Hey Folks! I hope you are safe and healthy in this COVID-19 pandemic. Every week in this weekly article, I’m sharing some valuable tips you should follow to be a disciplined trader along with weekly nifty and bank nifty option strategies for coming expiry.
Today I will talk about a common mistake people are doing when getting continuous loss for a few days. I have seen many times that after loosing in a few trades, they took trade with high-risk and high reward. They think that trade alone can compensate for the loss they have got in the last trades.
This is the biggest mistake one can make. This one mistake can kick out from market. So, what to do when you get continuous loss in few trades?
The first step is: take a pause. Stop whatever you are doing. The market is not going anywhere. You can board it anytime again.
The market is all about Money. It respects those who respect their Money. So instead of taking trades like a gambler to lose Money, take a pause and analyze what you are doing. Try to find the mistakes you are making.
Second thing you should do is: Focus on Risk management. Successful trading is not about just placing trades. It’s all about placing a trade with proper risk management. Risk management is the only key to success in this market.
When we get continuous loss in a few trades, our risk-taking capacity has already gone down. Now if we take a higher risk this time and anything goes wrong, that one trade can hit us so badly. We may lose most of the capital, and it will destroy our confidence too.
I have seen many people are looking only at the reward but my dear friend higher reward comes with higher risk. If we take higher risk when our Risk-taking capacity is already low, it will kick out from this market.
Trade with the discipline not with the emotions. Trade with proper setup not with the guts. If something is not working, take a pause, try to find the mistakes. Based on your mistake, optimize your system. And then try again. This is the only way to succeed in this market.
Successful trading required discipline to follow your system and patience to get your desirable result. So trade with proper discipline and patience. And keep practicing. Practice with virtual money first and if you are getting enough success, then only you should start with real money.
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Weekly Nifty option strategies for 15th October Expiry
After made a low of 10790.20 on 24th September 2020 we saw a sharp recovery from lower levels. As I have shared in the last weekly article that 10800 – 11000 is the strong support zone and Nifty needs to sustain below for further downside levels. On the upside, 11600 – 11800 is the resistance that need to break for further upside levels.
This week we saw that Nifty has given a good breakout from 11600 – 11800 resistance zone and trying to sustain above this resistance zone. If Nifty manages to sustain above this zone our next targets can be 12000 & 12250.
On the downside, 10800 – 11000 is the strong support zone and a sustainable breakdown required for a new sell signal.
Nifty is in a complete Uptrend but 12000 is a strong psychological level that need to break for further upside levels. Here one thing you should keep in mind that after this good rally we can see Volatility is increasing which is generating a caution signal that a profit booking can happen.
So keep your positions with proper hedge and trade with a good risk management plan.
Nifty weekly option chain analysis
Based on option chain data, the highest Open interest stands at 12500 CE & 11700 PE, followed by 12000 CE & 11800 PE. PCR of all strikes is 1.22, which indicates a slightly overbought market. PCR at 11500 stands at 9.57, which is acting as an immediate support level.
The Put-call ratio at 12000 stands at 0.16, which is acting as a resistance level. Equally, important indicator Option Pain is at 11800, indicating weekly expiry at 11800. A shift in option pain will provide further levels of expiry. So keep tracking max pain.
Significant open interest buildup on PUT sides. Indicating good support from lower levels. So based on the OI, the possible range for this week should be 12200 – 11600.
Keep tracking change in open interest to analyze market participant’s behaviour, so that you can adjust your position accordingly. If you don’t know how to analyze open interest fo find the best Weekly nifty and bank nifty option strategies. Just enrol for our Option Strategies – A Mentorship Program.
Weekly Nifty option Strategies: Iron Condor
Initially, you can keep a stop loss of 11650 & 12150 for this strategy. Means square off if you find nifty is giving a breakout or breakdown. Or you can do this adjustment too. ( Do not hold this strategy is loss is more than 2500₹).
If you find that Nifty is giving a breakdown and sustaining below 11650, 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 12150. You can shift your put spread to 300 points up.
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Weekly Bank Nifty Option Strategies for 15th October Expiry
In the last weekly article I have shared that 23000 – 23200 is the strong resistance zone and a breakout will give us some new upside levels.
This week we saw an excellent rally that helped Bank Nifty to close above the previous resistance zone (23000 – 23200). Now if Bank Nifty manages to sustain above this zone, we may see some upside movement till 24400 & 25200.
On the downside 21000 – 20000 is acting as a strong support zone and new sell signal will trigger only after a sustainable breakdown from this zone.
Based on the charts, 25400 – 23400 can be the range until we are not getting any clear breakout or breakdown in the coming sessions.
Weekly Bank Nifty option chain analysis
Based on Bank nifty option chain data, the highest Open interest stands at 24000 CE & 23000 PE, followed by 24500 CE & 22500 PE. PCR of all strikes is 1.32, which indicates a overbought zone. PCR at 23000 stands at 4.72, which is acting as an immediate support level.
The Put-call ratio at 24000 stands at 0.12, which is acting as a resistance level. Equally, important indicator Option Pain is at 22500, indicating weekly expiry at 22500. A shift in option pain will provide further levels.
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Bank Nifty option Strategies: Iron Condor
Possible adjustments for this best Bank Nifty option Strategies are:
Follow a stoploss if the max loss is above 4100₹, close this strategy.
If you find that Bank Nifty gives a breakdown and sustaining below 22800, 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 24600. You can shift your put spread to 1000 points up.
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Post your comments in the comment box if you have a query related to the weekly analysis and Best Nifty and Bank Nifty option Strategies. You can ask any question related to option trading in the comment box.
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*( 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 or the weekly analysis with nifty and bank nifty option strategies 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.