By the way, Nitin ji, you have taught many things to people.
You have seen different videos with Nitin ji on this channel.
How does PCR ratio work? When should we trade?
Apart from PCR, there are many things in the auto-render software.
We tried to understand different things.
There are still many things for people to understand in this software.
Because it has a delivery scanner, calls are automatically generated, signals are generated in auto-render near support resistance, below support resistance and in commodity.
All these features are still left for people to understand.
But now there is one more important thing which is left for me.
You said that when you become an option buyer from an option seller, what is your strategy in buying? You can take entry just by looking at PCR.
When to take entry and when to exit, what will be your target? All these things are still left for people to understand. So whatever I am asking, I am asking on behalf of the audience.
So, now you decode your strategy in this video.
Tell people how they have to follow your strategy.
In the PCR based strategy that I follow, I use two very simple methods.
Simple rule number one is what is the data of PCR?
And generally, we see what is the data of PCR after 11 AM or so.
So, rule number one is that you have to see the data of PCR after 11 AM.
If it is positive, then its value is more than 1. For example, I am showing you the data of Bank Nifty.
And the value of PCR, as I said, the time should be after 11 AM.
And after 11 AM, you see that the value of PCR is 2.6.
That is, it is more than 1. So, I have to buy it.
So, it is simple I got the trend.
Now, when do we have to take the entry?
This is rule number two, which is the most important.
And the entry, generally, we enter around the volume weighted average.
What is the volume weighted average price?
The market opens at 9 am, 9.15.
And till 11 am, what is the average price of whatever volume happened in the market? So, in Autotrender, you can see its average price here.
The average price at that time is about 45,333.
And this is your VWAP.
There are two prices.
You see above, this is the VWAP.
The volume weighted average price.
And this is the price.
And the price has gone below the volume weighted average price.
If it is below also, it is no problem.
I am getting cheaper below.
That is what I am saying.
If it is below, it is good.
Good, I am getting cheaper.
So, if I see it at 11 am, that PCR is above 1.35.
Meaning it is above 1.35.
So, I will take the call option.
And when will I take the call option, this is very important.
This is Vwap.
If I get the market around or below VWAP, I will take the call option here.
Now, you see, I got this at 11.15.
Around 45,300, there is Bank Nifty.
So, if I take the call option here, where did the market close?
This is 45,900.
Means there is a rally of 600 points.
Means if you buy the call option, you have a three times call option.
So, like this, basically you have to watch the PCR till 11 am.
And you have to sit looking for the opportunity when Nifty or Bank Nifty comes around VWAP.
And this VWAP can be plotted on the futures chart.
Many people complain here that they put VWAP on the chart.
So, VWAP will not be on the spot chart.
You will go to indicators, you will find VWAP, you can plot VWAP.
And you can see the value of VWAP here.
And VWAP is basically a volume-weighted average price.
And it is not on spot because spot does not trade.
Nifty trades in future.
And in trading there will be volume-weighted average.
So it is on spot.
And the VWAP levels and the price levels, what are these futures levels?
These are futures levels.
Both of these are futures levels.
It is important to explain this to people.
So, if the price has not come to spot.
So, here the levels are written looking at the futures price.
If you are looking at the spot price, you will understand that the price will rise.
And what is the advantage of taking VWAP? That you are taking it at such a level of the market where your stop loss is also small.
And the risk to reward ratio will be better.
Will you show a bar chart?
Yes, I will show you through the chart.
So, Mr. Pushkar, you are seeing this graph.
This is the blue line, this is VWAP.
And this is the tick-by-tick chart of Nifty futures.
If you are seeing candlestick, you can also put it on the candlestick.
You can also use line chart in your chart.
It is easy.
Some people follow line chart, some people follow candlestick chart.
So, here the PCR was negative and it came around VWAP.
And we got a very good sell from there.
So, this was opportunity 1. And then we got the market to bounce back again.
And then it came around VWAP.
And then it started to reverse and we got the next sell.