Hello folks! Hope you are safe and healthy in this COVID-19 pandemic. On our website, I’m sharing some good options strategies, so that all can make money together. Today I’m sharing an Iron condor strategy as a Monthly Income Option Strategy in Bharti Airtel.
Why I choose Iron Condor as Monthly income option strategy?
If you want to earn consistently in this stock market, then you must focus on your risk management. Your risk must be limited to overcome the loss due to an unexpected movement in the market.
As we both know that the market will not be going to touch the sky tomorrow nor it will touch the ground. It will remain in a range. It may give us one-sided movement but will go till a limited level. So if we can find a range, and creating our strategy based on that range chances are high to make money.
One more thing we should keep in mind here that Market is full of surprises. Every small or big news can give us an unexpected movement, so we should keep our risk on limited side. Because if anything goes wrong, our loss would be limited.
Iron condor strategy is a limited risk option strategy and works well with a range-bound activity in the stock. It will not only help to make money in a range-bound activity but will help to manage our risk too. That’s the reason I loved this strategy most.
I have shared a detailed article about how to deploy an Iron condor strategy in any stock. You can go through that article for better understanding.
In this next section, I will share how we can find the range based on the chart and Open Interest data for our Monthly Income strategy in BHARTIARTL. I will share the strategy with its adjustments. So read this post till the end to understand better. If you have any query, question, or suggestion, can type in the comment box.
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Monthly Income Option strategy in BHARTIARTL
Let’s look at the chart to analyze the range of BHARTIARTL for coming expiry.
After gave a breakdown from 540, we saw a sharp decline in BHARTIARTL. It took support around 400 – 380 and gave some recovery from lower levels. Now 500 – 520 is acting as a strong resistance zone.
So based on the chart, we can say that 380 – 420 is the range we can expect in the coming session. We may see some range-bound activity until we are not getting any breakout or breakdown from this range.
For more confirmation, we should analyze the November month expiry data too.
Open Interest analysis for BHARTIARTL
Based on the Open interest data, we can see 400 PE and 500 CE carries the highest Open interest. This indicates that these levels are acting as immediate support and resistance respectively.
This is confirmed with Open interest that 380- 520 can be the range in BHARTIARTL for the coming sessions. So, we can use this range to make a Monthly Income option strategy, i.e. Iron Condor strategy.
Monthly Income Option strategy in BHARTIARTL
Possible adjustments for the Iron Condor strategy
You can follow these adjustments:
First, you can follow these breakevens (394 – 506) as a stop-loss means you can close your strategy after a breakout or breakdown from this range.
If the loss is more than 6000₹, close this strategy.
Shift your call spread to 450 after a breakdown from 390. Means book profit in existing call spread and initiate a new call spread with 450 CE SELL and 470 CE BUY.
Same thing you can do with PUT spread after a successful breakout from 520. Means shift your put spread to 450 i.e short 450 PE & BUY 430 PE
If you want to learn these monthly income option strategies with proper adjustments you can enroll in our Option Strategies – A Mentorship program.
I hope my articles are helping to trade with these options strategies. Which strategy you are using to generate your pay-check? Do let me know in the comment box.
Options Strategies – A Mentorship Program
On the 1st of September 2019, We have launched a new mentorship program for Option strategies, in which we are discussing 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?
DISCLAIMER: – we are not a SEBI research analyst. Views and the iron condor strategy posted here only for educational purposes. There is no liability whatsoever for any loss arising from the use of this article 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.