Nifty Options 13 Jan 2020 and trading system description
Updated
Nifty Update on request of Raunak Goswami
I would also like to shed some light on trading system , stop loss and targets.
1. If market opens above decision range , then 7/10 times it'll stay above decision range whole day. If we are shorting market we'll go short near resistance and try to cover some where inside decision range. If we are going long we wait for any pull back and go long with a stop below decision range.
2. If market opens below decision range , then 7/10 times it'll not break above decision range whole day. So shorting near decision range or going long at support for a target of decision range will be the strategy.
Stop Losses
Stop losses are very easy to manage in our system. There's only one pro tip
If you are not a very confident trader or going through streak of losses from months then if you are going short at resistance or long at support and market starts going against you for 10-15 min , you book loss.
If after say 40-50 points going against you market start reversing and starts going below resistance again , you short again and keep the recent high as stop.
Trend days or sideways days
On a trend day you should not try counter trading , like on a bull reversal day or bull up trend day , shorting is not advisable and vice versa .
How to determine whether it's trend day or sideways day
Stay with me :)
I would also like to shed some light on trading system , stop loss and targets.
1. If market opens above decision range , then 7/10 times it'll stay above decision range whole day. If we are shorting market we'll go short near resistance and try to cover some where inside decision range. If we are going long we wait for any pull back and go long with a stop below decision range.
2. If market opens below decision range , then 7/10 times it'll not break above decision range whole day. So shorting near decision range or going long at support for a target of decision range will be the strategy.
Stop Losses
Stop losses are very easy to manage in our system. There's only one pro tip
If you are not a very confident trader or going through streak of losses from months then if you are going short at resistance or long at support and market starts going against you for 10-15 min , you book loss.
If after say 40-50 points going against you market start reversing and starts going below resistance again , you short again and keep the recent high as stop.
Trend days or sideways days
On a trend day you should not try counter trading , like on a bull reversal day or bull up trend day , shorting is not advisable and vice versa .
How to determine whether it's trend day or sideways day
Stay with me :)
Note
Ok 2 points to add as requested by many. If market opens above decision range , 50-80 points in bank nifty , 15-20 points in nifty and starts to come back and trade inside decision range , it means a sharp downward momentum can develop so options can be bought when decision range breaks with a stop above high of day.
If market opens above resistance then it'll be support for the day , similarly if market opens below support it'll be day resistance
Note
Ok last comment from my side , please don't ask me for further clarification If you short at resistance and If market breaks above resistance for 15-20 min and not going below resistance , you can reverse positions and go long for extension targets. usually our direction is correct 7/10 times so we don't need to reverse positions.
What is extension target
If resistance / support of a day breaks , how far market can go is the extension target.
How to find extension target
Calculation is manual and depends on that day's volatility. Sometimes I advise my friends to book profit at a particular point and sometimes to keep positions running till 3:30 or carry for next day morning.
I can't disclose that here in public
How to determine direction accurately
It's also a manual exercise , can't disclose in public
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.