As a result of yesterday's relatively hawkish statements by Powell during the Fed Meet - Banknifty has opened in negative territory right off the bat. Personally I feel bears will dominate the day but owing to the broader market being close to key support levels - I have to assume a neutral stance for now. But does my stance matter? Not at all - because me and my community members trade the price and the system and not expectations.
Speaking about the system:
In this chart we've marked 2 price levels which have been determined based on previous day high ( PDH ) and previous day low ( PDL ) of Banknifty . The zone between these two price levels is a strict "No Trade Zone".
If Banknifty crosses/opens or stays above the PDH , we will be looking for long opportunities and if Banknifty crosses/opens or stays below the PDL , we will be looking for short opportunities.
Entry criteria:
Bullish case: Breakout to be followed by retracement which in turn would be followed by a 5 minute candle close above the DAY HIGH.
Bearish case: Breakout to be followed by retracement which in turn would be followed by a 5 minute candle close below the DAY LOW.
Stop Loss criteria:
Ideally the stop loss should be palced just below (in bullish case) or just above (in bearish ) the nearest retracement on the spot chart; this is a just a guide though - in some cases you might actually have to deploy your own discretion. Assuming you're trading at-the-money (ATM) options - the stop loss wouldbe half the stop loss on the spot chart of Banknifty .
Take profit criteria:
ATM Option Buying (Next Week Expiry): Enter with 2 lots. Exit lot number 1 at 1:1 RR. Once 1:1 RR is hit, set Stop Loss of lot 2 to cost and take profit of the same at 1:3 RR.
ATM Option Selling (Current Week Expiry): Enter with 2 lots. Exit lot number 1 at 1:1 RR. Once 1:1 RR is hit, trail profit in lot 2 with the help of 15 EMA on the option chart; exit lot 2 on 5 minute candle close above 15 EMA .
Please note the given zones are valid only until the end of the day. Any open positions must be closed by 15:20 PM IST.
Speaking about the system:
In this chart we've marked 2 price levels which have been determined based on previous day high ( PDH ) and previous day low ( PDL ) of Banknifty . The zone between these two price levels is a strict "No Trade Zone".
If Banknifty crosses/opens or stays above the PDH , we will be looking for long opportunities and if Banknifty crosses/opens or stays below the PDL , we will be looking for short opportunities.
Entry criteria:
Bullish case: Breakout to be followed by retracement which in turn would be followed by a 5 minute candle close above the DAY HIGH.
Bearish case: Breakout to be followed by retracement which in turn would be followed by a 5 minute candle close below the DAY LOW.
Stop Loss criteria:
Ideally the stop loss should be palced just below (in bullish case) or just above (in bearish ) the nearest retracement on the spot chart; this is a just a guide though - in some cases you might actually have to deploy your own discretion. Assuming you're trading at-the-money (ATM) options - the stop loss wouldbe half the stop loss on the spot chart of Banknifty .
Take profit criteria:
ATM Option Buying (Next Week Expiry): Enter with 2 lots. Exit lot number 1 at 1:1 RR. Once 1:1 RR is hit, set Stop Loss of lot 2 to cost and take profit of the same at 1:3 RR.
ATM Option Selling (Current Week Expiry): Enter with 2 lots. Exit lot number 1 at 1:1 RR. Once 1:1 RR is hit, trail profit in lot 2 with the help of 15 EMA on the option chart; exit lot 2 on 5 minute candle close above 15 EMA .
Please note the given zones are valid only until the end of the day. Any open positions must be closed by 15:20 PM IST.
Order cancelled:
It's now too late in the day for a new position to be opened.