Category Archives: Option Trading Strategy

practical application of option trading strategy on nifty, bank nifty, equity stocks.

Relaunching Option Ideas

Dear Friend,

Every other person visiting our site asks for details on Option Alpha and wish to subscribe for it. So friend, after taking a long sabbatical we are now prepared to restart our flagship product Option Ideas, which has received tremendous response since its inception.

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Bank Nifty & Nifty Technical Analysis for 22 Aug’13

Nifty as on 21 Aug’13– 5302.55 (-98.90)    Bank Nifty as on 21 Aug’13– 9264.40 (+45.45)

Whom to Blame, whom to Curse?

By looking at last sessions price action, only one word comes in our mind is Oh My God. What a reverse, it was a day of classic Bull Trap. There are many fundamental factors which are ruling over the market, but practically, we don’t have anyone to blame or curse, as markets will always be like this, and will remain like this.

When market opened everybody thought, including us, that oh no, we lost the opportunity man, and after looking at humongous rise in Bank Nifty we thought it is better to wait and watch, because at such price high we can’t ask our subscribers to enter, and honestly we also had a feeling that, possibly we might miss the rally, but we stopped ourselves. In the morning only we though, we are done for the day, now there is nothing to take away from this, and market stuck in the range, which was obvious, then market moved to cover the gap, which was also obvious, but what happened next was unusual and which was not expected at all. We know, this market has smashed many bulls and many bears in an intraday session only, unfortunate.

Nifty Trading Strategy

At this point in time we don’t see any safe bet, because you never know, how market can open in the morning. Any trading call will involved high risk, so it is better to play with neutral option strategy like Long Strangle or Long Straddle, problem with this strategy is now time is not in your favor, so it may hurt you.

Bank Nifty Trading Strategy

Similarly, in Bank Nifty we advise not to stay with naked position, better to apply hedge.

Keep visiting Way2Profits, for unbiased view on the market.

Bank Nifty & Nifty Technical Analysis for 20 Aug’13

Nifty as on 19 Aug’13– 5414.75 (-93.10)    Bank Nifty as on 19 Aug’13– 9145.00 (-305.85)

Selling pressure continued even in last session. Looking at intensity of fall it seems that sellers are ready to sell at whatever price they get, targeting much lower levels. Finally, we have close slightly above 5400 levels. Now, for sure weakness sets in, and every rise should be utilized as selling opportunity, but trader’s needs to be tactical here. Probably on immediate front you might not get quick returns but in longer term, it will be fruitful. If you are long term investor then we think still there is some time to enter into the market.

One important point we like to high light here is that, if we see past history of Bank Nifty, then we have not seen such consistent brutal fall.  There are some moves, but we think this one is special.

Nifty Trading Strategy

On hourly time frame there is Positive Divergence building up, but in such prickly fall relying on this phenomenon is quite risky. We are of the opinion that below 5400 levels, Nifty can show you 5000 levels or probably much deeper correction. We exited from our PE option also.

Bank Nifty Trading Strategy

In our weekly trading strategy, we asked our readers to go long only above 9450 levels, and Bank Nifty opens at 9425 and that was the high. Since from quite a few weeks, we were expecting 8800 levels, but it will come so fast, we had not expected it.

Keep visiting Way2Profits, for unbiased view on the market.

Nifty & Bank Nifty Trading Strategy for 18 June’13

Nifty as on 17 June’13– 5850.05 (+41.65)    Bank Nifty as on 17 June’13– 11971.05 (+48.10)

Nifty and Bank Nifty both moved higher in first day of the week. It seems that Bulls are betting aggressively, and Bears are cutting their hands. Whatever the case may be

Nifty Trading Strategy

As we mentioned in our weekly article, traders should wait for 5870 to break. Although looking at yesterday’s price action it seems effortless for Nifty. Above 5870 Nifty has first target of recent swing high of 5975.

Risk takers can go long in Nifty above 5870 with some financial stop loss. Traders can initiate Long Call Option Trading Strategy.

 Nifty Option Strategy – 18 June’13
Strike Price Options Recomm Lot Size Stop Loss
5900 CE 45 50 25

Bank Nifty Trading Strategy

Bank Nifty is still trading under risk, we would advise to wait for one more day.

Bank Nifty Long Strangle is also giving near about 60% return. I am sure many of you must have booked the position already, if not than book it.

At Way2Profits, we always give you unbiased view. Please, don’t take our ideas as trading recommendations, it is just for educational purpose only, and we don’t accept any responsibility for the same.

Nifty & Bank Nifty Trading Strategy as on 13 June’13

Nifty as on 12 June’13– 5760.20 (-28.60)    Bank Nifty as on 12 June’13– 11814.85 (-5.65)

It seems that after steep fall of last two sessions, Nifty and Bank Nifty took halt from falling spree. Both Nifty and Bank Nifty found support from its 200 Exponential Moving Average (EMA). Now whether this important average will be taken away or not will be a crucial point to watch for. If yesterday’s low will be taken away then it will be signal that weakness will persist.

Nifty Trading Strategy

Long strangle suggested was giving nearly 40% return, when high and low of call and put option taken together. Traders can book the position in an intraday. On closing basis strategy @ 62.

Bank Nifty Trading Strategy

Bank Nifty Long Strangle gave excellent return of 58% on high and low basis. I hope my readers must have minted good money from this strategy.

At Way2Profits, we always give you unbiased view.

Nifty & Bank Nifty Trading Strategy as on 12 June’13

Nifty as on 11 June’13– 5788.80 (-89.20)  Bank Nifty as on 11 June’13– 11820.50 (-266.55)

After almost five frustrating sessions, finally Nifty gave breakdown. Possibility of positive reversal was negated by give move below 5850. Bank Nifty opened gap down and continued its downswing.

Nifty Trading Strategy

We have suggested Long Strangle in Nifty @ 57, which is already running in profit closing of Long strangle prices are 67.90, technically speaking traders are getting return of more than 18% on invested capital of 2800, which is Not Bad. I advise my readers to hold this position and if you find return of more than 50% than start trailing stop loss. Enjoy the ride.

Bank Nifty Trading Strategy

Bank Nifty Long Strangle is giving more than 35% returns on invested capital. As expected Bank Nifty confirmed bearish signal given day before yesterday. Recommended Long Strangle @ 128 is running at @175. I am expecting Bank Nifty to test minimum 11500 level.

Keep visiting Way2Profits, for risk-less trading strategy. And I am sure if you continue to follow us, you’ll be benefited.

Nifty & Bank Nifty Trading Strategy as on 11 June’13

Nifty as on 10 June’13– 5878.00 (-3.00)     Bank Nifty as on 10 June’13– 12087.05 (-144.45)

 Market playing hide and seek with traders. Just see price change in last five trading sessions.

 Date Close Change
4/6/2013 5919.45 -19.85
5/6/2013 5923.85 4.4
6/6/2013 5921.4 -2.45
7/6/2013 5881 -40.4
10/6/2013 5878 -3

Nifty Trading Strategy

It is really difficult for taking a call on market, when you don’t get any conclusive move to decide for further action.  Bank Nifty made a low of 12017 but gave close above 12070 at 12087, but it seems that now Bank Nifty can continue to move lower.

Yesterday’s high low in Nifty will play decisive role to take action; 5935 on higher side and 5855 on the downside. Conservative traders should wait for going long in Nifty above 5975.

Continue reading

Bank Nifty Technical Analysis Outlook for 10 June, 13

Bank Nifty as on 07 June'13 - 12231.50 (-244.15) Weekly Chart

Bank Nifty as on 07 June’13 – 12231.50 (-244.15) Weekly Chart

Bank Nifty as on 07 June’13 – 12231.50 - Daily Chart

Bank Nifty as on 07 June’13 – 12231.50 – Daily Chart

In last five trading sessions of the week; Bank Nifty moved in a very narrow range with negative bias. Unfortunately, if you on short side than on Thursday your short were taken away, and if Long on Thursday then your stop would be taken away on Friday.

In such a tapered range what to expect further, let see-

  • Week on week basis Bank Nifty lost only 244.15 points, but consecutively it is third week where we got negative close, after posting life time high.

(To read further, download report)


Nifty & Bank Nifty Trading Strategy as on 4 June’13

Nifty as on 3 June’13– 5939.30 (-46.65)    Bank Nifty as on 3 June’13– 12402.10 (-73.55)

Nifty & Bank Nifty continued moving lower also on Monday, but CNX IT index moved higher as Infosys was in lime light. I saw many analyst were blindly betting on Infosys and giving some huge targets, I don’t know whether it achievable or not, but as far Technical’s are concerned I think, Infosys has turned lower exactly from 2625 which is crucial resistance point. Below this level I expect Infosys to stay in the mixed range, above which it enters into fresh bullish territory. What I am trying to explain is, if you don’t understand the basics than just don’t jump into such high volatile stock, even though you respect Mr. Narayan Murthy.

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Nifty & Bank Nifty Trading Strategy as on 29 May’13

Nifty as on 28 May’13– 6111.25 (+28.10)    Bank Nifty as on 28 May’13 – 12950.00 (-11.55)

In the last session, Nifty made a high of 6127.65 and turned back. Didn’t give us a chance to stay long.

Bank Nifty gave a Doji Candle, closed where it opened in the session.

According to my analysis, there is equal chance for Nifty to turn positive or negative, so I will not be surprised wherever it goes. If Nifty turns positive than CNX IT Index can be contributor to it, because Bank Nifty is less optimistic.

Nifty Trading Strategy

Traders can turn attention on long side above 6120-6130 level, with only 20-25 point stop loss. If not, than wait for time being.

In any case, Nifty moves and sustain above 6130 than traders can also Long Call of 6200 of next month expiry, but for which essential condition is close above this level, otherwise it is better to exit from position.

Traders can initiate Long Strangle in Nifty. Continue reading