Along with the levels, there is Trend Ratio.
Near 1 or below is bearish, near 2 or above is bullish
( this as per last day's closing).
If Trend Ratio is bullish, expect support at Balance or breakout above Upper level will mean rally will continue.

If Trend Ratio is bearish, look for break or Balance or lower levels .

On a bullish Trend Ratio if Balance breaks, expect all longs to be trapped . Can short with stop above upper breakout figure. And vice versa
Normally the Trend Ratios of both indices are in sync, a little bit of difference. But here BNF is bullish while Nifty is bearish. So, if playing bullish tomorrow concentrate on BNF, If playing bearish, concentrate on Nifty
Major Rule :
1. DO NOT play bearish is market above Balance
2. DO NOT play bullish is market below Balance

The Balance basically tells you which side is a bit trapped
As long as the market stays within the upper and lower levels, option sellers ( whether they have sold on friday or will sell tomorrow) are at an advantageous position and make money. Whichever side this level is broken, that side sellers will be trapped
This is how I will view the market tomorrow :

Nifty fut : Has closed on Friday below the Balance for Monday. So if Nifty opens a little below, will go short with a stop above Balance. Below lower levels will short more
BNF : Will look to jump in and buy if BNF crosses 38041. Else will wait for Balance to be checked, if there are signs of rebound, will go long with stop below Balance
Again, normally these levels are in sync. It's not often two indices show opposing views . So will trade a bit carefully tomorrow

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This friend had trouble making money in options though he was directionally right. Let us see how a basic understanding of greeks would have helped him, This thread will be about two attributes of option pricing, extrinsic value and theta


An option has two parts, intrinsic and extrinsic value. Think of a pack of Lay's potato chips. When you buy and open the pack, what you find is some chips and a lot of air. Intrinsic value is the chips, extrinsic value is air


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This is actually an interesting question and a correct observation. Many people before you also have made this observation, so I am going to explain this the best I can


I am trading since badla days. There being long meant you had to pay badla / interest and being short meant you received badla. Similar to an options buyer having theta burn and an options seller being theta positive. So the bias among pros were being short bit

Now, as of now I am an options buyer. All my strategies are geared towards options buying, so I have a theta burn continuosly. I do use strategies to cover that a bit, but still the burn is there

Now, let's consider how an options buyer makes money. His enemy is theta, vega can be friend or enemy ( coming to this in next tweet) , Delta is whether his view is right or wrong

Now say I am bullish on BNF and I buy calls and I am directionally correct . As BNF goes up, generally IV will decrease. This leads to a double whammy.
1. Vega hurts me
2. Theta decay increases.
So, the position does give money, but slowly

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