Category Archives: Long Straddle

A long Straddle is a volatility strategy and is used when the stock price / index is expected to show large movements. This strategy involves buying a call as well as put on the same stock / index for the same maturity and strike price, to take advantage of a movement in either direction, a soaring or plummeting value of the stock / index

Nifty & Bank Nifty Trading Strategy as on 14 May’13

Nifty as on 13 May’13– 5980.45 (-126.80)       Bank Nifty as on 13 May’13 – 12568.85 (-211.30)

Nifty witnessed a sharp reversal, after steep rise of last twenty trading sessions, negating upside continuation. Lastly Nifty posted high of 6114.55, made a double top and turns lower.

Nifty Trading Strategy

I had given Nifty option Long Strangle Strategy.

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Bank Nifty Technical Outlook for 13th May’13

Bank Nifty as on 10 May’13 – 12752.30

Bank Nifty as on 10 May’13 – 12752.30

From above chart of Bank Nifty, few things I would like to high light here.

  • Bank Nifty is moving in a channel from quite a long time, and in recent past it is stuck near a trend line and consolidating here from last twelve trading sessions.
  • If we compare weekly chart, than in last week Bank Nifty made a high of 12783.30 and in last week it made a high of 12783.05. Exactly same high. Only significant difference between prior week’s high and last week’s high is, closing. In the last week Bank Nifty closed near highs, whereas in prior week, it closed near lows.
  • On 29th Jan’13 Bank Nifty made a high of 12960.65 and took a U turn. Now Bank Nifty is very close to this high.
  • As depicted in attached momentum oscillator RSI (14) is showing potential negative divergence, but situation is different on weekly chart, which suggest continuation of trend. This disparity is seemingly reflected in price action, as moving in choppy way from last couple of days.

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