#Banknifty Trading Plan for 28 Jan 2022
Updated
Today's I'm bullish on Banknifty. Expecting a really good move ahead which should be caught by my system; here's what it looks like.
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. Given that it is has given a gap-up opening above PDH - for now I am looking only for long 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. Since the market has already opened with a gap now I will only be looking for a retracement followed by Day High Breakout.
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.
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. Given that it is has given a gap-up opening above PDH - for now I am looking only for long 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. Since the market has already opened with a gap now I will only be looking for a retracement followed by Day High Breakout.
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.
Note
Banknifty seems to be giving an action-replay from yesterday. The direction of the possible upcoming breakout though is not clear yet.If a breakdown occurs - it is possible that my trade parameters might not be met right off the bat. So, if you are a discretionary trader and/or can afford some extra risk you may also trade a Day Low breakdown if and when it is witnessed.
Note
Banknifty continues to trade within a very tight range. One can possibly expect momentum in the second half.Order cancelled
It's too late in the day now and CMP is way too far from the trigger on either side.
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