Explanation of IV, VIX, and ADX

Intraday NIFTY Option Strategy Using IV, VIX, and ADX

This guide helps traders make informed intraday decisions in NIFTY using the combined power of Implied Volatility (IV), India VIX, and ADX (Average Directional Index).

How to Trade Options with IV + VIX + ADX

• IV (Implied Volatility): Tells us how much option prices may move. Higher IV = bigger price swings.
• VIX (Volatility Index): Measures market fear. VIX > 17 suggests momentum; VIX < 13 = sideways market.
• ADX: Measures trend strength. ADX > 20 confirms trend; ADX < 15 means consolidation.

Trading Rules

1. Wait for VIX > 16 and ADX > 20 → Trend likely
2. If PE IV > CE IV → Bias toward PE (puts)
3. If CE IV > PE IV → Bias toward CE (calls)
4. Confirm with price action (breakout candle, moving average crossover, etc.)

 

📉 Intraday Sideways Market Detector

Check	Indicator	What to Look For	Sideways Signal?
✅	Price Action	Small, overlapping candles inside zone	Yes
✅	Support/Resistance	Price bouncing between same levels	Yes
✅	Volume	Falling or flat volume bars	Yes
✅	ADX (15m or 1H)	Below 20 or flat	Yes
✅	Bollinger Bands	Very tight (squeezed)	Yes
✅	EMA 20 / 50	Flat lines, price crossing both sides	Yes
✅	VWAP	Price hugging VWAP with no clear trend	Yes

🕒 Best Timeframes to Check

• 15-Minute: For fast intraday setups (scalping, expiry)
• 1-Hour: For broader trend/range structure

🚫 Avoid Trend Trades If:

• Price stuck inside a zone for > 1 hour
• ADX < 20 and not rising
• No volume on breakout attempts
• Flat EMA 20/50 and VWAP overlap
• IV is falling or IV percentile < 30%

✅ Wait For:

• Breakout candle with volume