INDIA VIX v/s Nifty Volatility Dashboard

The INDIA VIX v/s Nifty Volatility Dashboard indicator provides a comprehensive forecasting tool designed to estimate NIFTY's price range across multiple timeframes based on current India VIX volatility data.

Usage

The dashboard is primarily used by options sellers to determine potential support and resistance ranges for NIFTY over hourly, daily, weekly, monthly, quarterly, and annual periods. By visualizing these volatility-implied levels, traders can make informed decisions regarding strike price selection and risk management.

Key features include:

• Dynamic vs. Static Calculation: Choose between "Static" mode (based on previous day's closing prices) or "Dynamic" mode (using real-time Last Traded Prices) to calculate volatility ranges.
• Visual Dashboard: An on-chart table displays current NIFTY and INDIA VIX prices, percentage changes, and the calculated Min/Max ranges for all timeframes.
• On-Chart Levels: Option to plot the calculated volatility boundaries directly on the price chart and price scale for immediate visual reference.

Details

The indicator calculates volatility levels by taking the current (or previous) INDIA VIX value as the annualized volatility. It then applies the "square root of time" rule to derive volatility for shorter durations:

• Quarterly: Annual Volatility / sqrt(4)
• Monthly: Annual Volatility / sqrt(12)
• Weekly: Annual Volatility / sqrt(52)
• Daily: Annual Volatility / sqrt(252)
• Hourly: Annual Volatility / sqrt(trading hours per year)

These percentages are then applied to the Reference Closing Price (RCP) of NIFTY to project upper and lower bounds.

Settings

Table Display Settings

• Show Table?: Toggles the visibility of the dashboard table.
• Position: Adjusts where the table appears on the chart (e.g., top right, bottom left).
• Text Size: Controls the size of the text within the table.
• Always show all levels: Forces the table to display every timeframe regardless of specific level visibility settings.

Show Levels

• Static or Dynamic?: Sets whether calculations use previous close data (Static) or real-time LTP (Dynamic).
• On Chart / On Price Scale: Toggles the visual plotting of levels.

Levels to show?

• RCP: Displays the Reference Closing Price used for volatility calculations.
• Timeframe Toggles: Individual checkboxes for Hourly, Daily, Weekly, Monthly, Quarterly, and Yearly levels.
• Level Appearance: Options to customize color, thickness, line style, and line extension (Left, Right, or Both).

Symbols

• Volatility Index: The ticker used for volatility data (default NSE:INDIAVIX).
• Benchmark Index: The ticker used for price levels (default NSE:NIFTY).

FAQ

How do I use these levels for option selling?

Traders typically use the Min and Max ranges as "safe zones" to select OTM (Out-of-the-Money) strike prices that are statistically less likely to be breached within the chosen timeframe based on current volatility.

Why is there a warning on my chart?

The indicator is designed specifically for the NIFTY index. If you apply it to a different chart, a warning will appear suggesting you switch to the NIFTY ticker defined in the settings.

How can I access INDIA VIX v/s Nifty Volatility Dashboard?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.