Regarding Expected Move Calculation
Expected move is the amount that a stock is predicted to increase or decrease from its current price, based on the current level of implied volatility for binary events. We use this calculation on the day before the binary event or very close to the expiration date. The expected move of an stock for a binary event can be found by calculating 85% of the value of the front month at the money (ATM) straddle. Add the price of the front month ATM call and the price of the front month ATM put, then multiply this value by 85%. Another easy way to calculate the expected move for a binary event is to take the ATM straddle, plus the 1st OTM strangle and then divide the sum by 2.
You can learn more about expected move here
Thanks, Is it possible if OA will give some kind of Guidance about + ve or -ve move base on internal Option movement dynamically?( Like in today for HDIL is was showing 8 % move ..so in this case very difficult to trade if we are not sure about the direction…)
You cannot use Expected Move to predict market direction. But Expected move can be used only to predict the Expected Range on any event like earnings results or any planned corporate announcement aka binary events. It is just a high probability range apart from that Expected range cant be used for speculative strategies but to build option strategies to benefit out of that insane range mostly directionless market neutral strategies .