Spot chart vs future chart?

F&O
1

There is a slight difference in the price of the spot and futures chart, because of the pricing formula of the future of the underlying asset.

But,

  1. Which is used for technical analysis, spot or future chart ,to trade as the price levels are not same…specially in case of nifty and bank nifty?

  2. To trade in options which is more preferable to use spot chart or the option chart of the underlying?

Your replies can make wonders :pray::pray::pray::pray:
@ShubhS9 @siva

1 Like
2

Nope. Your study can!

Who fed you this BS? As with each and every field. Forget about the theory. Futures prices are determined by Supply, Demand, sentiments only.

Any one you like. No much difference. Just stick to your choices

Most use spot charts. But some pro traders I know swear by TA on options charts directly.

1 Like
3

In theory-> Spot price derives ->Futures derives->Options
In practice-> Options derives->Future derives->Spot price

1 Like
4

WRONG.

1st is theory, 2nd is alternate theory.
In reality - Sab apni marzi ke malik hai"!!

We are left to analyze and draw conclusions as post facto.

6

You know nothing Jons snow :stuck_out_tongue:

Its Money which is blood,heart,brain,soul of the market. Biggest market (100% true for index and is relative in stock by stock) is Options then future then cash.And thats how prices and levels are focused on!! More the money in particular instrument more powerful it is!!!

1 Like
7

If options decide the prices then there wouldn’t have been Short Coverings or Long unwindings ever.

Answer below and I will accept your argument.

  1. Largest CE OI is at 13450.
  2. There has been continuous addition of CE OI at the same strike for last 3-4 days.
  3. CE prices are relatively not increasing in tandem with the rise in index.
  4. On the other hand PEs have low OI and not much addition.
  5. Overall OTM CE OIs are much much more than OTM PE OIs.

LTP is 13445.

Now tell me what will index do from here?

8

Within moment when someone place a ‘Sell Market order’ price of that instrument will drop = 1st Bid price . If someone place ‘Buy Market order’ price of that instrument will increase= 1st offer price.

Markets are positionally variable of time at instance. Future Price is function of time and non deterministic order info as variables.

If only you can provide me future deterministic variables like complete info of order flows price can’t be determined. All the points you mentioned cannot determine future price as they are variables of time , so the info is useless.

9

Just like your theories.
:rofl:

You initially put in the theory which as per you can determine the future prices of instruments.
Your sole variable being money deployed in the instrument.

And here you are now talking about “non deterministic order info as variables.”

10

I never mentioned that i can determine future price , no one can do that !! Its not worth to explain the abstracts to a person who misread and has preconceive beliefs and notions ,so i rest here!!

11

You should have rested from the start bro. Why open ones mouth if know nothing.

And when did even I mentioned that? I said that you said that your theory can derive future prices of instruments.

No No No NO.
I am all ears. Plz convert me.

12

I was thinking of discussing the same topic , I am sad this conversation went beyond the subject of discussion :roll_eyes:

My own observation tells that Future charts are good for managing stop loss / trailing stop loss otherwise you have to be careful with the Spread ( difference b/w spot vs Fut price) , apart from that it totally depends on your way of trading like if you are a price action trader then I think it doesn’t make a difference which one you follow but I am not sure of VOLUME PRICE ANALYSIS

I would really appreciate if someone with more experience in this regard enlightens me I would be thankful. :blush:

1 Like