Hello guys. I hope you all are doing good. In this Nifty and Bank nifty Weekly analysis and bank nifty weekly Option strategy post, I’m trying to share my trading plan based on my setup.
Like How I’m calculation a range and based on that range I’m selection an option strategy for the coming week. I’m getting good feedback which is encouraging me to do something better for you.
In this weekly analysis post, I’m trying to share whatever I have learned in my 8 years of a trading career. I hope my experience is helping you to make some better decisions.
In the last few months, we saw very high volatility. High volatility is bringing some good opportunities to make good returns but bringing high risk too. From November we can see that volatility has reduced and the market is trying to come in its previous stage.
This is a good sign for us. We can create some high probability non-directional strategy in the market to generate some consistent return.
You can see that 70% of the time market consolidates in a range. So If we are creating a non-directional strategy, Chances to make money is higher compared to a directional strategy. Because 70% accuracy, the market itself giving to us.
That’s the main reason I prefer some no-directional strategies instead of Directional strategies. Now let us look at the chart and option chain data for the coming week to deploy a strategy.
Nifty weekly analysis with option strategy
In the last weekly analysis post, I shared that 11800 – 12100 is the range for nifty. We may see some range-bound activity until nifty is trading between this range.
The same we saw this week. Nifty gave a breakdown from 11900 on 10th December, but couldn’t manage to sustain below 11800. Took support around 11850 and we saw a good rally in the last three trading sessions.
As I told you earlier, This market is a Buy-on-dips market and we should look at the buying opportunities instead of a short trade with every fall in Nifty.
Now 12100 – 12150 is the resistance zone for nifty, we may see further upside levels only after a successful breakout from this zone. On the downside 11900 – 11800 is a strong support zone.
Nifty Option Chain analysis
Based on option chain data, the highest Open interest stands at 12100 CE & 12000 PE, followed by 12000 CE & 11900 PE. PCR of all strikes is 1.27, which indicates an overbought market. PCR at 11900 stands at 2.85, which is acting as an immediate support level.
The Put-call ratio at 12100 stands at 0.45, which is acting as a resistance level. Equally, important indicator Option Pain is at 12000, indicating weekly expiry at 12000. A shift in option pain will provide further levels.
Significant open interest buildup on PUT sides, Especially 12100 PE, 12050 PE & 12000 PE, which indicates that the market is trying to take some support from lower levels. Based on Option chain data, 11900, 12000 are good support levels & 12100 & 12200 are good resistance levels for this expiry.
Keep tracking open interest to analyze market participants’ behavior. If you don’t know how to analyze open interest. Just enroll for our Option Strategies – A Mentorship Program.
I have started a new Youtube channel where I’m posting daily analysis based on charts and Open Interest data in Hindi. Many people were saying that I should start something for those who are more comfortable in Hindi. So I started that youtube channel.
Nifty Weekly Option Strategy: Iron Condor
If you find that Nifty gives a breakdown and sustaining below 11950, then square off 12150 CE & 12300 CE in profit, and short 12050 CE and 12200 CE.
The same thing you can do with put spread means if you got a breakout from 12250. You can shift your put spread to 100 points up.
Bank Nifty Weekly analysis with option strategy
You can see Bank nifty is trading in the range of 32000 – 31000. In the last weekly analysis and option strategy post, I shared that 31000 is a very strong support level.
It has to be broken if Bank nifty wants to touch lower levels. The same level we are keeping as a stop loss in our long trade in bank nifty. A new long trade we can initiate if Banknifty manages to sustain above 32000.
Bank Nifty option chain analysis
Based on option chain data, the highest Open interest stands at 32000 CE & 31500 PE, followed by 32500 CE & 31000 PE. PCR of all strikes is 1.28, which indicates an overbought market. PCR at 31500 stands at 3.52, which is acting as an immediate support level.
The Put-call ratio at 32500 stands at 0.08, which is acting as a resistance level. Equally, important indicator Option Pain is at 32000, indicating weekly expiry at 32000. A shift in option pain will provide further levels.
If you don’t know how to analyze open interest. Just enroll for our Option Strategies – A Mentorship Program.
Bank Nifty Weekly Option Strategy: Iron Condor
If you find that bank Nifty gives a breakdown and sustaining below 31500, then square off Call spread and shift it to 300 points lower.
The same thing you can do with put spread means if you got a breakout from 32500. You can shift your put spread to 300 points up.
To learn the advanced adjustments, you can enroll to our Option Strategies – A Mentorship Program
Much Check this also- Modified Condor Option Strategy in VEDL, Bull Call Ladder in ZEEL, Iron Condor in SBIN, Weekly Analysis & Option Strategies For 10th Oct Exp, Why People Lose Money & Nifty and Bank nifty index analysis with Option Strategy
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DISCLAIMER: – we are not a SEBI research analyst. Views posted here only for educational purposes. There is no liability whatsoever for any loss arising from the use of this product or its contents. This product is not a recommendation to buy or sell, but rather a guideline to interpreting specified analysis methods. This information should only be used by investors and traders who are aware of the risk inherent in securities trading.