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Harmonic Patterns

Part 3 Learn Institutional Trading How Option Trading Works When a trader buys a call option, they expect the price of the underlying asset to rise above the strike price before expiration. If the price rises significantly, the trader can either exercise the option or sell it in the market for a profit. Similarly, buying a put option reflects a bearish view, where the trader expects prices to fall. Option sellers, on the other hand, earn income through the premium received. However, selling options involves higher risk, as losses can be substantial if the market moves sharply against the position.
FXOPEN:XAUUSDEducation
by SkyTradingZone
Part 1 Ride The Big MovesWhat Are Options? An option is a financial derivative contract that derives its value from an underlying asset such as a stock, index, commodity, or currency. The contract gives the buyer the right, but not the obligation, to buy or sell the underlying asset at a predetermined price, known as the strike price, on or before a specified date called the expiration date. The seller (or writer) of the option has the obligation to fulfill the contract if the buyer chooses to exercise the option. There are two main types of options: Call Options: Give the buyer the right to buy the underlying asset at the strike price. Put Options: Give the buyer the right to sell the underlying asset at the strike price. The buyer pays a price known as the premium to the seller for acquiring this right.
NSE:RELIANCEEducation
by SkyTradingZone
Candle Pattern What Are Candlestick Patterns? Candlestick patterns originate from Japanese rice traders and represent the open, high, low, and close of price. They are especially useful for identifying short-term reversals, continuations, and market indecision. Common Mistakes Traders Make Trading patterns without confirmation Ignoring higher timeframes Overtrading every pattern Forgetting risk management Ignoring market context and trend Patterns work best when aligned with: Trend direction Support & resistance Volume Broader market sentiment
NSE:TATASTEELEducation
by TechnicalExpress
Part 2 Candle Patterns Profit Potential in Buying Options a) Unlimited Upside in Call Buying Max profit can be extremely high if stock surges. b) High Return on Small Investment Low premium gives high leverage. Example: ₹5,000 investment generating ₹25,000 profit. c) Best for Momentum Trades Short-term sharp moves create strong premium expansion. d) Limited Risk Maximum loss = premium paid. This helps manage losses clearly. e) News-Based Profit Opportunity Earnings announcements Budget events Interest rate decisions
TVC:DXYEducation
by SkyTradingZone
Part 2 Support and Resistance Buying Options for Profit Buying options is attractive because: limited risk (only premium) unlimited profit potential (for calls) high reward-to-risk ratio lower capital requirement vs buying stocks Example of buying a call: Premium paid: ₹20 Strike: ₹100 Spot moves to ₹130 Intrinsic value: 130 − 100 = ₹30 Profit = ₹30 − ₹20 = ₹10 per share If each lot has 500 shares: Total profit = ₹5,000 The beauty: Maximum risk = ₹20 × 500 = ₹10,000 Even if the asset crashes, your loss is capped.
NSE:DIXONEducation
by SkyTradingZone
Part 1 Support and Resistance How Option Trading Profits Work There are two major types of option contracts: Call Options: Profit when asset prices rise. Put Options: Profit when asset prices fall. When you buy an option, you pay a premium. This premium is the cost of entering the trade. When the market moves in your favor, the value of the option increases, enabling you to sell it for more than you paid, or exercise it at a favorable price. The core idea: If the market moves toward your expectation, you profit. If the market moves against your expectation, you lose only the premium if you're a buyer. Profit = (Option Selling Price – Option Purchase Price) – Premium
NSE:M&MEducation
by SkyTradingZone
Part 7 Trading Master Class Buyers vs Sellers in Option Trading Option trading has two sides: buyers and sellers (writers). Option Buyer Pays a premium Risk is limited to the premium paid Profit potential can be unlimited (for calls) Needs strong price movement in the expected direction Option Seller Receives the premium Profit is limited to the premium received Risk can be unlimited (especially in naked positions) Benefits from time decay and sideways markets This buyer-seller dynamic makes options a zero-sum game, where one side’s gain is the other’s loss.
FXOPEN:XAUUSDEducation
by SkyTradingZone
Candle Patterns The Power of Context: Where Patterns Truly Work Patterns are not standalone signals. Their effectiveness depends on context: Trend Direction: Patterns aligned with the higher-timeframe trend have higher probability. Support and Resistance: Patterns near key levels carry more weight. Volume: Breakouts with volume confirm participation. Market Structure: Higher highs and higher lows validate bullish patterns; lower highs and lower lows validate bearish ones. A bullish engulfing in the middle of nowhere is noise. The same pattern at a weekly support level is opportunity.
NSE:BHARTIARTLEducation
by TechnicalExpress
Chart Patterns Financial markets speak a language of price. Every movement on a chart represents the collective psychology of millions of participants—institutions, traders, investors, algorithms, and speculators. Chart patterns and candlestick patterns are the visual translation of this psychology. They do not predict the future with certainty, but they provide probabilistic insights into market behavior, trend continuation, reversals, and momentum shifts. Mastering them allows traders to read price action with clarity, discipline, and confidence.
NSE:INFYEducation
by TechnicalExpress
Option Trading Strategies Directional Option Trading Strategies Directional strategies are used when the trader has a clear bullish or bearish view on the underlying asset. Long Call Strategy (Bullish) Concept: Buy a call option expecting the price to rise. Maximum Loss: Premium paid Maximum Profit: Unlimited Best Market Condition: Strong uptrend Use Case: When you expect sharp upside movement with high momentum. Risk: If price does not move fast enough, time decay erodes option value.
MCX:GOLD1!Education
by SkyTradingZone