A small thread on the importance of using log charts:

Rs 100 of 1990 is not comparable with Rs 100 of 2021 in absolute terms

Similarly, price of a stock some years back may not be comparable with today's price in absolute terms.
For EG, SBI quoting at Rs 10 in 2002 is not comparable with SBI quoting at Rs 400 now

For a 100% jump in 2002, stock would have to reach 20 (which is just Rs 10 in absolute terms)

While today, Rs 10 in absolute terms is a meagre 2-3% move
We shall always calculate moves in % terms

For this reason it's preferred to use log charts, especially long term charts

Log charts calculate moves in % terms
Also, if a stock goes from 20 to 200 in one year, even then it's preferred to use log charts.

More from Prashant Bhansali

#RIL tgts are 2180 and 1820 positional over next few months if the high made at 2856 doesn't cross.

Not looking good.

You May Also Like

MASTER THREAD on Short Strangles.

Curated the best tweets from the best traders who are exceptional at managing strangles.

• Positional Strangles
• Intraday Strangles
• Position Sizing
• How to do Adjustments
• Plenty of Examples
• When to avoid
• Exit Criteria

How to sell Strangles in weekly expiry as explained by boss himself. @Mitesh_Engr

• When to sell
• How to do Adjustments
• Exit


Beautiful explanation on positional option selling by @Mitesh_Engr
Sir on how to sell low premium strangles yourself without paying anyone. This is a free mini course in


1st Live example of managing a strangle by Mitesh Sir. @Mitesh_Engr

• Sold Strangles 20% cap used
• Added 20% cap more when in profit
• Booked profitable leg and rolled up
• Kept rolling up profitable leg
• Booked loss in calls
• Sold only


2nd example by @Mitesh_Engr Sir on converting a directional trade into strangles. Option Sellers can use this for consistent profit.

• Identified a reversal and sold puts

• Puts decayed a lot

• When achieved 2% profit through puts then sold