Learn the market's language
Short, plain explanations of the terms used across Candle Trade. Education only, never advice.
Open interest (OI)
The number of futures or options contracts still open. Rising OI means new positions are being added; falling OI means positions are being closed.
Put-call ratio (PCR)
Total put open interest divided by total call open interest. It describes positioning in the option chain and is not a forecast.
Max pain
The strike at which option buyers would collectively lose the most if the market expired there. It is a reference level, not a prediction.
VWAP
Volume-weighted average price for the day. Many traders watch whether price is above or below it.
Opening range
The high and low of the first 15 minutes after 9:15 AM. A close outside the range is called a breakout.
RSI
Relative Strength Index, from 0 to 100, comparing recent gains with recent losses. Below 30 is often called oversold, above 70 overbought.
EMA
Exponential moving average. It averages recent prices and gives more weight to the latest ones.
Lot size
The fixed quantity of one futures or options contract. Exchanges revise lot sizes from time to time.
Expiry
The date a derivatives contract ends. Check the latest NSE circular for current expiry days.
Build-up patterns
Price up with OI up is long build-up, price down with OI up is short build-up, price up with OI down is short covering, and price down with OI down is long unwinding.
Gap
When a stock opens well above or below the previous close, leaving a gap on the chart.
STT and charges
Securities Transaction Tax, brokerage, exchange fees, GST, SEBI fees and stamp duty all reduce your profit. Our calculator estimates them.