Successful trading is not rocket science. Yes, we all know that but still, we can see most of the retail traders are losing money. What’s the reason? Have you any idea? In my weekly analysis with options strategies post, I’m trying to give the answer a common problem we all are facing in our initial days. Read the post till the end to find the answer why most of the people are losing?
In our starting days, we all face some similar problems. These problems not only gave us loss but destroy our confidence too. Some problems can be execution related or some of these problems can be our psychology related.
Execution related means: We don’t have a proper trading plan. Trading plan like, Why to entre? When to enter or exit? and How to execute this plan?
If you know the answers of these 3 words “Why, when and how” Your half of the problems will solve. So before jump into trading with real money work on a proper trading plan. Here are some of the tips which can help to build a trading plan for yourself.
- Don’t be fascinated by other’s profit. Ask yourself which segment suits you. See you can trade in any segment here and every segment has own limitations and risk profile.
- See everyone has their unique risk profile. Risk profile means: how much you can effort to lose in a single trade. And you can see every segment has it’s own risk profile. So select a segment which suits you.
- If you trade with your risk profile, It will help to take some better decisions when things go wrong. And remember this, you will get wrong trades too. There is no way to keep yourself away from these wrong trades.
- It’s better to keep yourself ready to deal with every problem you can face.
Come out from your comfort zone and look out all the possible situation you can face when you will be in your trade. It will help to keep your back plan ready.
Psychology-related means: We as a retail trader, trading with emotional decisions. Emotional decisions like fear and greed. We are making decisions based on gut feelings. We think that now this stock will go UP that’s why we are taking a long trade. But why it will go UP? We don’t know.
Want to know a secret? This whole market is standing on fear and greed. When you take any trade based on fear or greed, the next moment market will win. You have to learn how to overcome from these emotional trading decisions.
[su_highlight]So Don’t do that. Trade with logics not with gut feelings. We have to be very clear about why we are taking this trade. Make a trading plan and then follow it with proper discipline and patience.[/su_highlight]
My dear friends, There is no shortcut to success. If you want to be a successful trader, You have to work on both things.
In short: Make a trading plan based on your risk profile and follow it with proper discipline and patience.
I too have created a trading plan for me and following that plan only. My trading plan is simple. I’m trading with option hedging strategies. These strategies are helping to keep my risk on the limited side.
Now’ I’m not bothered about where the market will go tomorrow. Less Noise and more focus. If you struggling to make your trading plan and wanted me as your Mentor, you can join our mentorship program, where I will teach you how to deploy these strategies and what should be the adjustment if the script is moving against your prediction.
Nifty weekly analysis with options strategies
From the 2 weeks, Nifty is trading in No-trade zone. No-trade zone is 8950 – 9650. This zone is very crucial in term of short to medium-term trend.
A breakdown from 8950 will lead to lower levels. 8050 is the next support level if we got a breakdown.
On upside 9650 is acting as a strong resistance level. A sustainable breakout is required to get some sustainable recovery in the market
You can see Volatility has started to come down and we can see around a 50% drop in the volatility from higher levels. Which is a good sign that somewhere market is trying to come in its previous range?
So based on technical, 8950 – 9650 is the range we need keep on radar for next few weeks. Let’s wait for some clear indication for a long or short trade. Till then trade with limited risk range-bound strategies only.
Nifty weekly Options Chain analysis
Based on option chain data, the highest Open interest stands at 9500 CE & 9000 PE, followed by 10000 CE & 8500 PE. PCR of all strikes is 1.16, which indicates a neutral. PCR at 9000 stands at 2.31, which is acting as an immediate support level.
The Put-call ratio at 9500 stands at 0.38, which is acting as a resistance level. Equally, important indicator Option Pain is at 9200, indicating weekly expiry at 9200. A shift in option pain will provide further levels of expiry. So keep tracking max pain.
Significant open interest buildup on both the side, which indicates that the market is facing support from both the side.
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 weekly Options Strategy: Iron Condor
Initially, you can keep a stop loss of 9550 & 8950 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 8950, then square off call spread and bring it down to 300 points lower levels.
The same thing you can do with put spread means if you got a breakout from 9550. You can shift your put spread to 300 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(33% OFF).
BankNifty Weekly Analysis with options strategy
In the last weekly analysis and options strategies post, I have shared that Banknifty is trading in a range of 20700 to 18000. This week, Banknifty tried to break 20700 but couldn’t sustain above that level.
Here, keep one thing in mind that that till bank nifty is holding 23000, we can’t say that now the trend has changed. 20700 – 23000 is a no-trade zone. We should go long only above 23000.
Below 20700, trend is down. We can carry your short trade here. But I feel till bank nifty is holding 20700 – 18000, we should trade with sideways strategies.
Right now IV is decreasing and giving you a good opportunity to keep some credit spreads in your account. So focus more on credit spreads with limited risk on both sides.
Bank Nifty Weekly options chain analysis
Based on option chain data, the highest Open interest stands at 21000 CE & 19000 PE, followed by 20000 CE & 18000 PE. PCR of all strikes is 1.08, which indicates a neutral market. PCR at 19000 stands at 7.21, which is acting as an immediate support level.
The Put-call ratio at 21000 stands at 0.07, which is acting as a resistance level. Equally, important indicator Option Pain is at 19700, indicating weekly expiry at 19700. A shift in option pain will provide further levels.
Remember one thing: When IV is high, data can change anytime so keep following more closely.
If you don’t know how to analyze open interest. Just enroll for our Option Strategies – A Mentorship Program.
Bank Nifty best Weekly Options Strategy: Iron Condor
If you find that BankNifty gives a breakdown and sustaining below 18800, then Shift your Call spread to 1000 points down.
The same thing you can do with put spread means if you got a breakout from 21000. You can shift your put spread to 1000 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(33% OFF).
Much Check this also– Performance of the Option strategies, Nifty & BankNifty Weekly Analysis with Option strategy, Nifty Option Strategy for Budget Session, A low-risk options strategy in LICHSGFIN, An iron condor options strategy in ICICIBANK, Reverse Jade Lizard options strategy in UPL, A high probability options strategy in YESBANK
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*( Please avoid any question like which Call or Put we should buy in the coming week).
Options Strategies – A Mentorship Program
On September 01, 2019, We have launched a new mentorship program for Option strategies, in which we’ll discuss how can we deploy these strategies? What rules we should follow before taking a trade? And what should be our adjustments if the script is moving against your direction?
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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.