Hello folks! Hope you are safe and healthy. Every week, I’m sharing this weekly article to analyze what is the nifty and bank nifty trend today with weekly options strategies for both indices.
Every week I’m sharing some important tips too that can help you to be a more mature trader. If you are new and not following my blog, you should look at the previous articles too.
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Many times I have shared in my previous articles that
Why I’m saying that? Because we are living in a world that is changing every day. Whatever we are analyzing today will not be valid for tomorrow. Tomorrow will bring a new picture for us. So we are unable to convert our position based on further analysis, it will be difficult for us to generate some consistent return from this market.
Let’s say; you have taken a long trade in bank Nifty today because you saw that trend is Bank nifty trend today is UP. What will you do if tomorrow’s direction has changed? How will you manage your trade? What adjustments will you make in your position to convert the sentiment of your trade?
These are the questions you should keep in mind before entre into a trade. Proper trade management is the key to success in this market.
That’s is the main reason. I have started with option strategies. These strategies are giving us the freedom to manage our trade more efficiently. If we have taken a bullish trade, we can change the direction to bearish with just a few adjustments. And the best part is, no need to make any decision in a hurry. You can wait if you find there is a breakout or breakdown from a critical level.
As you know, 80% of breakouts are false breakouts. If you find a breakout from your breakevens, you can wait for the confirmation that it’s a valid breakout of the false one Because your position is hedged. You don’t need to bother about any global or domestic news that can trigger a fresh buying or selling in the market tomorrow.
You know how much is the max loss in this position. Now you will find yourself in a better place to make some right decisions because your decisions are free from emotions. Now, if you think this is the correct way to trade and wanted to learn how to trade and adjust, these option strategies can join our Mentorship program. Click the below button for more details.
Nifty trend today with weekly option strategies
After spending almost 6 weeks in a range of 15500 – 15900, Nifty gave a breakout and traded above 16000 in the last whole week. I have shared in the last weekly analysis and option selling strategies post that 15900 – 16000 has become a good support zone now and 16450 – 16500 is the new resistance here.
On 13th August, Nifty gave a breakout from 16500 and On 16th August (Monday) Nifty respect that level and traded above 16500 which leads to a new all-time high of 16701.85 on 18th August i.e. on Wednesday.
However, some decline from the higher levels on Wednesday and a Gap-down opening on Friday, Still Nifty is showing some good strength on Upside and trying to hold its new support zone of 16450-16500.
Now, 16450 & 16700 are the two important levels that we should keep on the radar. A breakdown from 16450 will lead to 16000 and A Breakout from 16700 will leads to its new all-time high of 17000.
The overall trend is UP and there is no sign of weakness. So any short trade is not advisable here. Based on the charts, 16200 – 16700 is the range we can expect for the coming week.
Nifty trend today based on the option chain analysis
Based on option chain data, the highest Open interest stands at 16500 CE & 16400 PE, followed by 16600 CE & 15000 PE. PCR of all strikes is 1.14, which indicates a neutral market. PCR at 16300 stands at 3.84, which is acting as an immediate support level.
The Put-call ratio at 16600 stands at 0.24, which is acting as a resistance level. Equally, important indicator Option Pain is at 16450, indicating weekly expiry at 16450. A shift in option pain will provide further levels of expiry. So keep tracking max pain.
Significant open interest buildup on-call sides. Indicating that Nifty is facing good resistance from the Upperside. So based on the OI, the possible range for this week should be 16300 – 16600.
Keep tracking change in open interest to analyze market participant’s behavior, so that you can adjust your position accordingly. If you don’t know how to analyze open interest to find nifty and Bank Nifty trend today for option selling strategies. Just enroll for our Option Strategies – A Mentorship Program.
Nifty option Strategy: Iron Condor
Initially, you can keep a stop loss of 16250 & 16650 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 2000₹).
If you find that Nifty is giving a breakdown and sustaining below 16250, 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 16650. You can shift your put spread to 300 points up.
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Bank Nifty trend today with weekly option hedging strategies
If you look at the chart, you can see clearly that Bank nifty is trading a tight range of 34000 – 36000. A breakout or breakdown required for further levels.
Based on the Fibonacci Retracement tool. 36000 is the 78.6% level which is very crucial for the further upside levels. A successful breakout will give us a good opportunity to go long for a target of 37700 on the UPside. Here 35800 – 36200 is acting as a strong resistance zone that needs to break for further upside levels.
The current trend in BankNifty is sideways but on the downside, 34000 is acting as a strong support level here. A breakdown will give us a new sell signal in Banknifty. So If you are holding a long trade, keep your risk management on the higher side.
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Bank Nifty trend today based on the option chain analysis
Based on Bank nifty option chain data, the highest Open interest stands at 36000 CE & 35000 PE, followed by 37000 CE & 34500 PE. PCR of all strikes is 0.72, which indicates a neutral market. PCR at 34500 stands at 10, which is acting as an immediate support level.
The Put-call ratio at 35500 stands at 0.38, which is acting as a resistance level. Equally, important indicator Option Pain is at 35200, indicating weekly expiry at 35200. A shift in option pain will provide further levels.
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Bank Nifty weekly expiry Strategy: Iron Condor
If you find that BankNifty gives a breakdown and sustaining below 34300, 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 35700. 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 Nifty and Bank Nifty trend today with option strategies. You can ask any question related to option trading in the comment box.
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*( Please avoid any questions 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.