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SGX Nifty: Nifty Trader

High PCR means the market is bullish because the option writers are inclined to write puts. Low PCR means bearish sentiment – because option writers are not willing to write puts but instead write calls.<br>

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SGX Nifty: Nifty Trader

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  1. What is SGX Nifty? SGX Nifty, also known as a Singapore Nifty, involves taking position in the Singapore Exchange on Futures contracts . The Futures contracts settlement is based on the NIFTY settlement price in the Indian stock exchange NSE. This gives international investors the flexibility of betting on Indian markets without having to setup or register the entity with the Indian authorities. Singapore exchange is the leading exchange of Asia allowing investors to take positions in different products based on the futures which are traded on the exchange. Apart from India the exchange also allows one to take positions in FTSE, China A50 index, MSCI Asia, MSCI Hongkong, MSCI Singapore, MSCI Taiwan ,Nikkei 225, Strait Times etc.

  2. Advantages of SGX nifty • The Nifty has the highest liquidity both in the case of futures and options categories. High liquidity makes it easy for investors to easily enter or exit their positions. • Stocks can drop 30%-50% in a single day as it doesn't have any filters. On the other side, Nifty rarely have fallen more than 5%. Traders who positioned in Nifty have a much lower risk as compared to stock traders. • For individual stocks, an investor has to track the company’s developments closely. A close eye has to be kept on the sector, because many times, due to technological advances, a whole sector suffers.

  3. Put Call Ratio Tracker • High PCR means the market is bullish because the option writers are inclined to write puts. Low PCR means bearish sentiment – because option writers are not willing to write puts but instead write calls. • The put-call ratio (PCR) is a popular tool specifically designed to gauge the overall sentiment (mood) of the market. The ratio is calculated by dividing the number of traded put options by the number of traded call options. As this ratio increases, it can be interpreted to mean that the investors are putting their money into put options rather than call options. • An increase in traded put options signals that investors are either starting to speculate that the market will move lower, or starting to hedge their portfolios in case of a sell-off.

  4. Why should a trader bother about PCR and Nifty Open Interest? • The put-call ratio (PCR) is primarily used by traders as a contrarian indicator when the values reach relatively extreme levels. This means that many traders will consider a large ratio a sign of a buying opportunity because they believe that the market holds an unjustified bearish sentiment and it will adjust to normal soon, once the short covering begins. Unfortunately, there is no magic number that indicates that the market has created a bottom or a top, but generally traders will anticipate this by looking for spikes in the ratio or for when the ratio reaches levels that are outside of the normal trading range. • An increasing ratio is a clear indication that investors are starting to move toward instruments that gain when prices decline rather than when they rise. Since the number of call options is found in the denominator of the ratio, a reduction in the number of traded calls will result in an increase in the value of the ratio. This is significant because the market is indicating that it is starting to dampen its bullish outlook. • Regarding Nifty Open Interest, it provides good support and resistance levels for the series. Traders usually look for Nifty Open interest highest OI strikes. These strikes are important to determine support and resistance.

  5. Helpful Tools to be used in trading • Pivot CalculatorGet daily pivot values for most popular Nifty stocks. Use these tools to make your Nifty technical analysis much easier. This tool features Standard pivot points, Camarilla pivot points, Woodie’s Pivot points and Demark Pivot Points and displays all in one single view for ease of traders. The data is updated everyday.Use these One-in-All Pivot Point Calculator to identify Support and Resistance of Nifty and other major NSE stocks. • Fibonacci CalculatorKeep Track of multiple retracement level with this completely customizable Fibonacci Calculator. You can track upto 4 retracement levels and even change retracement percentages.This calculator lets you keep track of important Support and Resistance for Nifty and any other stock. Just key in High, Low values and you get important Fibonacci Support/Resistance numbers. • Advanced Fibonacci CalculatorKeep Track of multiple retracement level with this completely customizable Fibonacci Calculator. You can track upto 4 retracement levels and even change retracement percentages. Advanced features help you to identify the next Support & Resistance levels based on your filters. It will calculate (and display) all the important levels and highlight the levels that meet your filter criteria.

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