- From this Monday Nifty 23300 puts was written hugely. Whenever Nifty dipped below 23300, FIIs bought hugely never letting it go significantly below.
- US markets were down 3% yesterday.
- Yesterday’s OI clearly showed client was shorting Calls: Sensibull - India’s Largest Options Trading Platform The best way to screw clients is by increasing Nifty today.
- All news suggested a weak open. It opened flat with barely any dip relative to US markets
- Today, as a clear example, if you spot 23500CE
- Nifty had 2 tops in the first 2 hour(Second top - marked yellow)
- 23500CE (shown below Nifty) also had 2 tops.
- But before Nifty crossed the second top, the 23500CE already crossed the previous top at 11:12 with no other triggers: no news, no underlying Nifty movement etc
- Nothing is new today, but we are up by 300+ points as of this writing
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Options move before spot. With the way options premium was moving in the first hour, it was evident we were going above 23500. But yeah I didn’t expect 23800. But that’s mainly because of dominos effect of short covering 23500ce then 23600ce then 23700ce and finally 23800ce.
There is no scam. Fno is a zero sum game. Somebody has to lose for somebody to gain. Big players always try to trap the smaller ones.
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This 
@BB789 If I had $1B to invest I too would take up derivative position in advance of my large purchase. Could this be called manipulation when it’s just normal trading? 
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there are so many rumors of insider trading the news after the tarrifs
It’s normal to blame others when markets don’t move as per your analysis.
I too lost when we opened 1000 points down last Monday. Who is to be blamed? I am only responsible for taking such overnight exposure.
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Why do Options move before spot? Unless you’re planning to buy options before moving the index? How is this different from pump and dump?
I don’t think today;s expiry is manipulated , today was a trending day , i too had 23400CE which was in water in the morning session but hold it , from last 2 days market was in a narrow range ,
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It always moves before spot. Spot plays catching up with Fno.
I can always tell which way spot is moving in next 1 min. But that’s of no use because options have already priced that in a min back.
In theory, options move based on underlying. But practically 9 out of 10 times, options move first and then the spot.
Now this is just my observation based on my market experience.
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Notice how both the first and the second top in CE did not form a new high before NIFTY in my image. The 3m timeline clearly shows they form the top at the same time(Yellow arrow). The third breakout candle in CE(red arrow) overtook the second top well before NIFTY overtook the second top(Red arrow) - to be exact, at least 3 minutes before, i.e., At least 3 minutes before buying NIFTY, someone(Or many insiders) knew that this candle won’t retrace or reverse and that they’re going to make new highs.
In general, Options follow the underlying(like the first and second top) not otherwise. If it clearly moves otherwise, then it is manipulation.
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That’s not true. You are sticking to theory too much and not digging deeper market dynamics. Options can move before spot because -
- Options are forward looking
- Options price in expectations
- Options have direction (CE/PE)
And essentially their pricing mechanism has this variable parameter called IV which can price in any upcoming news, event or technical setup. That isn’t manipulation.
For example, a court order is due that can make or break the stock. The price of the stock is stagnant. Still just before the court order IV will increase and both CE and PE will increase due to the expected move. That isn’t manipulation.
P.S. Today was a classic cup-n-handle or flag breaking up on the upside. Anyone doing technical analysis would have expected an upside (at your red arrow) reflecting in CE price / CE IV before the actual move.
Hope this helps.
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Theory theory theory.
So is your opinion. If you truly think options move first, a 1m lead, it should’ve shown in the charts. But except for this outlier, options follow the spot. If you have repeated sample charts proving your theory, do show it.
Here in this case, it was a 3m lead and it wasn’t just that the underlying move priced in - it was preparing for a huge upmove after that. So buying had a great reward risk ratio.
Ofc option prices move with spot, why would they not. The point is that it can be both, before and after, depending on the momentum. Also how overnight options open and move in the opening minutes often signifies something, and like @abhiwin123 mentioned, IV (events, fear) can balloon options pricing before spot moves.
@abhiwin123 (and @VijayNair) While I agree that fundamentals have an effect on option price even without any movement in the underlying, I don’t think a cup and saucer pattern explains this movement. Technicals do move option prices at trend lines and crucial support and resistances, but not based on patterns like cup and saucer or flag patterns - and definitely not before the actual break/confirmation candle. Could you explain why we had 400+ upmove on expiry, when retail clearly shorted calls, when there’s no definite news? Are you suggesting that pattern is the reason for 400+ upmove?
To me, this is definite manipulation. Almost half of the users here don’t disagree that it is - they’re saying “This is just the way it is - in India. Big players screw the little ones”. They just don’t want to term it “manipulation” or “scam” for wherever reason.
This is not a unknown phenomenon either. I’m not the only one making the claim. Hedge funds do as well:
So, what is the alleged oddity?
Derivative prices are supposed to move in tandem with the underlying asset or with an expected move in the underlying asset, in this case the index. In the Indian market, things are different, said the fund managers.
What they are seeing is a sharp price movement in derivatives and then a subsequent price movement in the underlying asset to justify the former.Those are what they have come to call “violent expiry days”.
“On such days, implied volatility (IV) of options goes from 12 percent to 36 percent for no reason… it’s beyond 3 sigma, beyond bizarre,” said a fund manager, who spoke on condition of anonymity.
Some more news:
Sebi ‘watchful’ of manipulative practices, trades in index heavyweights
It’s not just penny stocks. Our index is playground for them.
“It is like betting on a horse race that’s 500 metres before the finish line and another race that’s 5 metres before the finish line by factoring in the same level of uncertainty,’ said one of the sources cited.
Fund managers who cumulatively hold three decades’ experience trading options and with an impressive return profile—one even delivering 40 percent returns with 5 percent drawdown for nearly a decade - told Moneycontrol that they and many of their peers see this as an indication that there is a fund or collective of funds that could be manipulating the Indian derivatives market
These fund managers are not losers and they’re not looking to blame. They made impressive returns in other markets. But they’re saying some are manipulating the Indian market.
The thing is not that they do it, but they do it so brazenly 400+ on expiry days with no fear of retribution, suggesting SEBI might be hand in glove. (And even before that not letting nifty go below 23300 - i.e., they knew they are going to up this market on expiry)
My two cents
I personally believe there is some amount of manipulation on expiry day’s
To be frank it is every where in life , just tell me where it isn’t
There is always information imbalances , opportunity imbalances etc
The imbalance is what moves the market
That doesn’t mean we cant earn . In fact I did lose yesterday . Retrospectively some of which can be avoided
I still believe we can earn
That being said I might be wrong
@nithin What are your views ?
You have seen these argument all your life ig 
No it doesn’t. But the odds are stacked against us in a rigged game. As the fund manager says,
If you do manage to make the same bet as them, you won huge. If you were to bet against them, you lost huge. The thing is they know, while you playthe guessing game.
To be clear, the point of the original post is not whether there is manipulation. It’s how to spot it and make money. But some here seem to live in a delusion, so had to link some sources to make the stand that there is indeed clear manipulation and that it is well known even among hedge funds. If these guys want NIFTY to open at 22000 next trading day and close at 24000 the same day - with no real news, I’m sure they can do it and get away with it too. It’s important we know who we’re playing against.
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Okay. Whatever you are saying is right. It’s a scam. 
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