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Integrated Tool User Manual

A. Activation Procedure: Refer the Installation procedure to do the installation. After the

installation, the desktop icon of integrated tool would be flagging on your desktop as

given in the picture below.

To run the application you need to double click on the desktop icon. This will generate

the activation window and the machine id. The machine id is unique to every system.

This id remains unchanged even if you format the system. Upon getting your machine id

via e-mail, the corresponding activation key is generated by us and sent to you. Do

remember you need this activation key each time you run this application. Hence save

a copy of this activation code in a safe place other than the computer. The activation

window will look similar to the below screen.

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After getting, the activation code put it in the activation code empty box and clicks on

the “save activation code” button.

On clicking the “save activation code” a new window will open up which will say in

which location of your hard disk the activation code is saves and the file name of the

same. Now click ok to close the window and click activate to activate the software. We

advise you to keep the activation code in writing in some other safe place other than

computer.

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B. Upon valid activation, the software main window will open. This looks similar to the

window given below.

This tool has different decision making calculators developed based on gann,fibonacci,elliot

wave and other principles. This tool will help you in making the follwing decisions.

i. Intraday trade decision

ii. Short term investment decision

iii. Option intraday decision

iv. Option greek analysis

v. Option implied volatility analysis

vi. Option positinal trade decission making.

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For All intraday calculators I will use the 1st 15 minute High, Low and current price as input. Why

15 minute standard ? you may take 5 minute standard also.However initial 15 minute will give

you some clue about the trend of the market will be. We too have a trend calculation in this

tool.Using that calculator before the market opens you can calculate the volatility, price point

above which trend will be up and below which trend will be down. However for successful trade

practice use the initial 15 minute stndard.

What will be done if I arrive on the trading desk after 10 A.M? In this case whatever the

recorded high, low and current trade price you need to punch in the calculator.

Gann Intraday Calculator:

Inputs required : High,low, current price. you need to choose whether this H-L-C is the 1st one

hour H-L-C or not. I have taken the example of nifty future 20th june 2011 price points.

The opening candle- 9:15 candle made high 5379.4, 9:30 candle made the low 5335 and the 9:30

current price was 5344.95 round it to 5345. I am also in the 1st hour of the trading day.

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Upon giving the above mentioned inputs we have got the following outputs where in buying is

advisable at 5357.20 for final target 5480 .Selling advisable at 5332.85 for final target 5212

current price has not given any triggering action .

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Below chart explains that we got the sell side opportunity at 9:40 period and achived all the

targets by 10:10

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If the same inputs are given and you made a choice that you are not in the 1st hour of the

trading day then you will get the out put as follows. Where in all your entry points ,targets will

change .you can save this result into a text file for your future referense just by clicking the save

button.

The above screen says my price analysis experiment is saved in c:\ under the file name gann-

intra19-1-40-296.text

The other Gann tools are

i. Square of nine static wheel for investors: This tool will be helpful for deriving the

investment decision for weekly or 15 days period. However it has condition attached to

it . you must use a high and low which has at least 5 to 10 % price difference between

them.

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Example: I have taken the JP associate stock for analysis for a weekly investment decision.The

past week data are as follows. From this I can canclude high 85.10, low 80.65 closing as on 17th

june 81.30. we need minimum 5% difference between the high and low.Hence 5% of

5.10=Rs4.25. Rs85.10-4.25=80.85 However low is 80.65 This is below 80.85 .Hence this high and

low qualifies for the inputs .

This says buying is advisable at 82.05 with stop loss 80.75 for final target 85.10 . The static wheel

will be limited to the maximum 85.10 and minimum of 80.65. If you want more expanded result

then you can use the dynamic wheel. Using the same input in the dynamic square of nine wheel

we got the advise to buy at 84.20 with stop loss 82.90 for target 87.20.

Date High Low Last trade price

13-Jun-11 84.65 80.65 84.45

14-Jun-11 85.1 83.7 84.05

15-Jun-11 84.2 82.2 82.5

16-Jun-11 83 81.35 81.8

17-Jun-11 83.65 81.1 81.3

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If you wish to derive the sell trade decision then you need to use the 1st price as high and 2nd

price as low .

This dynamic wheel suggest us to sell at 81.50 with stop loss 82.80 for target 78.55

ii. Square of 9 dynamic wheel for intraday traders : If you wish to derive the buy sell

decisionfor intraday trade using the square of nine wheel then use the days high-low in

the dynamic square of nine wheel and derive the trade decision. However the last one

hour high-low or 1st 15 minute high and low is recommended for better result. While

using the dynamic square of nine wheel for intraday trade 5 to 10% rule is not

followed.

iii. Squre of 12 static wheel for investors : If the price difference between the high and low

is greater than 10% then use the square of 12 static or dynamic wheel for intraday

trade.

iv. Square of 12 dynamic wheel for intradya traders: If the annual volatility of the script at

any point of time is between 40% to 50% then use the dynamic square of 12 wheel for

intraday trade.

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The square of 12 wheel will look similar to this:

Dynamic Square of 12 wheel :

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C. Fibbonacci trading tool : Fibonacci trading tool is being used in low volatile market for intraday

trade and investment decision . It is also having static and dynamic features. The retracement tool is

very useful for commodity ,currency. For high speculation one can use parallel projection and for

identifying the trend in small price interval one can use the clusture tool. When the annual volatility

or the VIX rules below 20% it is classified as low volatile condition.

When to use the static and when to use the dynamic fibonacci tables ? static retracement or clusture

is being derived considering the high and low given by you as the final high and final low. However the

dynamic retracement and clusture make use of candle gap, random value generation method .

dynamic fibonacci concept is used for making intraday trade decision and the static fibonacci concept

for making the investment decision .

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In Fibonacci retracement tool I have taken the bank nifty high low and last trade price as input on

june 21st 2011 and this has given me the following output . for intraday trade decision I will ignore the

static fibonacci retracement part and follow the dynamic fibonacci retracement part. This suggest me

to buy the bank nifty at 10570.20 with stop loss 10538 for final target of 10664.

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If I will use the same set of input in Fibonacci parallel retracement calculator I will get the

following out put . The output window has two parts in it . parallel retracement -1 and parallel

retracement -2. Technically it is known as 1st degree and 2nd degree retracemnt . In simple

words if you buy at 10562 and achived the final target 10630.50 then at this point trail the stop

loss to 10592.27 and hold the trade for target 10645.15 (i.e. the final target of 2nd degree

retracement)

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If you wish to make a short term investment decision for 3 to 5 days based on the fibonacci

ratio then use the days high,low and close price as input and chose Retracement positional

option in the calculator and input the number of days you wish to hold the trade . In this case

ignore the dynamic fibonacci retracement table and follow the static fibonacci retracement

table. Keep in mind the volatility in annual term must be less than 20% and holding period must

be minimum 3 days and maximum 10 days.

If you are using the parallel retracement calculator for the positional trade then use only the 1st

degree retracement table (i.e. Parallel Retracement 1) for making the trade decision .In this

case also volatility must be less than 20% and the maximum number of days will be 10 and

minimum number of days will be 3.

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D. Intraday option trading tool: In this, we need to do a two-phase analysis

Phase 1: we will analyse the trend to know whether to trade in call option or put option. I wish to trade

in Sbi options on 21 June 2011. However, I do not know which strike to choose and whether to trade in

call option or put option. In the option intraday calculator I have given the previous day high, low, last

trade price, current day high, low, current price , open price as recorded by 10:55 a.m. after this I have

clicked on the ANALYSE PRICE button . This suggested me to buy the underlying at 2209.90 with stop

loss at 2158.698. Hence I concluded that above 2209.90 trend is up and below 2158.698 trend is down.

Current price is above 2212 .Hence I will choose either to buy 2200 ce or to sell 2200 pe

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Upon giving the strike, option premium, days till expiry as 9 days and choosing the call option I have got

the following output.

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Phase 2: This suggests me to buy the call at 45 stop loss 21.20 for target 53.26-61.47 and final target at

125.52. All targets of the underlying asset as given above are as per the volatility. Along with the various

premium targets, it also gives the information on the option Greeks that is currently associated with the

option premium of 46 rupees. Advanced option traders always wish to know the behavior of the Greeks

at different premium points so that they can plan the hedging in an effective manner. In this tool we

have incorporated this feature just by clicking on the GREEK BEHAVIOUR AT DIFFERENT OPTION

PREMIUM you know the behavior of the greeks at different premium price points along with the implied

volatility.

As given above the current delta of the option, which is 0.5831 at this moment, will increase till 0.8859 if

the call option manage to achieve the final target similarly if the stop loss triggers then this delta will

change to 0.3561. If you wish to derive a risk neutral hedging plan then you need to add a put option at

this point of time that is having a delta close near to -.5831. I have chosen 2200 pe which was having

the premium of 38 based on the same inputs I have the following.

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Current delta of the put option is-0.4302 if I will buy one call and one put at this point of time my net

delta will be 0.5831-0.4302= 0.1529

If the upside optimum target 2315 achieved then the net delta will be 0.8859-0.1617=0.7242 and the

projected profit will be 125 -46-38+11.50= 52 points.

If the down side optimum target 2054 achieved then the net delta will be 0.1009 -0.8747=0.7738 and

the projected profit will be 147 -38-46+6.25= 69.25 points.

Similar way you can form IV (implied volatility)neutral, gamma neutral, Vega neutral, theta neutral

strategies for intraday or positional gain.

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Option positional calculator is highly useful for the option strategy trader. This tool is only for the

advanced option traders those who understand the option Greeks and option base strategy effectively.

For example, I want to take nifty straddle in 5300 strike on 21st June 2011 for 4 days. Hence, I want to

know the followings:

a. What is the expected price the underlying asset can move during my holding period? b. How the premium and option Greeks will behave during my holding period?

After giving the necessary inputs like option strike, option price, current price of underlying asset,

interest rate as 10 %, and number of days wish to hold and number of days left till expiry. I got the

following outputs.

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The above data says during the process of my holding the underlying asset price will find the initial

resistance at 5361.23 and support at 5244.77. If it manages to cross the 1st level of resistance it can

touch 5397.20-5422.81 and 5455.44. Similarly if it falls below 5244.76 it will touch the levels 5208.79-

5183.18-5150.55

At these levels the call option premium its implied volatility and other option Greek information is given

for your reference.

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Similarly, 5300 pe gives a different set of resistance and support and on those levels premium and Greek

information. As a saddle buyer of 5300 strike calls and put at 69 and 68.80. After 4 days if the upside

target achieved, my call option will be trading at 87.75 and put option will be trading more than 25.65.

if you want the know the exact price of the put option then you need to take the help of omega.

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Omega- This says, for each 1% change in the underlying asset how much change the option premium

will change. At 5376 level omega of the put option -59.07 % . From 5376.31 - 5361.23 to in percentage

terms -0.2805 % price difference maintains with the 5376.31 (i.e. (5361.23-5376.31)/5376.31) . Hence

the omega impact on the put option premium will be -59.07*-0.2805=16.56%. The final premium you

can expect is 25.65+25.65*(16.56/100) = 29.89

If I initiate the saddle in 5300 strike at 69 and 68.80 my net investment is 69+68.80 = 137.80. After 4

days, the expected premium at 5361 will be 87.75+29.90=117.65. Hence, at this point of time the above

analysis says long saddle is not advisable rather you can take a short saddle.

Likewise, you can analyse any option strategy, estimate its performances and form risk neutral

combinations.

E. Intraday Volatility calculator: In this tool you need to input the previous day high, low and last trade

price and current day’s 1st 15 minute open, high, low and current price.

Example: I have taken the nifty future 20th June 2011 high-low and last trade price and 21st June 2011 1st

15 minuet open-high-low and current price as an input to make a trade decision.

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The above tool recommends me to buy at 5313.80 with stop loss 5216 for targets 5339-5385… same

time it recommends me to sell at the 5216.20 for targets 5190-5144…. Due to the low spike on 20th June

2011 the targets are quite high in the expanded target zone. Besides this, it is giving me the information

that probability of going up is 49.78% and probability of falling down is 50.21. This probability parameter

says if I will get the chance to buy then getting all the targets are suspicious and trend may reverse

because the probability of falling down is more. Due to huge gap down spike on 20th June 2011 we are

also getting the stop loss point quite deeper at the level of 5216. Therefore, I conclude, this data may

not be useful for me to make an intraday trade.

If such a situation you encounter at any point of time then just changing the input parameter will solve

the issue.

What are the changes you need make? The timing of your trade is very important in this case. Say I am

at 11 a.m. I will take the high-low and current price till 11 a.m. in the place of previous day High-low and

last trade price. I will take last 15 minute (i.e. 10:45 to 11 a.m.) open-high-low and current price in the

place of current day open-high-low and current price. Below intraday chart is given for your reference.

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In our case till 11 a.m. the recorded high is 5308.55, low 5257 current price 5295. 10:45 to 11 a.m. open-

high-low and current prices are 5300.25, 5308.15, 5290.5 and 5295.95 respectively. The above changed

inputs given the following output.

From the above I have concluded that probability of going up is more. Buy recommended price is 5309

with stop loss 5283 for the target 5315.85-5328 …. and sell targets are 5276, 5263.77…etc. If you

observe from the chart around 11:05 we got a chance to buy, achieved till 5322 near to our 2nd target.

We also got a chance to sell at 2:30 p.m. and achieved 5264.70 near to the 2nd target by 2:50 p.m.

How to use this tool for Forex or commodity trade ? While using this tool for forex and commodity use

the Day’s High, Low and last traded price as input in the previous day’s high, low and last trade price.

Use current day’s trailing 15 minuet open, high, low and current trade price in the place of current days

data input. You need minimum 1 hour to take data reference.

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F. Positional volatility trade calculator: If you wish to take a position for maximum 10 days and

minimum 3 days then you can make use of the positional volatility calculator based on the above

discussed inputs. I wish to take a nifty position for 5 days.

The above calculator informs you that buying at 5331 for final target 5416 and selling at 5260.55 for final

target 5175 is expected during this five days period.

G. Trend finding Calculator: In this tool, you need to take past 5 days last traded price or past 5 weeks

closing prices or past 5 months closing prices to identify the trend for daily, weekly, or monthly time.

This tool is very important because it will give you the shortest volatility action in the script.

By using this volatility, you will be in a position to choose correct tool for intraday or positional trade.

Like less than 20% volatility suggests use of Fibonacci or volatility tool will produce better result. Greater

than 20% and less than 40% volatility you may use gann tool or volatility tool. Greater than 40% volatility

you may use the Elliot trading tools or volatility tool.

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This tool will guide you to choose a correct option strategy for your trading portfolio. Less than 20%

volatile condition and price above the uptrend price point you may choose range bound strategy like the

one ‘net debit calendar spread’ in just out of money call option or in just out of money put options. You

may choose short call butterfly. Hence based on the volatility and trend confirmation price point will

guide you to choose a correct option strategy for your trade portfolio. You can learn more about the

option strategy on Mr. Ranjan’s book on ‘Master key to future and option’ and classification of strategy

from the DVD Master course.

Example: I wish to find the nifty future price trend for 22 June 2011. I need the past 5 days last trade

price data for the same. The below given are the data I need

The above calculator says the short term annual volatility is 15.21% uptrend price point is 5292.46 down

trend price point is 5260 and important resistance will be 5302 and support is 5250. On the coming day,

the price may move in a narrow range of 40 point.

Date LTP

15-Jun-11 5452.65

16-Jun-11 5409

17-Jun-11 5372.7

20-Jun-11 5265

21-Jun-11 5276.1

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H. Intraday Elliot calculator: Based on the open, high, low and current price inputs as 5300.25, 5308.15,

5290.5, 5295.95 the Elliot wave calculator gives the output as given below. This also informs you the

trend and advises you to use the proper wave table.

As you know only after completion of wave 1 or wave-a, we can confirm whether the future wave

structure is going to be impulsive 1-2-3-4-5 or corrective A-B-C. However, this structure may fail during

the process of its formation. These tools will inform you the failure points also. You can make use of this

tool for positional trades too and the minimum days recommended are 3 days and maximum 30 days.

Based on the above inputs the below screen explains how to make use of the same.

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Camarilla and pivot point calculators are the basic calculators, which is also given in our web site with

the proper information to use it. You may refer our website www.smartfinancein.com to get

information for the same.