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My Notes UPDATED
My Notes UPDATED
2
starting with the smaller strike
3
price on the Call Side and moving
4
towards out of the money, the
5
highest Open Interest or Volume, 6
whichever is closest to the 7
imaginary line, is known as the 8
Resistance.
SUPPORT
SUPPORT
CALL SIDE PUT SIDE
Starting from the pair of strike
OI VOL 1 VOL OI
prices on the Imaginary Line,
2
starting with the smaller strike
3
price on the Put Side and moving
4
towards out of the money, the
5
6
highest Open Interest or Volume,
7
whichever is closest to the
8
imaginary line, is known as the
Support.
There are three types of resistance and support: strong, weak toward the top,
and weak toward the bottom.
1. WHAT IF SUPPORT OR RESISTANCE ARE SOLELY BASED ON
VOLUME OR OPEN INTEREST?
CASE 1:
CASE 2 (RARE):
CASE 1: ILLUSTRATIONS
CALL SIDE PUT SIDE
OI VOL 1 VOL OI
RESISTANCE & SUPPORT - STRONG
2
RESISTANCE IS STRONG AT #7 DUE TO THE
3 STRONG
HIGHEST OI
4 STRONG
STRONG 7
OI VOL 1 VOL OI
RESISTANCE & SUPPORT - WTT
2
RESISTANCE IS AT #5 DUE TO THE HIGHEST OI
3 STRONG
WHICH IS WEAK TOWARDS TOP AT #6
4 WTT
8
CASE 2 (RARE): ILLUSTRATIONS
4
SUPPORT IS STRONG AT #5 DUE TO THE
5 STRONG
HIGHEST OI
STRONG 6 VOLUME IS AT #3 AND IS WEAK TOWARDS
BOTTOM AT #5 WHICH HAS NO IMPACT ON
7
SUPPORT
STRONG 8
2 STRONG
RESISTANCE IS AT #5 DUE TO THE HIGHEST
VOLUME WHICH IS WEAK TOWARDS 3 WTT
BOTTOM AT #4
4
STRONG 7
2
RESISTANCE IS AT #5 DUE TO THE HIGHEST
VOLUME WHICH IS WEAK TOWARDS TOP AT
3 STRONG #7
4 WTB
SUPPORT IS AT #4 DUE TO THE HIGHEST
WTT 5
VOLUME WHICH IS WEAK TOWARDS
6 BOTTOM AT #3
STRONG 7
8
2. WHAT IF SUPPORT OR RESISTANCE ARE BASED ON VOLUME &
OPEN INTEREST BOTH?
CASE 1:
CASE 2 (RARE):
CASE 1: ILLUSTRATIONS
OI VOL 1 VOL OI
RESISTANCE & SUPPORT - STRONG
2
RESISTANCE IS STRONG AT #5 DUE TO THE
3
HIGHEST OI & VOLUME BOTH
4 STRONG STRONG
OI VOL 1 VOL OI
RESISTANCE - WTB & SUPPORT - WTT
2
RESISTANCE IS AT #6 DUE TO THE HIGHEST
OI & VOLUME BOTH WHICH IS WEAK 3
TOWARDS BOTTOM AT #5
4 WTT WTT
5
SUPPORT IS AT #4 DUE TO THE HIGHEST OI &
VOLUME BOTH WHICH IS WEAK TOWARDS WTB WTB 6
TOP AT #5
7
STRONG STRONG 5
SUPPORT IS STRONG AT #4 DUE TO THE
6 HIGHEST OI & VOLUME BOTH
WHERE OI IS WEAK TOWARDS BOTTOM AT
7 #3 WHICH HAS NO IMPACT ON SUPPORT
8
CASE 2 (RARE): ILLUSTRATIONS
OI VOL 1 VOL OI
RESISTANCE - WTB & SUPPORT - STRONG
2
RESISTANCE IS AT #6 DUE TO THE HIGHEST
3 OI & VOLUME BOTH WHICH IS WEAK
TOWARDS BOTTOM AT #4
4 STRONG STRONG
5
SUPPORT IS AT #4 DUE TO THE HIGHEST OI &
STRONG WTB 6 VOLUME BOTH WHICH IS STRONG
7
OI VOL 1 VOL OI
3 WTT STRONG
RESISTANCE IS AT #6 DUE TO THE HIGHEST
OI & VOLUME BOTH WHICH IS STRONG 4
8
3. WHAT IF SUPPORT OR RESISTANCE IS A COMBINATION OF
EITHER VOLUME OR OPEN INTEREST?
CASE 1:
CASE 1: ILLUSTRATIONS
OI VOL 1 VOL OI
WTT 5
SUPPORT IS AT #4 DUE TO THE HIGHEST
STRONG 6
VOLUME WHICH IS WEAK TOWARDS BOTTOM
7
AT #3
OI VOL 1 VOL OI
RESISTANCE - WTB & SUPPORT - WTT
2
RESISTANCE IS AT #5 DUE TO THE HIGHEST OI
3 STRONG
WHICH IS WEAK TOWARDS BOTTOM AT #4
4 WTT
8
CASE 2 (RARE): ILLUSTRATIONS
OI VOL 1 VOL OI
RESISTANCE - WTB & SUPPORT - STRONG
2 STRONG
RESISTANCE IS AT #4 DUE TO THE HIGHEST
3 STRONG OI WHERE VOLUME IS AT #7 WHICH IS WEAK
STRONG 4
TOWARDS BOTTOM AT #3
WTB 7
OI VOL 1 VOL OI
RESISTANCE - STRONG & SUPPORT - WTT
2 WTT
RESISTANCE IS AT #5 DUE TO THE HIGHEST
3
VOLUME WHERE OI IS AT #7 WHICH IS WEAK
TOWARDS BOTTOM AT #6 WHICH HAS NO 4
EFFECT ON RESISTANCE STILL STRONG
STRONG 5 STRONG
SUPPORT IS AT #5 DUE TO THE HIGHEST OI
6
WHERE VOLUME IS AT #2 WHICH IS WEAK
WTB 7
8
4. WHAT IF SUPPORT IS OF BOTH OPEN INTEREST AND VOLUME?
CASE 1:
If either Open Interest or Volume attempts to move towards In The
Money,
this Support will be referred to as Weak Towards Top.
CASE 2:
When both Open Interest and Volume move Out of The Money,
this is referred to as Weak Towards Bottom.
However, if only one tries to move, it is not considered WTB.
CASE 1: ILLUSTRATIONS
OI VOL 1 VOL OI
3 WTT WTT
SUPPORT - WTT
OI VOL 1 VOL OI
2
SUPPORT - WTB
3
OI VOL 1 VOL OI
SUPPORT - STRONG
2
3
SUPPORT IS AT #4 DUE TO THE HIGHEST OI &
VOLUME BOTH WHERE ONLY OI IS WEAK 4 STRONG STRONG
TOWARDS BOTTOM AT #3 WHICH WILL NOT
AFFECT SUCH SUPPORT OF BOTH 5
8
CASE 3 (RARE): ILLUSTRATIONS
OI VOL 1 VOL OI
4 WTT WTB
SUPPORT - WTT
CASE 1:
If Open Interest and Volume attempts to move towards In The
Money,
this Resistance will be referred to as Weak Towards Bottom.
CASE 2:
When both Open Interest and Volume move Out of The Money,
this is referred to as Weak Towards Top.
However, if only one tries to move, it is not considered WTT.
CASE 1: ILLUSTRATIONS
OI VOL 1 VOL OI
WTB WTB 5
RESISTANCE - WTB
OI VOL 1 VOL OI
RESISTANCE - WTT
2
3
RESISTANCE IS AT #5 DUE TO THE HIGHEST OI
4 & VOLUME BOTH WHERE BOTH ARE WEAK
TOWARDS TOP AT #7
WTT WTT 5
2
RESISTANCE IS AT #6 DUE TO THE HIGHEST OI
& VOLUME BOTH WHERE ONLY VOLUME IS 3
WEAK TOWARDS TOP AT #3 WHICH WILL NOT
4
AFFECT SUCH RESISTANCE OF BOTH
5
STRONG STRONG 6
8
CASE 3 (RARE): ILLUSTRATIONS
OI VOL 1 VOL OI
WTT WTB 5
RESISTANCE - WTB
AND GENERATING NEW VOLUME AT ANY OTHER STRIKE PRICE TAKES TIME
3. SUPPORT / RESISTANCE OF BOTH VOLUME & OPEN INTEREST
THE OTHER WILL TAKE TIME TO SHIFTED, ESPECIALLY IN THE CASE OF GOING
OUT OF THE MONEY, EITHER ON THE CALL SIDE OR ON THE PUT SIDE.