Nifty & Bank Nifty Crashing This Week? (Expert Options Strategy Included!)

Successful trading is not rocket science. Yes, we all know that, but still we can see the majority of retail traders lose money. What’s the reason? Have you any idea? In my weekly analysis with options strategies post, I’m trying to answer a common problem we all face in our initial days. Read the post till the end to find the answer to why most people are losing.

In our starting days, we all face some similar problems. These problems not only gave us loss but destroyed our confidence too. These problems can be execution-related or can be psychology-related.

Execution-related problems: 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 to these 3 words “Why, when, and how” Your half of the problems will be solved. So before jumping into trading with real money, create a proper trading plan. Here are some of the tips that can help to build a trading plan for yourself.

• Don’t be fascinated by other’s profit. Everyone has their own expertise and their own risk appetite. So, before entering into the market, ask yourself which segment suits you. See, you can trade in any segment here and every segment has its own limitations and risk profile.
  • Always trade based on your risk profile. Risk profile means: how much you can effort to lose in a single trade. And you can see every segment has its own risk profile. So select a segment that 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 the bad trades too. There is no way to keep yourself away from these bad trades.
  • It’s better to keep yourself ready to deal with every worst problem you can face.

Come out from your comfort zone and look out for all the possible situations (good or bad) you can face when you will be in your trade. It will help to keep your back plan ready.

Psychology-related problems: We as a beginner retail trader, involve emotions while trading. Emotions 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? We don't have the answer to this "why".

This whole market is standing on fear and greed. People trade based on their emotions. They buy in greed and sell in fear.

But the market doesn't go like this. In fact, When you take any trade based on fear or greed, the next moment market will win. You have to learn how to overcome these emotions while making trading decisions.

So Don’t do that. Trade with logic 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.

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 discipline and patience.

I too have created a trading plan for myself 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 concerned about where the market will go tomorrow because I've hedged my risk. Less noise, more focus.

If you struggling to make your trading plan and want 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

If you look at the chart, you will find that after making an all-time high of 22775.75, we have seen a sharp decline due to profit booking from higher levels.

Now, 21700 - 21900 is acting as the immediate support zone and Nifty needs to hold this level for a new upside rally. A breakdown from this range will trigger some more panic selling and we may hit the next support level at 21000.

On the Upside, 22300 - 22400 is acting as the first resistance zone. A breakout will lead to the next resistance at 22700.

Now one thing you should keep in mind is that the overall trend looks bullish. There is some uncertainty due to the recent Iran-Israel war but it will settle soon.

The recent fall is giving us a good opportunity to invest for the long term. So instead of panicking, we should focus on some good quality stock to invest in.

For weekly proceptive, we can use a range of 21700 - 22400 for our range-bound strategies. Always follow your risk management rules.

• Check this also: Advance Course to Learn Intraday Option Strategies

Nifty Weekly Options Chain Analysis

Based on option chain data, the highest Open interest stands at 23000 CE & 22000 PE, followed by 22500 CE & 21700 PE. PCR of all strikes is 0.83, which indicates a neutral market. PCR at 21700 stands at 2.96, which is acting as an immediate support level.

The Put-call ratio at 22300 stands at 0.49, which is acting as a resistance level. Equally, important indicator Option Pain is at 22000, indicating weekly expiry at 22000. A shift in option pain will provide further levels of expiry. So keep tracking max pain.

Significant open interest buildup on the call side and you can see people are shifting their puts to lower levels especially 22300, 22200 & 22100 strikes, which indicates that the range is shifting towards lower levels. 

Keep tracking open interest to analyze market participant’s behaviour. If you don’t know how to analyze open interest for weekly option hedging strategies. Just enroll for our Option Strategies – A Mentorship Program.

BankNifty Weekly Analysis with Options Strategy

After a sharp decline from the higher levels, we saw that BankNifty is trying to take trendline support near 46500. If BankNifty manages to hold this range, we may expect some recovery from here in the coming week, or lower targets are waiting.

Right now, the short-term trend is UP but if banknifty gave a breakdown from 46500 then we may see the next target of 45800 and even lower.

Here is one thing you should keep in mind the market is highly volatile due to geo-polotical situations. So do not hold any naked trade here. I always prefer to hedge my overnight long position with PUTs. So do not keep any naked position in your account at least for the next few weeks.

Based on the current charts, the Weekly range in banknifty is 46500 - 47600. I suggest, trade with a proper hedge and keep your positions with limited risk on both sides.

• Check this also: TradePik's Premium Intraday Option Selling Strategies

Bank Nifty Weekly Options Chain Analysis

Based on option chain data, the highest Open interest stands at 48000 CE & 46500 PE, followed by 47500 CE & 46000 PE. PCR of all strikes is 0.78, which indicates a neutral market. PCR at 46500 stands at 4.68, which is acting as an immediate support level.

The Put-call ratio at 47500 stands at 0.43, which is acting as a resistance level. Equally, important indicator Option Pain is at 47000, indicating weekly expiry at 47000. 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.

Nifty & Bank Nifty Weekly Options Strategies

I have shared the weekly option strategies in Nifty and BankNifty for the coming week for the members only.

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