Dear mvkarthik,
I went through the thread carefully and have some very basic fundamental questions.
Q1) Just as MAX OI is important, shouldn't we also look at MIN OI? This would represent the strike prices that Bulls/Bears are no longer willing to protect.
Q2) CHOI also contains negative number. shouldn't the comparison be made on absolute values? Positive MAX CHOI would imply significant increase in interest at a given level whereas negative MAX CHOI would imply significant decrease in the interest at a given level?
Also, I would like to re-summarize the important rules here. Please take time to review them and confirm that I've not misunderstood any rule.
1) If the MAX CHOI of PE is higher than the MAX CHOI of CE, it is a LONG signal (BUY) on the underlying stock/index.
2) If the MAX CHOI of CE is higher than the MAX CHOI of PE, it is a SHORT signal (SHORT) on the underlying stock/index.
ALSO
3) When MAX CHOI of PE reaches and exceeds 10 lakh and is also higher than the MAX CHOI of CE, it is further confirmation of a LONG signal
4) When MAX CHOI of CE reaches and exceeds 10 lakh and is also higher than the MAX CHOI of PE, it is further confirmation of a SHORT Signal
5) When both, MAX CHOI of PE and MAX CHOI of CE, reach and exceed the value of 10 lakh, the market is likely to be remain range bound, so Buy a Call near the lower levels of the range and Buy a Put near the upper levels of the range.