Nifty: Possible Head and shoulders in the making
Nifty
Till the time Nifty trades below 17840 odd levels there is a strong possibility of nifty forming Head and Shoulders
The target for the current set up could be roughly 16930 odd levels.
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Given the setup one may consider selling 28 Oct expiry
18200 Call option & buy
18500 Call option
The strategy would give roughly 50 points per lot and since the position is hedged margin requirement would get reduced and give us a yield potential of 8% approximately per strategy lot.
The strategy also has an inbuilt loss protection for a rise up to 18250 till 28 Oct expiry
That gives us enough scope to be wrong considering the fact that pattern gets invalidated above 17840 odd levels
Take care & safe trading
Disclaimer
- The view expressed here is my personal view
- Past performance is not a guarantee for future predictions
- Use this for educational purpose
- Any decision you take, you need to take responsibility for the same
- It's your hard earned money. Treat it wisely
- Trade / Invest keeping in mind your trading style, goals and objectives, time horizon & risk tolerance
- if trading in F&O, understand that F&O trading involves risk
- Do take proper risk management measures
- Do your own analysis and consult your financial adviser if need be
Till the time Nifty trades below 17840 odd levels there is a strong possibility of nifty forming Head and Shoulders
The target for the current set up could be roughly 16930 odd levels.
_______________________________________________________________________________________________________
Given the setup one may consider selling 28 Oct expiry
18200 Call option & buy
18500 Call option
The strategy would give roughly 50 points per lot and since the position is hedged margin requirement would get reduced and give us a yield potential of 8% approximately per strategy lot.
The strategy also has an inbuilt loss protection for a rise up to 18250 till 28 Oct expiry
That gives us enough scope to be wrong considering the fact that pattern gets invalidated above 17840 odd levels
Take care & safe trading
Disclaimer
- The view expressed here is my personal view
- Past performance is not a guarantee for future predictions
- Use this for educational purpose
- Any decision you take, you need to take responsibility for the same
- It's your hard earned money. Treat it wisely
- Trade / Invest keeping in mind your trading style, goals and objectives, time horizon & risk tolerance
- if trading in F&O, understand that F&O trading involves risk
- Do take proper risk management measures
- Do your own analysis and consult your financial adviser if need be
We see Selling pressure in Nifty increase exactly from the red zone identified before hand...
That's the power of Technical Analysis... It may not give you wings but it can give you vision...
Strategy update:
We had anticipated a move up to 17820-17840 odd levels. Our strategy factored in that kind of movement.
Despite Nifty being 190 points up at one particular time in the day (from the level the trade was initiated) max loss in strategy was 17 points per lot keeping us very much in control of the situation.
Manage your risk to stay profitable
Take care & safe trading...!!!