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- What are options and how I'm generating my Monthly Cheque with options strategies?
Every day we are placing many trades. If we analyse this trade, we find that more than 50% of the trades are profitable. But when we look at our own performance, We find that we made money in 10-20% traders only. What’s the reason? Every week in my weekly analysis and options strategies post I’m trying to solve your one problem. Today we will discuss trading psychology.
So, our question is “If more than 50% of trades are profitable, why are we making money in just 10-20% trades?” A possible reason is trading psychology. We are trying hard to build a trading system but somewhere we failed to implement that system.
Many times, we make decisions based on our emotions. If a trade goes wrong, we stop following our stop-loss rules. If another trade hits our targets, we keep holding that due to our greed and expect this trade will cover all our losses. The result we both know.
Now, what to do to overcome this situation? One thing you should keep in mind is that there is no other alternative or any shortcut. Trading is a serious business and You must follow your trading setup.
No one can teach you how to follow your system. It’s you and the only you who has to develop this habit to stick with your system. You have to tell your mind that the decision you are taking based on the emotions, could be your worst decision.
The best solution that worked for me to deal with this situation is, “Whenever I find that my emotions are involved in any trade, I come out from that trade and close the terminal for some time.” Believe me, if you follow this exercise, you will find yourself in a better situation.
Successful trading is all about how you manage your emotions and behave during the trade. If you manage to keep yourself calm, you can make better decisions.
I too learn and follow the same method to keep myself away from any decisions which come through emotions. Options strategies are helping a lot to keep me calm and stable in any good or bad situation Because I know how much max I can lose and how will I manage my position to convert that loss into profit.
- If you want to lean these Non- Directional Limited Risk Options Hedging Strategies, Click Here
Nifty weekly analysis with options strategies
We have seen a good upside movement from the last one month in Nifty and there is no sign of weakness. Right now, trading near to its crucial resistance zone i.e. 18150 – 18300. A sustainable breakout will open a new upside target of 18680 based on Fibonacci Extension tool.
Nifty Midcap has given a fresh breakout and that’s a good sign for further upside rally in Nifty. Although IndiaVIX is trading near 11 and indicates low volatility in the market but as I said earlier there is no sign of weakness and the trend looks completely bullish.
If you look at the chart, you will find that 18243 is acting as resistance here. A sustainable breakout is required to generate a fresh buy signal here. On the downside, 17700 is acting as an immediate support level. Downside levels only a sustainable breakdown from this level.
For the coming weeks until nifty is not giving a fresh breakout from 18300, You may trade with range-bound strategies while keeping 17700 – 18300 as weekly range.
I suggest you do not hold or initiate any short trade till Nifty is not giving as reversal signal. Nowadays we can see lots of news about recession, but I believe, when recession would come no-one can predict. So instead of predicting anything just follow the market and chart. When you see a reversal signal on chart, you can react based on that. Yes. one thing you should always do, “keep your positions hedged”. Because we are dealing in a market where a small news can have a big impact. So always keep your risk limited.
Nifty weekly Options Chain analysis
Based on option chain data, Resistance zone is at 18300 – 18400 having PCR below 0.60. And support zone is at 18000 – 17900 having PCR above 2.
- To find support/resistance through PCR data, read full article here: How to find support and resistance with PCR?
Equally, important indicator Option Pain is at 18200, indicating weekly expiry at 14800. A shift in option pain will provide further levels of expiry. So keep tracking max pain.
Significant open interest buildup on both the side, which indicates that the market is facing support from both the side.
Keep tracking open interest to analyze market participant’s behavior. If you don’t know how to analyze open interest for weekly option hedging strategies. Just enroll for our Option Strategies – A Mentorship Program.
Nifty weekly Options Strategy: Iron Condor
Initially, you can keep a stop loss of 18000 & 18400 for this strategy. Means square off if you find nifty is giving a breakout or breakdown. Or you can do below adjustment too.
- If you find that Nifty is giving a breakdown and sustaining below 18000, then square off call spread and bring it down to 300 points lower levels.
- The same thing you could do with put spread means if you got a breakout from 18400. You can shift your put spread to 300 points up.
We will do some more adjustments to make it low loss or no-loss strategy to reduce the risk and increase profitability. You can join our premium telegram channel to know these adjustments.
If you want to learn these strategies and their adjustments in more practical ways with live mentorship, You can enrol in our Option Strategies – A Mentorship Program.
BankNifty Weekly Analysis with options strategies
Same as Nifty we have seen good upside rally in BankNifty also and it totally outperformed Nifty which is good sign for bulls. Now BankNifty is trading in all time zone so triggering a caution button here.
We need a sustainable breakout from 44200 for a fresh buy signal. Right now, trading is near to an all-time high so we may see some profit booking from here. If you are holding a long trade in BankNifty either You should reduce your quantities or hedge your position to lock profit and minimize loss.
As per my analysis I will go long only after a sustainable breakout from 44543, which is the 0.50% extension level based on Fibonacci Extension tool.
On the downside, 43144 is acting as immediate support and 41412 is the strong support level and a short trade will trigger only after a sustainable breakdown from 41412.
Nowadays, IV is also on the lower side that gives lesser premium compare to high IV but still you can create high risk; reward strategies while keeping your range little narrow based on standard deviation. You can check few examples for these limited risk range-bound option strategies here.
When you are trading with limited risk, your chances are high to make good and lose less which is the key to success in this market.
Bank Nifty Weekly options chain analysis
Based on option chain data, the highest Open interest on OTM strikes stands at 44000 CE & 43000 PE, followed by 44500 CE & 42500 PE. PCR of all strikes is 0.76, which indicates a neutral market. PCR at 43000 stands at 3.6, which acts as an immediate support level.
The Put-call ratio at 44000 stands at 0.13, which is acting as a resistance level. Equally, important indicator Option Pain is at 43500, indicating weekly expiry at 43500. A shift in option pain will provide further levels.
Remember one thing: When IV is low, we may see wild swing in either side so track the data more closely and if you find that data is changing, adjust your positions.
If you don’t know how to analyze open interest. Just enrolled for our Option Strategies – A Mentorship Program.
Bank Nifty best Weekly Options Strategy: Iron Condor
Initially, you can keep a stop loss of 42600 & 43800 for this strategy. Means square off if you find nifty is giving a breakout or breakdown. Or you can do below adjustment too.
- If you find that BankNifty is giving a breakdown and sustaining below 42600, then square off call spread and bring it down to 800 points lower levels.
- The same thing you could do with put spread means if you got a breakout from 43800. You can shift your put spread to 800 points up.
We will make some more adjustments to make it a low loss or no-loss strategy to reduce the risk and increase profitability. You can join our premium telegram channel to get these adjustments on real-time basis.
Much Check this also:-
- Unlocking the Secrets to the Most Successful Options Strategy
- High Probability Call Ratio Spread Strategy in Hindalco
- How to Use Options to Speculate on the Market?
- High probability Reverse Jade Lizard Option Strategy in LT
Post your comments in the comment box if you have a query related to weekly analysis and options strategies. You can ask any question related to option trading in the comment box.
If you need More real-time assistance on Nifty and Bank nifty weekly analysis and options strategies Can take our premium subscription or open a trading account with us and you will get real-time assistance every month on these weekly options strategies. You can contact us on WhatsApp
*( 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 options 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.