Part 2 Support and Resistance

Factors That Affect Option Premium
(A) Underlying Price Movement

Bigger moves → bigger premium.

(B) Time Value

Longer time to expiry → higher premium.

(C) Volatility (IV)

Higher IV = expensive options
Lower IV = cheaper options

(D) Demand & Supply

High activity in a strike increases premium.

(E) Market Events

Events like:

RBI Policy

Budget

Elections

Earnings
Cause volatility spikes.