Nifty Alert: Chart set up and trading strategy
Nifty
(in case the chart notes are overlapping, feel free to expand the chart as per convenience)
- the red line (Laxman Rekha suggested in month of Feb 2021) has again provided support today...
- a 3 day sustainable break of yellow turned dashed red line would increase the probability of breaking the Laxman Rekha for further down move
Coming to the 50 day EMA and 200 day EMA
- we observe 50 day EMA crossover above the 200 day EMA on 07 Aug 2020
- retest of 200 day EMA on 24 Sep 2020
- thereafter Nifty has been taking support at 50 day EMA and bouncing back
- we also observe the bounceback getting weaker after every retest of 50 day EMA
- at the 4th attempt Nifty is going sideways now....
The set up suggests the underlying is getting weaker and there is a strong probability of Nifty moving lower towards 200 day EMA in the next 2-3 months (Target level highlighted in the chart)
- pattern gets invalidated if Nifty closes above the resistance zone highlighted in the chart
Trading strategy
Given the set up
On any rise in Nifty levels, One may consider selling Nifty 27-May-2021 expiry 15200 Call option in the range of 250-300
The strategy gives a return potential of 14-16% over the next 50 odd days.
More importantly it covers risk for a rise in Nifty level up to 15500 till 27 May 2021 giving us ample scope to adjust / exit in case Nifty moves in the direction of SL.
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
(in case the chart notes are overlapping, feel free to expand the chart as per convenience)
- the red line (Laxman Rekha suggested in month of Feb 2021) has again provided support today...
- a 3 day sustainable break of yellow turned dashed red line would increase the probability of breaking the Laxman Rekha for further down move
Coming to the 50 day EMA and 200 day EMA
- we observe 50 day EMA crossover above the 200 day EMA on 07 Aug 2020
- retest of 200 day EMA on 24 Sep 2020
- thereafter Nifty has been taking support at 50 day EMA and bouncing back
- we also observe the bounceback getting weaker after every retest of 50 day EMA
- at the 4th attempt Nifty is going sideways now....
The set up suggests the underlying is getting weaker and there is a strong probability of Nifty moving lower towards 200 day EMA in the next 2-3 months (Target level highlighted in the chart)
- pattern gets invalidated if Nifty closes above the resistance zone highlighted in the chart
Trading strategy
Given the set up
On any rise in Nifty levels, One may consider selling Nifty 27-May-2021 expiry 15200 Call option in the range of 250-300
The strategy gives a return potential of 14-16% over the next 50 odd days.
More importantly it covers risk for a rise in Nifty level up to 15500 till 27 May 2021 giving us ample scope to adjust / exit in case Nifty moves in the direction of SL.
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
Trade active:
As suggested we have a rise in Nifty today
Nifty 27 May expiry
15200 Call option has made a high of 282.85 so far
Currently around 274
Right in the middle of the range suggested above.
Nifty 27 May expiry
15200 Call option has made a high of 282.85 so far
Currently around 274
Right in the middle of the range suggested above.
Trade active:
Nifty CMP 14360
Strategy update:
Nifty 27 May expiry
15200 Call option update
CMP 104
Profit of 170 points (Rs 12750/-) so far per lot
Enjoy &
Happy trading...!!! 😊
Strategy update:
Nifty 27 May expiry
15200 Call option update
CMP 104
Profit of 170 points (Rs 12750/-) so far per lot
Enjoy &
Happy trading...!!! 😊
