note what kind of opening is occurring, as well as what you’d want to

see in order to quickly judge the resulting directional confidence.

 

6> Note whether or not there is clear attempted direction, and whether

that activity is supported by volume.

 

7> Does the market appear to be within balance or out of balance?

 

8> Visualize the remainder of the day. Will it look elongated, squat, fairly

normal like a bell-shaped curve, and the like. Note any unusual shapes

or patterns that may suggest something unexpected is happening.

 

9> Estimate how much effort is being expended to move price directionally,

and note what that suggests about the inventory conditions of

your competitors—too long, too short, above water, below water, etc.

 

10> If there is a major news announcement scheduled, be aware that there

could be unexpected volatility. Let the market provide short-term interpretation

of resulting activity by observing developing structure.

 

Unless the day-timeframe structure is extremely strong and unlikely

to be reversed by such an announcement, we recommend that day

traders be flat in front of significant numbers.

 

trading of NIFTY starts at 6.30 AM(IST) on singapore exchange.Have you tried to check it as it is going to be important in predict expected open as mentioned in your post.

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Hi

 

I just finished a PHP Market Profile Chart. It is free to use and plots 20 days of 30 minute MetaStock formated data. I also plot clear candle sticks right over the Market Profile data so you can see what really happened in the candle.

 

 

http://www.trading-seminar.com-> Indicators -> Market Profile.

 

 

thanks

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