Nifty: The 2-3-5 Rule works it's magic

NSE:NIFTY   Nifty 50 Index

This is not a fresh recommendation
- In our earlier post we had warned about trouble times for Nifty based on the chart set up
- we had also highlighted the possibility of Nifty breaking Support line based on the 2-3-5 Rule ( in the 5th attempt, the chances of breaking the support line is higher)

Well, 2-3-5 Rule works its magic...

As it was the 5th attempt at the support line, we went with the rule and were aggressive on the shorts.
Note Technical Analysis is one thing and trading is another. Although I was aggressive on the shorts, in the trade we had, there was still margin for being wrong

We had 18400 Call short position at 120 which was squared off earlier around 27 and shifted our call short position to 18200 Call short around 70

Along with that we had bought 17900 Put Long at 150 (this cost was taken care of and covered with the premium we had received on overall Call Short position. We had received 163 points from the Call Short position. So even if Nifty expiry would have happened at 18200 we would have still made 13 points on the overall Nifty trade )

Partial profit booking for 17900 Put was done on Friday around 254 and today we have booked full profits at 336.
CMP for the 17900 Put is 380. I could have waited and earned more but that's fine with me. I had an initial target of 330 when I entered the trade at 150 and I am more than happy to get what I have got.

18200 Call option Short sold at 70
CMP 4.

Overall a good day to begin the week with....

Enjoy & Happy trading....!!! 🙂

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