CPR is just the three lines which is like a magnet and price approaches these levels. CPR acts like a support or resistance.
2/24
#CPR is an indicator which is used for #Intraday in Stock Market.
This learning thread would be on
"๐๐จ๐๐จ ๐ค๐ ๐พ๐๐"
Likeโค๏ธ& Retweet๐for wider reach and for more such learning thread in the future.
Also, an investment strategy is shared using CPR in the end.
1/24
CPR is just the three lines which is like a magnet and price approaches these levels. CPR acts like a support or resistance.
2/24
๐ฃ๐ถ๐๐ผ๐ = (High + Low + Close)/3
๐๐ = (High + Low)/2
๐ง๐ = (Pivot โ BC) + Pivot
For intraday chart use previous day candle HLC. Similarly, for Daily Chart it would be Monthly HLC. For Weekly/Monthly Chart use Yearly HLC.
3/24
Images are shared for CPR setup of both the terminals (Zerodha and Tradingview).
4/24
If CPR is moving up for the next day, then trend is up. If CPR is moving down for the next day, then trend is down.
Some examples for both:
In the below chart of Nifty (5 mins), CPR is moving down and price is also in downtrend.
5/24
CPR was moving up on subsequent days. Price was also in uptrend during that time.
One can use higher time frame charts as well to find out long term or short-term trend.
6/24
CPR is moving up every year and price is also in an uptrend for last 14 years.
Price moved up from 80 to 3200 (4000% returns).
Similar CPR can be used on any other time frame.
7/24
If CPR is narrow, then it is expected that there would be a good one sided trend. If CPR is broad, then it is expected that there would be a consolidation or sideway move.
8/24
Wide CPR was formed and price was in consolidation for intraday. This was a good day to eat premium in options because of theta decay.
When narrow CPR was formed then one sided move was seen.
9/24
10/24
1. Use 5 mins time frame.
2. Add CPR indicator.
3. If price is above CPR then wait for the retest. If price retest CPR and forms bullish candle (hammer, engulfing) then go long.
4. Stoploss will be candle's low or just below the lowest CPR.
11/24
6. Try to target atleast 1:2 Risk Reward or even more than that.
12/24
Nifty [5mins].
Price retest CPR region and gave confirmation with a bullish candle.
Then price moved up from 17740 to 17950. Almost 200 points move.
Price had retested CPR multiple times. Just keep stoploss below the lowest CPR.
13/24
1. Use 5 mins time frame.
2. Add CPR indicator.
3. If price is below CPR then wait for the retest. If price retest CPR and forms bearish candle (shooting star, engulfing) then go short.
4. SL will be candle high or just above the highest CPR.
14/24
6. Try to target atleast 1:2 Risk Reward or even more than that.
15/24
Nifty [5mins].
Price retest CPR region and gave confirmation with a bearish candle.
Then price moved up from 18112 to 17960. Almost 150 points down move.
Price had retested CPR. Just keep stoploss below the lowest CPR.
16/24
I personally use CPR only on #Nifty and #BankNifty for intraday.
17/24
Rules will remain same as that of intraday that we have discussed.
Time frame would be Daily or Weekly. So use Monthly CPR in case of Daily chart and Yearly CPR for Weekly chart.
18/24
Let's see an example for Swing Buy Setup.
Reliance Daily Chart.
When price retested CPR after that it rallied by 10%.
19/24
Rules will remain same here and no change.
Best part of CPR is one can use any time frame and appropriate CPR calculation time frame to find out decent trades from intraday to investment.
20/24
1. Use Weekly/Monthly time frame chart.
2. Use CPR based on last Year HLC value.
3. Other all rules will remain same as discussed in intraday setup.
4. Stoploss rule and Risk: Reward rule also remain same.
21/24
JK Cement (monthly chart).
Price retested CPR and then gave confirmation with hammer candle.
Price moved from 146 to 360. Profit of 146%.
Check all the chart of stocks during Covid Crash for an interesting observation.
22/24
More from Yash Mehta
So many free content available on Option trading, still very few are able to trade in options successfully.
Here is a master thread that will help a beginner to learn about Options Trading.
A complete course worth Rs 50K for free ๐งต:
1/ Zerodha Varsity: Options Theory for Professional Trading
This book will give you a basic understanding of options works and what all thing impacts
2/ Zerodha Varsity: Option Strategies
This book has covered basic option strategies that a trader can use.
Still if you can't read this books then in the next part, summary of most of these things is
3/ Options Greeks:
A detailed thread on basics of Option Greeks and how it impacts Options
4/ Basic Option Trading Strategies:
There are many option strategies to trade. But keeping your strategy simple is the key.
In this thread, all the basic option trading strategies are being
Here is a master thread that will help a beginner to learn about Options Trading.
A complete course worth Rs 50K for free ๐งต:
1/ Zerodha Varsity: Options Theory for Professional Trading
This book will give you a basic understanding of options works and what all thing impacts
2/ Zerodha Varsity: Option Strategies
This book has covered basic option strategies that a trader can use.
Still if you can't read this books then in the next part, summary of most of these things is
3/ Options Greeks:
A detailed thread on basics of Option Greeks and how it impacts Options
There are various Options Greeks like: Delta, Gamma, Vega, Rho, Theta.
— Yash Mehta (@YMehta_) September 4, 2022
A complete guide on how these #Option Greeks impact option price.
4/ Basic Option Trading Strategies:
There are many option strategies to trade. But keeping your strategy simple is the key.
In this thread, all the basic option trading strategies are being
Option trading is tough as there are many strategies based on different market view.
— Yash Mehta (@YMehta_) September 30, 2022
Sharing 6 basic Option Strategies for free that you can use based on different market view (sold as a \u20b9 25,000 course!).
A thread \U0001f9f5:
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A THREAD ON @SarangSood
Decoded his way of analysis/logics for everyone to easily understand.
Have covered:
1. Analysis of volatility, how to foresee/signs.
2. Workbook
3. When to sell options
4. Diff category of days
5. How movement of option prices tell us what will happen
1. Keeps following volatility super closely.
Makes 7-8 different strategies to give him a sense of what's going on.
Whichever gives highest profit he trades in.
2. Theta falls when market moves.
Falls where market is headed towards not on our original position.
3. If you're an options seller then sell only when volatility is dropping, there is a high probability of you making the right trade and getting profit as a result
He believes in a market operator, if market mover sells volatility Sarang Sir joins him.
4. Theta decay vs Fall in vega
Sell when Vega is falling rather than for theta decay. You won't be trapped and higher probability of making profit.
Decoded his way of analysis/logics for everyone to easily understand.
Have covered:
1. Analysis of volatility, how to foresee/signs.
2. Workbook
3. When to sell options
4. Diff category of days
5. How movement of option prices tell us what will happen
1. Keeps following volatility super closely.
Makes 7-8 different strategies to give him a sense of what's going on.
Whichever gives highest profit he trades in.
I am quite different from your style. I follow the market's volatility very closely. I have mock positions in 7-8 different strategies which allows me to stay connected. Whichever gives best profit is usually the one i trade in.
— Sarang Sood (@SarangSood) August 13, 2019
2. Theta falls when market moves.
Falls where market is headed towards not on our original position.
Anilji most of the time these days Theta only falls when market moves. So the Theta actually falls where market has moved to, not where our position was in the first place. By shifting we can come close to capturing the Theta fall but not always.
— Sarang Sood (@SarangSood) June 24, 2019
3. If you're an options seller then sell only when volatility is dropping, there is a high probability of you making the right trade and getting profit as a result
He believes in a market operator, if market mover sells volatility Sarang Sir joins him.
This week has been great so far. The main aim is to be in the right side of the volatility, rest the market will reward.
— Sarang Sood (@SarangSood) July 3, 2019
4. Theta decay vs Fall in vega
Sell when Vega is falling rather than for theta decay. You won't be trapped and higher probability of making profit.
There is a difference between theta decay & fall in vega. Decay is certain but there is no guaranteed profit as delta moves can increase cost. Fall in vega on the other hand is backed by a powerful force that sells options and gives handsome returns. Our job is to identify them.
— Sarang Sood (@SarangSood) February 12, 2020
