Hello guys, I hope you are doing well. In this edition of our weekly market newsletter (Weekly Indian Market Outlook), I will cover the weekly Indian market outlook, weekly chart analysis of the Nifty and BankNifty, and bank nifty weekly expiry options strategy for weekly income.
Before getting started on our weekly chart analysis and bank nifty weekly expiry options strategy, let’s talk about one of the main components of successful trading that the majority of people don’t know and end up losing huge amounts of money. That is “How to control emotions while trading”
How to control emotions while trading?
Trading in the financial markets can be an emotional roller coaster. The highs of a successful trade can be intoxicating, while the lows of a losing trade can be devastating. For traders, managing emotions while trading is crucial to success.
First and foremost, it is important to have a trading plan in place. This plan should outline the specific criteria for entering and exiting trades, as well as the amount of risk to be taken on each trade. Having a plan in place helps to reduce the emotional decision-making that often leads to poor trade decisions.
It is also important to have realistic expectations about the potential returns from trading. Many novice traders enter the markets with unrealistic expectations, leading to disappointment and frustration when these expectations are not met. By understanding the potential risks and rewards of trading, traders can better manage their emotions and avoid making impulsive decisions.
In addition, managing emotions while trading requires discipline and self-control. This means sticking to the trading plan, even when faced with a losing trade or the temptation to chase after a potential profit. It also means being able to take a step back and take a break when emotions are running high. Taking a break allows traders to clear their minds and refocus on their trading plan.
Another important aspect of managing emotions while trading is to avoid overtrading. Oftentimes, traders become overly eager to make a profit and enter too many trades at once. This can lead to rash decision-making and an increased likelihood of making mistakes. By limiting the number of trades, traders can better manage their emotions and focus on making well-informed decisions.
Furthermore, managing emotions while trading requires developing a strong sense of self-awareness. This means being aware of one’s own emotional state and how it can impact decision-making. By being aware of one’s own emotions, traders can better manage them and avoid letting emotions dictate their trading decisions.
Additionally, managing emotions while trading requires being able to handle the stress that comes with trading. The financial markets can be unpredictable and volatile, which can lead to high levels of stress. By developing effective stress management strategies, such as exercise and meditation, traders can better handle the stress of trading and avoid making impulsive decisions.
Finally, managing emotions while trading requires building a support network. This could include fellow traders, friends, and family members who can provide emotional support and guidance. By having a support network in place, traders can better manage their emotions and avoid making rash decisions.
I hope these tips have been helpful. Remember, a volatile market can be challenging, but with the right approach, you can still be successful.
Weekly Chart Analysis and Options Trading Strategies:
The market had a flat opening to the week and experienced high volatility compared to the previous few weeks this whole week. However, on Friday, the Nifty finished with a weekly loss of 1.07% and the BankNifty finished with a profit of 1.23%.
Weekly Chart Analysis of Nifty and BankNifty
Now let’s look at the weekly chart first to know the important levels:
If you look at the weekly charts of Nifty and BankNifty, you can easily find that both indices have given a breakout from their resistance zone and trading with a bullish trend. Now, what next?
Although Nifty has given a breakout from its resistance zone, I am still not convinced by this rally. So we have to wait for some confirmation about this sustainable breakout.
BankNifty is trading with a bullish trend and is ready to hit a new high in the coming session based on the current weekly chart.
Now let us look at the daily chart.
Daily Chart Analysis of Nifty and BankNifty
Let’s start with the Nifty chart first. After a successful breakout from 18500, the Nifty made a high of 18887.60. But couldn’t sustain and we have seen a sharp decline from day high and closed below 18500.
Now, this 18200 to 18500 is the range that is important in terms of further movement. A breakout from 18500 will lead to new upside levels and a breakdown from 18200 will again drag it into the territory of bear.
Trade Plan for the coming week: If the Nifty manages to stay above 18500 this week, you can place a long bet above that level. Else trade with a range-bound strategy. I will share my Intraday trades based on the trend-following method in our telegram channel. Join through the below button.
Despite downside movement in Nifty, BankNifty looks strong and traded in a range with a bullish view this week. In fact, made a new high on Friday which is a good sigh for bulls and we can expect some more upside levels in the coming week.
Important levels to keep on the radar this week in BankNifty is 43300. If manage to sustain above then it can hit a new high of 44800 in the coming trading sessions.
Tip for the week: Don’t go long or short very aggressively. Let the market give a proper indication and then enter in any trade. Go long above 43300 only if banknifty manages to sustain above this level.
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Bank Nifty Weekly Expiry Options Strategy for Coming Week
In the above section. we have analyzed the chart and found the range based on the chart. Now before we create any Nifty or Bank Nifty Weekly Expiry Options Strategy, let’s look at the open interest data to check the range for the coming week.
- Nifty Open Interest Analysis:
- Highest OI is at 18000 PE & 18600 CE. The support is at 18200 & Resistance is at 18800 for the coming weekly expiry.
- Max pain is at 18600.
- BankNifty Open Interest Analysis:
- Highest OI is at 43500 PE & 44000 CE. The support is at 43000 & Resistance is at 44000 (based on PCR data) for the coming weekly expiry.
- Max pain is at 43500
Based on the OI data, the range is very wide but due to low volatility premiums are also very low. So today, I’m sharing a premium strategy that has a high probability of success in BankNifty only.
Bank Nifty Weekly Expiry Options Strategy for December 15, 2022
You can see this strategy has a 50% probability of success. For risk management, you can keep a stop loss of ₹8000 as MTM loss.
We teach this and other nifty and banknifty option strategies in our course. You can enroll to learn the weekly expiry strategy with predefined rules of entry and exit.
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Much Check this also-
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Post your comments in the comment box if you have a query related to this weekly Indian Market Outlook. You can ask any question related to bank nifty weekly expiry options strategy in the comment box.
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DISCLAIMER: We are not a SEBI research analysts. Views and trading strategies are posted in this weekly market newsletter 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 aware of the risk inherent in securities trading.