While rummaging through the http://www.dailyspeculations.com/ blog some time back, I landed on this gem.

Just read it. Re-read it, and try adapt it to NIFTY, you would see immense value in it.  I've always intuitively used the concept of "Path Length" in my trading, didn't know its something which the biggies also look at.

Reference - http://www.dailyspeculations.com/wordpress/?p=2507