Let the DATA talk....

Indian Market (Nifty) has killed traders...Just before it is about to turn trader's paradise....

O Ashuji....

Anything that moves can be traded and anything that doesn't move kills. Trading thrives on price movement in underlying asset and liquidity. Greater the price movement in underlying asset, larger is the potential to make big money. Lack of price movement might force trader to take higher leverage and thus greater risk to capture smaller price movement. Anyone talking about period post 2008-2009 crises as volatile period either doesn't trade or has no idea about volatility. This is in context of Nifty. 2010 and 2012 have been historically compressed years for Nifty. 

NIFTY absolute % movement (number of trading days)

1) 2012 had NO trading day with movement greater than 3%. This has never happened in market history. Also observe how bigger move days have been dead post 2009. 

2) Dec 2012 and Jan 2013 had 2...only 2 trading days with movement equal to or greater than 1%.  This is HISTORIC and was kind of CAPITULATION OF COMPRESSION. 

3) Last time Nifty had move greater than 2% was on 21 September 2012 i.e. 123 trading days back. 

Number of Days with >3% Moves in Nifty

Volatility and Compression Clusters....See how bigger move (>3%) days cluster during 1998-2001 followed by subdued 2002-2005 again followed by clustering of volatility in 2007-2009. 2010-2012 WERE DEAD in terms of bigger moves and was historic clustering of compression. It is HIGHLY LIKELY THAT 2013-2016 could be clustering of bigger moves in market. 

NIFTY's Average Daily Absolute % Movement (Reading of 1 for November would  imply average daily 1% move during November)

Conclusion....

We are coming out of highly compressed period in market history (Nifty)...It is highly probable that we are about to witness CLUSTERING OF VOLATILITY in market.