BANK NIFTY is exactly in middle of its Supports and resistances. As Bank Nifty chart shows, we have a 300 point (approx) upside and downside from current levels. So, I think, here is how one should trade it-
Case1) If it opens gap up- If BNF (Bank nifty) opens gap up, there is an upward bias and it might go up and as it reaches Resistance area, SHORT (or Buy PUT option) at any level above 31350. Put a STOP LOSS of 31520 (just above 31500, i.e.) and target could be anywhere down by 300 or 400 points.
Case 2) If it opens gap do down- If BNF opens gap down with a downward bias then it will head straight down and take refuge at around 30700 levels. As shown, there are 3 crucial supports at 30807 (on 60 min chart), 30745 (20 DEMA line), 30636 (last time's support). So buy at any level where it spends more than 15 minutes around 30750 levels. STOP LOSS should be lower than 30600 and target could be anything above 31100.
Case 3) If it BNF opens where it is (+/- 50 points), then best bet is to go STRADDLE- Buy a CALL and PUT option of same strike and put SL of 50 % on both options. Book profit at resistances or supports!
Case1) If it opens gap up- If BNF (Bank nifty) opens gap up, there is an upward bias and it might go up and as it reaches Resistance area, SHORT (or Buy PUT option) at any level above 31350. Put a STOP LOSS of 31520 (just above 31500, i.e.) and target could be anywhere down by 300 or 400 points.
Case 2) If it opens gap do down- If BNF opens gap down with a downward bias then it will head straight down and take refuge at around 30700 levels. As shown, there are 3 crucial supports at 30807 (on 60 min chart), 30745 (20 DEMA line), 30636 (last time's support). So buy at any level where it spends more than 15 minutes around 30750 levels. STOP LOSS should be lower than 30600 and target could be anything above 31100.
Case 3) If it BNF opens where it is (+/- 50 points), then best bet is to go STRADDLE- Buy a CALL and PUT option of same strike and put SL of 50 % on both options. Book profit at resistances or supports!