Weekly Expiry Analysis with Option hedging strategies for 27th Feb Exp

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Hello friend, I hope you are doing good. I know successful trading is a tough job. We have to follow our system with proper discipline and patience. I started this weekly expiry analysis with Option hedging strategies blog post to help with the knowledge and experience I have gained from my eight years trading career.

When we start our trading career, the first obstacle we face is how to create a profitable trading system. We all are keeping more focus on a holy grail which can generate a good return for us.

But every system has its own limitations. A good trading system is just one step. If you want to make money from that system, you need to focus on trading psychology first. Trading psychology is the thing that will create a real difference in your trading journey.

When I started my trading career I was too searching for a good trading system but later I realized that no system will work if you don’t have that mindset. The correct mindset is required to follow a system with proper discipline and patience.

And I think this is the main reason behind the different outcomes we are getting from the same trade but from two different peoples. Once we are not getting that outcome we start blaming or asking ourselves that is this system works?

I think both are right, the problem is trade management. One is managing his trade well that’s why the outcome is different. So my suggestion here is to focus on trading psychology first and then trade management. If you can manage your trade well, you will get a desirable return even from the simplest trading system.

Two books I’m recommending if you are a beginner:

  1. Come Into My Trading Room: A Complete Guide to Trading – Alexander Elder
  2. The New Trading for a Living: Psychology, Discipline, Trading Tools and Systems, Risk Control, Trade Management

These two books help me lots to change my mindset to put my efforts in the right direction.

Nifty Weekly Analysis with Option hedging strategies

Nifty Chart today

This week was very tough for the option writers like us. We saw a huge decline on Monday and Tuesday. Later in the last hour on Tuesday, we saw a sharp recovery that continues on Wednesday too.

12000 is a very crucial support. The next support level which is very important in terms of trend is 11800. A breakdown from 11800 will change the trend from positive to negative.

On the upper side, 12300 – 12350 is the strong resistance zone and a breakout is required for further upside levels.

12000 – 12300 is the range I’m expecting for the February expiry week. We should keep tracking the data for further levels.

Nifty weekly Options Chain analysis

Options Chain analysis

Based on option chain data, the highest Open interest stands at 12200 CE & 12000 PE, followed by 12300 CE & 11900 PE. PCR of all strikes is 1.04, which indicates a neutral market. PCR at 12000 stands at 3.15, which is acting as an immediate support level.

The Put-call ratio at 12200 stands at 0.35, which is acting as a resistance level. Equally, important indicator Option Pain is at 12100, indicating weekly expiry at 12100. A shift in option pain will provide further levels.

Significant open interest buildup on the call side, Especially 12100 CE, 12150 CE and 12200 CE which indicates that the market is facing some resistance from high levels. Based on Option chain data, 12000, 11900 are good support levels and 12200 & 12300 are good resistance levels for this expiry.

Keep tracking open interest to analyze market participant’s behavior. If you don’t know how to analyze open interest for weekly option hedging strategies. Just enroll for our Option Strategies – A Mentorship Program.

Nifty Option hedging Strategy: Iron Condor

Nifty weekly option hedging strategy

This week we are creating strategies with 5th march expiry.

Possible adjustments:

Initially, you can keep a stop loss of 11900 & 12300 for this strategy. Means square off if you find nifty is giving a breakout or breakdown. Or you can do this adjustment too.

If you find that Nifty is giving a breakdown and sustaining below 11950 then square off 12200 CE & 12350 CE in profit, and short 12000 CE and buy 12250 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 150 points up.

If you want to learn these strategies and their adjustments in more practical ways with live mentorship, You can enroll in our Option Strategies – A Mentorship Program.

BankNifty Weekly Analysis with option strategies

bank nifty chart today

As I shared in my last weekly analysis and option hedging strategies post, 30500 – 31000 is acting as a strong support zone for bank nifty. Although Bank nifty was trying to give a breakdown from 30500 on Tuesday. Later we saw a sharp recovery in the last hour that manages to sustain above 31000.

Technically bank nifty is in a no-trade zone and a new short or a long trade not advisable. We should initiate a new trade only after a successful breakout or breakdown from 31500 to 30500. This could be the range for the coming week.

Bank Nifty Weekly options chain analysis

bank nifty open interest analysis

Based on option chain data, the highest Open interest stands at 32000 CE & 30500 PE, followed by 31500 CE & 30000 PE. PCR of all strikes is 1.05, which indicates a neutral zone. PCR at 30500 stands at 3.78, which is acting as an immediate support level.

The Put-call ratio at 31500 stands at 0.15, which is acting as a resistance level. Equally, important indicator Option Pain is at 31000, indicating weekly expiry at 31000. 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.

BankNifty Weekly Options Strategy: Iron Condor

BankNifty Weekly Option hedging Strategy

Possible adjustments:

If you find that BankNifty gives a breakdown and sustaining below 30500, then Shift your Call spread to 400 points down.

The same thing you can do with put spread means if you got a breakout from 31500. You can shift your put spread to 400 points up.

If you want to learn these Weekly expiry option strategies and their adjustments in more practical ways with live mentorship, You can enroll in our Option Strategies – A Mentorship Program.

Much Check this alsoTrading Psychology: The Challenge of Trading, Election Result Day strategy for nifty, Stock Market for beginners: Essential guide, Weekly Analysis and Option Strategies, Why people lose money in a falling market?

Post your comments in the comment box if you have a query related to the Weekly option hedging strategies. You can ask any question related to option trading in the comment box.

If you need More real-time assistance on Nifty and Bank nifty weekly expiry options strategies Can take our premium subscription or open a trading account with us and you will get real-time assistance every month on these weekly options strategies. You can contact us on WhatsApp

*( Please avoid any question like which Call or Put we should buy in the coming week).


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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.

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8+ Years working as a derivative trader, Option Writer, Blogger, Trader by passion, Keen Follower of Indian share market

2 thoughts on “Weekly Expiry Analysis with Option hedging strategies for 27th Feb Exp”

    • A simple step is Short Call and PUT based on Highest Open Interest. Like if nifty is trading at 11600 and Highest OI is at 12000 CE and 11400 PE then short 12000 CE and 11400 Pe and buy further OTM strikes to hedge your positions.

      Reply

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