Rajandran R Founder of Marketcalls and Co-Founder Algomojo. Full-Time Derivative Trader. Expert in Designing Trading Systems (Amibroker, Ninjatrader, Metatrader, Python, Pinescript). Trading the markets since 2006. Mentoring Traders on Trading System Designing, Market Profile, Orderflow and Trade Automation.

Extreme Indications in Nifty Weekly Timeframe – Sign of Caution for Late Shorts

39 sec read

Nifty spot bounced of from 3rd Standard deviation extreme band signs of caution for positional shorts out there as it historically indicates a kind of oversold markets with a greater odds of a bounce back in the short to medium term. Lack of sellers confidence is an opportunity to fade those sellers in a very short term. Current extreme indications come around -7.4.

Nifty Weekly Timeframe

There might be too many late laggard shorts in the system. Any flush out of such shorts are the real sign of tide is turning on the upper side. However, playing on the upper side is still tougher if you are naked option player as even if you are right with your directional view you might lose on the volatility. In that case it is not recommended to play with Out of the money options. It is better to stick to At the money strike with very short-term longs rather than getting caught with the volatility crush! (if any)

Bank Nifty also showing similar signs of bounce back from extreme indication zone.

Bank Nifty Weekly Timeframe

Rajandran R Founder of Marketcalls and Co-Founder Algomojo. Full-Time Derivative Trader. Expert in Designing Trading Systems (Amibroker, Ninjatrader, Metatrader, Python, Pinescript). Trading the markets since 2006. Mentoring Traders on Trading System Designing, Market Profile, Orderflow and Trade Automation.

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5 Replies to “Extreme Indications in Nifty Weekly Timeframe – Sign of…”

  1. hi Rajendran, thanks for your post. Are the red and green bands in the above charts some ATR / volatility based bands?

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