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Mastering Option Chain Guide

This guide provides a step-by-step plan to master the Option Chain, focusing on key concepts such as strike price, open interest, and implied volatility. It emphasizes the use of open interest for identifying support and resistance, as well as strategies for intraday and swing trading. Additionally, it suggests tools for practice and resources for further learning, encouraging daily practice to enhance trading skills.

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rajy27733
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2K views2 pages

Mastering Option Chain Guide

This guide provides a step-by-step plan to master the Option Chain, focusing on key concepts such as strike price, open interest, and implied volatility. It emphasizes the use of open interest for identifying support and resistance, as well as strategies for intraday and swing trading. Additionally, it suggests tools for practice and resources for further learning, encouraging daily practice to enhance trading skills.

Uploaded by

rajy27733
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Mastering the Option Chain: A Complete Guide

Step-by-Step Plan to Master Option Chain:

1. Understand the Structure:

- Strike Price, Call (CE) vs Put (PE), Premium (LTP), Open Interest (OI), Change in OI, Volume,

Implied Volatility (IV).

- Tip: Start with Nifty 50 or Bank Nifty Option Chain (NSE India or Sensibull).

2. Learn What Open Interest Tells You:

- OI = Active contracts. Use it to identify support/resistance.

- OI + Price Action Combinations:

- Price + OI = Long Buildup

- Price + OI = Short Buildup

- Price + OI = Short Covering

- Price + OI = Long Unwinding

3. Use Option Chain for Intraday & Swing Trades:

- Max Pain = Expiry magnet.

- Look for OI shifting to new strikes = breakout/breakdown clue.

- Compare todays OI change vs previous day.

4. Tools to Practice:

- NSE India Option Chain

- Sensibull (Free & Paid)

- Opstra (by DefineEdge)


- StockMock (for backtesting)

- TradingView (for charts + OI zones)

5. Daily Practice Plan (15 mins/day):

- Morning (Pre-open): Check OI buildup.

- Midday: Confirm levels and changes.

- EOD: Review if OI levels were respected.

6. Learn from:

- YouTube: TradeWithTrend, Market Secrets, CA Rachana Ranade

- Books: Option Chain Simplified, Options Made Easy by Guy Cohen

This is your roadmap to mastering the Option Chain and trading with confidence.

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