But that does not present any clear picture in real time. So what to do in Real Time Trading. There are a few things you can do, but with time, practice and experienne.
1. Plot Vix with whatever indicators you use, just as for your stocks.
2. Now the INDEX and VIX with same indicators should behave exactly opposite, other wise one of the move is Fake.
3. USE support and resistance on VIX as you use on any stock or INDEX. That will clear up things for you.
4. I use 30 min VIX Chart, you can use whatever you like.
5. But there are other tricks which you learn from observations and practice.
6. For some more added clarification you can add USDINR. It also has a inverse relationship with NIFTY
As i told you in the beginning, its not that easy and straightforward.
Thanks for response Pradeep , I'm Assuming IndiaVix value is readily available .
Yep USDINR /Nifty relationship is clear ,If FII sell ,nifty Drops , FII convert their money into Dollars , So dollar demand goes up which causes rupee to fall and vice versa :)
Just one important thing you must remember is USDINR relationship is Inter-market. This will not work every time in the same. In fact it can change with time.
Whereas VIX relationship with INDEX is Intra-market. This will remain as it is always. With VIX you can tell 90 % of times as to what direction market is likely to take.
USDINR is just for general confirmation, nothing more.