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Harmonic Patterns

Part 2 Support and ResistanceKey Terms in Options Trading Before diving deeper, let’s understand some key terms: Strike Price: The fixed price at which you can buy/sell the asset. Premium: The price paid to buy the option. Expiry Date: The date on which the option contract expires. Lot Size: Options are traded in lots (e.g., 25 shares per lot for Nifty options). In-the-Money (ITM): When exercising the option is profitable. Out-of-the-Money (OTM): When exercising would cause a loss. At-the-Money (ATM): When the strike price = current market price. Option Buyer: Pays premium, has limited risk but unlimited profit potential. Option Seller (Writer): Receives premium, has limited profit but unlimited risk. Types of Options – Calls and Puts Call Option (CE) Buyer has the right to buy. Profits when the price goes up. Put Option (PE) Buyer has the right to sell. Profits when the price goes down. Example with Reliance stock (₹2500): Call Option @ 2600: Profitable if Reliance goes above ₹2600. Put Option @ 2400: Profitable if Reliance goes below ₹2400.
NSE:KOTAKBANKEducation
by SkyTradingZone
5
Part 1 Support and ResistanceIntroduction to Options Trading Trading in the stock market has many forms: buying shares, trading futures, investing in mutual funds, or speculating in commodities. Among all these, Options Trading is one of the most exciting and complex areas. Options trading gives traders the right, but not the obligation, to buy or sell an underlying asset (like a stock, index, or commodity) at a fixed price before a fixed date. In simple words: If you buy a Call Option, you are betting that the price will go up. If you buy a Put Option, you are betting that the price will go down. Options give flexibility—traders can profit from rising, falling, or even sideways markets if they use the right strategies. That’s why they are called derivative instruments (their value is derived from an underlying asset). What are Options? (Basics) An Option is a financial contract between two parties: Buyer (Holder): Pays a premium for the right (not obligation) to buy/sell. Seller (Writer): Receives the premium and has an obligation to honor the contract. There are two basic types: Call Option (CE) – Right to buy. Put Option (PE) – Right to sell. Example: Suppose Infosys stock is trading at ₹1500. You buy a Call Option with a strike price of ₹1550 expiring in 1 month. If Infosys goes above ₹1550, you can exercise your right to buy at ₹1550 (cheaper than market). If it doesn’t, you just lose the small premium you paid. This flexibility is the beauty of options.
NSE:BANKNIFTYEducation
by SkyTradingZone
5
USDJPY MULTI TIME FRAME ANALYSISHello traders , here is the full multi time frame analysis for this pair, let me know in the comment section below if you have any questions , the entry will be taken only if all rules of the strategies will be satisfied. wait for more price action to develop before taking any position. I suggest you keep this pair on your watchlist and see if the rules of your strategy are satisfied. 🧠💡 Share your unique analysis, thoughts, and ideas in the comments section below. I'm excited to hear your perspective on this pair . 💭🔍 Don't hesitate to comment if you have any questions or queries regarding this analysis.
Short
by okako_trading
1
Nifty 1 September 2025The **Nifty 50** is one of the most important stock market indices in India, representing the performance of the top 50 large-cap companies listed on the National Stock Exchange (NSE). Introduced in 1996 by NSE, it serves as a benchmark index that reflects the overall health and direction of the Indian equity market. These 50 companies are carefully selected from various sectors such as banking, information technology, energy, pharmaceuticals, consumer goods, and automobiles, thereby providing a diversified view of the economy. The index is calculated using the free-float market capitalization-weighted method, which ensures that only the shares available for trading in the market are considered. Investors, traders, mutual funds, and foreign institutional investors closely track the Nifty 50 as it acts as a barometer for market sentiment and investment decisions. It is widely used for benchmarking portfolio performance, creating index funds, and derivative trading like futures and options. The index reflects not only the strength of leading companies but also the broader growth potential of the Indian economy. By capturing around 65% of the NSE’s total market capitalization, the Nifty 50 plays a vital role in guiding both domestic and global investors about India’s financial markets.
NSE:NIFTYShort
by TheGoldenFarmsofEquity
Part 4 Learn Institutional TradingBasics of Options (Calls & Puts) There are two main types of options: Call Option: Gives the holder the right to buy the underlying asset at a fixed price (called the strike price) before or on the expiry date. Example: You buy a Reliance call option with a strike price of ₹2500. If Reliance rises to ₹2700, you can buy at ₹2500 and gain from the difference. Put Option: Gives the holder the right to sell the underlying asset at the strike price before expiry. Example: You buy a Nifty put option with a strike price of 22,000. If Nifty falls to 21,500, your put gains in value since you can sell higher (22,000) while the market trades lower. In simple terms: Calls = Right to Buy Puts = Right to Sell How Options Work (Premiums, Strike Price, Expiry, Moneyness) Every option has certain key components: Premium: The price you pay to buy the option. This is determined by demand, supply, volatility, and time to expiry. Strike Price: The fixed price at which the option holder can buy/sell the asset. Expiry Date: Options are valid only for a certain period. In India, index options have weekly and monthly expiries, while stock options usually expire monthly. Moneyness: This defines whether an option has intrinsic value. In the Money (ITM): Already profitable if exercised. At the Money (ATM): Strike price equals the current market price. Out of the Money (OTM): Not profitable if exercised immediately.
TVC:GOLDEducation
by SkyTradingZone
10
Part 3 Learn Institutional TradingGlobal Options Markets Globally, options trading is massive: CBOE (Chicago Board Options Exchange): World’s largest options exchange. Europe & Asia: Active index and currency options markets. US Markets: Stock options are highly liquid, with advanced strategies widely used. Technology, Algo & AI in Options Modern option trading heavily depends on: Algorithmic Trading: Automated systems for fast execution. AI Models: Predicting volatility & price patterns. Risk Management Software: Real-time monitoring of Greeks. Conclusion (Tips for Traders) Options trading is exciting but requires discipline. Beginners should: Start with buying calls/puts before attempting writing. Learn about Greeks, volatility, and time decay. Always use risk management—stop losses & hedges. Avoid over-leverage. Practice strategies on paper trading before using real money. In short, options are a double-edged sword—powerful for hedging and profit-making, but risky without knowledge. With patience, discipline, and continuous learning, traders can use options effectively in any market condition.
NSE:BANKNIFTYEducation
by SkyTradingZone
9
Part 2 Ride The Big MovesRisks & Rewards in Options Trading Unlike stock trading, options have asymmetric risk-reward structures: Option Buyers: Risk limited to premium paid, but potential profit can be unlimited (for calls) or large (for puts). Option Sellers (Writers): Profit limited to premium received, but risk can be very high if the market moves sharply. Hence, option writing is generally done by professional traders with high capital and hedging systems. Option Trading in India In India, options trading is regulated by SEBI and conducted on exchanges like NSE and BSE. Lot Sizes: Options are traded in lots (e.g., Nifty = 50 units, Bank Nifty = 15 units). Margins: Sellers must deposit margin with brokers to cover risk. Expiry Cycle: Weekly (indices) and monthly (stocks). Liquidity: Index options are most liquid (Nifty & Bank Nifty).
NSE:TATASTEELEducation
by SkyTradingZone
7
Part 1 Ride The Big MovesTypes of Options Options exist across asset classes: Equity Options: Stocks like Reliance, TCS, Infosys. Index Options: Nifty, Bank Nifty, Sensex. Currency Options: USD/INR, EUR/INR. Commodity Options: Gold, Crude oil, Agricultural products. Option Trading Strategies Options are versatile because traders can combine calls and puts for different outcomes. Basic Strategies Covered Call: Holding a stock and selling a call option for income. Protective Put: Buying a put to protect stock holdings from downside. Intermediate Strategies Straddle: Buying both call & put at same strike → profits from volatility. Strangle: Buying call & put at different strikes → cheaper than straddle. Advanced Strategies Butterfly Spread: Limited risk, limited reward strategy for range-bound markets. Iron Condor: Selling both OTM calls & puts → income in stable markets. Calendar Spread: Using different expiries to capture time decay.
BSE:SENSEXEducation
by SkyTradingZone
7
PCR Trading StrategiesIntroduction to Options Trading The world of financial markets is vast, offering different ways to invest, trade, and manage risks. Among these instruments, Options have gained immense popularity because they offer flexibility, leverage, and unique strategies that regular stock trading cannot provide. Options trading is not new—it has been around for decades in global markets—but in recent years, with the rise of online platforms and growing financial literacy, even retail traders are actively participating in it. At its core, an option is a financial contract that gives the buyer the right, but not the obligation, to buy or sell an underlying asset (like a stock, index, currency, or commodity) at a predetermined price, within a certain period. This ability to choose—without compulsion—is what makes options unique compared to other financial products. Basics of Options (Calls & Puts) There are two main types of options: Call Option: Gives the holder the right to buy the underlying asset at a fixed price (called the strike price) before or on the expiry date. Example: You buy a Reliance call option with a strike price of ₹2500. If Reliance rises to ₹2700, you can buy at ₹2500 and gain from the difference. Put Option: Gives the holder the right to sell the underlying asset at the strike price before expiry. Example: You buy a Nifty put option with a strike price of 22,000. If Nifty falls to 21,500, your put gains in value since you can sell higher (22,000) while the market trades lower. In simple terms: Calls = Right to Buy Puts = Right to Sell
BITSTAMP:BTCUSDEducation
by SkyTradingZone
10
Part 1 Trading Master ClassReal-World Applications of Options Hedging Institutions hedge portfolios using index options. For example, buying Nifty puts to protect against market crash. Income Generation Funds sell covered calls or iron condors to earn steady income. Event-Based Trading Earnings announcements, policy changes, and global events cause volatility—ideal for straddles or strangles. Speculation with Leverage Traders use calls/puts for leveraged bets on short-term moves. Pros and Cons of Options Trading Pros Flexibility in strategy. Limited risk (for buyers). High leverage. Ability to profit in all market conditions. Cons Complexity. Time decay erodes value of options. Volatility risk. Unlimited risk (for sellers).
BITSTAMP:BTCUSDEducation
by SkyTradingZone
5
Option Trading Advanced Options Strategies Professional traders use combinations for specific market conditions. Butterfly Spread Outlook: Neutral, low volatility. How it works: Combination of bull and bear spreads with three strikes. Risk/Reward: Limited both ways. Calendar Spread Outlook: Neutral with time decay advantage. How it works: Sell near-term option, buy longer-term option (same strike). Benefit: Profit from faster time decay of short option. Ratio Spread Outlook: Directional but with twist. How it works: Buy one option and sell more options of the same type. Risk: Potentially unlimited. Reward: Limited to premium collected. Collar Strategy Outlook: Hedge with limited upside. How it works: Own stock, buy protective put, sell covered call. Use: Lock in gains, reduce downside. Risk Management in Options Trading Options carry significant risks if misused. Successful traders emphasize: Position Sizing: Never risk too much on one trade. Diversification: Spread across multiple strategies/assets. Stop-Loss & Adjustments: Exit losing trades early. Implied Volatility (IV) Awareness: High IV increases premiums; selling strategies may be better.
BSE:SENSEXEducation
by SkyTradingZone
5
Divergence SectersIntermediate Options Strategies These involve combining calls and puts to create structured payoffs. Bull Call Spread Outlook: Moderately bullish. How it works: Buy a call (lower strike), sell another call (higher strike). Risk: Limited to net premium. Reward: Limited to strike difference minus premium. Example: Buy ₹100 call at ₹5, sell ₹110 call at ₹2. Net cost ₹3. Max profit = ₹7. Bear Put Spread Outlook: Moderately bearish. How it works: Buy a put (higher strike), sell another put (lower strike). Risk: Limited to net premium. Reward: Limited. Iron Condor Outlook: Neutral, low volatility. How it works: Sell OTM call and put, buy further OTM call and put. Risk: Limited. Reward: Premium collected. Best for: Range-bound markets. Straddle Outlook: Expect big move (up or down). How it works: Buy one call and one put at same strike/expiry. Risk: High premium cost. Reward: Unlimited if strong move. Strangle Outlook: Expect volatility but uncertain direction. How it works: Buy OTM call + OTM put. Risk: Lower premium than straddle. Reward: Unlimited if strong price move.
NSE:NIFTYEducation
by SkyTradingZone
2
Part 1 Support and ResistanceIntroduction Options trading is one of the most fascinating and versatile aspects of the financial markets. Unlike stocks, which give ownership in a company, or bonds, which provide fixed income, options are derivative instruments whose value is derived from an underlying asset such as stocks, indices, commodities, or currencies. They give traders the right, but not the obligation, to buy or sell the underlying asset at a predetermined price before a specific expiration date. Because of this unique characteristic, options allow traders and investors to design strategies that suit a wide range of market conditions—whether bullish, bearish, or neutral. Through careful strategy selection, one can aim for limited risk with unlimited upside, hedge existing positions, or even profit from sideways markets where prices don’t move much. This article explores options trading strategies in detail. We’ll cover the building blocks of options, common strategies, advanced combinations, and risk management. By the end, you’ll have a strong foundation to understand how professional traders use options to manage portfolios and generate returns. 1. Basics of Options Before diving into strategies, it’s important to review some fundamental concepts. 1.1 What is an Option? Call Option: Gives the holder the right (not obligation) to buy the underlying asset at a predetermined price (strike price) before or on expiration. Put Option: Gives the holder the right (not obligation) to sell the underlying asset at a predetermined price before or on expiration. 1.2 Key Terms Premium: The price paid to buy an option. Strike Price: The agreed price to buy or sell the underlying. Expiration Date: The last day the option can be exercised. Intrinsic Value: Difference between underlying price and strike (if favorable). Time Value: Portion of the premium that reflects time until expiration. 1.3 Options Styles European Options: Exercisable only at expiration. American Options: Exercisable any time before expiration.
NSE:TATASTEELEducation
by SkyTradingZone
3
Trading Master Class With ExpertsReal-Life Applications of Options Options are not just trading tools; they have practical uses: Insurance companies use options to hedge portfolios. Exporters/Importers hedge currency risks using options. Banks use interest rate options to manage risk. Investors use protective puts to safeguard their stock portfolios. Psychology of Options Trading Trading options requires discipline. Many beginners blow up accounts because: They buy cheap OTM options hoping for jackpots. They ignore time decay. They overtrade due to low cost of entry. A successful option trader thinks like a risk manager first, profit seeker second.
MCX:GOLD1!Education
by SkyTradingZone
2
Part 4 Institutional Trading Simple Option Strategies Options allow creativity. Instead of just buying/selling, traders create strategies by combining calls & puts. a) Protective Put Buy stock + Buy Put option = Insurance against downside. b) Covered Call Own stock + Sell Call option = Earn income if stock stays flat. c) Straddle Buy Call + Buy Put (same strike, same expiry) = Profit from big moves either way. d) Strangle Buy OTM Call + OTM Put = Cheaper than straddle but requires bigger move. e) Iron Condor Sell OTM Call + OTM Put, while buying further OTM options = Profit if market stays in range. These are just a few. Professional traders use dozens of strategies depending on market condition. Risks in Options Trading Options are attractive, but risky too. Time Decay (Theta) → Every day, options lose value as expiry approaches. Wrong Direction → If your view is wrong, you lose the premium. Liquidity Risk → Some strikes may have no buyers/sellers. Over-Leverage → Small premium tempts traders to overtrade, leading to big losses.
BSE:SENSEXEducation
by SkyTradingZone
1
Part 2 Ride The Big MovesIntroduction to Options Trading When people think about the stock market, they usually think about buying and selling shares. But there’s another side of the market that’s both exciting and complex—derivatives trading. An option is one such derivative. Instead of directly buying a share, you buy a contract that gives you the right (but not the obligation) to buy or sell the share at a certain price within a certain time. Sounds interesting? Let’s make it simple with an analogy. 👉 Imagine you’re interested in buying a car priced at ₹10 lakh. But you’re not sure if you’ll have the money or if the price will change in the future. The dealer says: Pay me ₹10,000 now, and I’ll give you the right to buy the car at ₹10 lakh anytime in the next three months. If car prices rise to ₹11 lakh, you can still buy at ₹10 lakh and save ₹1 lakh. If prices fall to ₹9 lakh, you can simply let the contract expire and lose only your ₹10,000 advance. This advance is like the option premium, and the contract is your option. That’s the essence of options trading—buying rights, not obligations. Basics of Options Options are broadly of two types: Call Option (CE) → Right to buy an asset at a fixed price before expiry. Put Option (PE) → Right to sell an asset at a fixed price before expiry. Example: Call Option: You buy a Reliance 2500 CE (Call Option) at a premium of ₹50. If Reliance rises to ₹2600, you can still buy it at ₹2500 and gain ₹100 (minus premium). If Reliance falls to ₹2400, you won’t exercise it and lose only ₹50. Put Option: You buy a Reliance 2500 PE at a premium of ₹40. If Reliance falls to ₹2400, you can sell at ₹2500 (gain ₹100). If Reliance rises to ₹2600, you won’t exercise it and lose only ₹40. This is why options are considered insurance tools in markets.
NSE:BANKNIFTYEducation
by SkyTradingZone
1
PCR Trading StrategyHow Beginners Can Start Learn basics of Call, Put, Strike Price. Practice with paper trading before real money. Start with simple strategies (like Buying Calls/Puts). Avoid Option Writing (selling) initially — it’s risky. Slowly learn Greeks, volatility, strategies. Regulatory & Market Aspects (India Example) Options in India are traded on NSE & BSE. Lot sizes fixed by exchanges. Weekly & Monthly expiries available. SEBI regulates to ensure safety. Margins required especially for Option Writing. Famous Stories in Options Trading Hedging by Corporates → Big companies use options to hedge currency & commodity risks. Speculators → Many traders have made fortunes (and huge losses) in options because of leverage. Example: Traders during COVID crash used Put Options and made huge profits.
NSE:INFYEducation
by SkyTradingZone
2
Part 1 Support ans ResistancePayoff Diagrams (Understanding Profits & Losses) Options are best understood with payoff diagrams. Call Buyer → Loss limited to premium, profit unlimited. Put Buyer → Loss limited to premium, profit grows as price falls. Call Seller → Profit limited to premium, risk unlimited. Put Seller → Profit limited to premium, risk high if price falls. Common Option Strategies Beginners usually just buy Calls or Puts. But professionals use strategies combining multiple options: Covered Call → Hold stock + Sell Call to earn income. Protective Put → Hold stock + Buy Put for protection. Straddle → Buy Call + Buy Put (bet on big movement either way). Strangle → Similar to Straddle but strikes are different. Iron Condor → Sell both Call & Put spreads (profit if market stays flat).
NSE:HDFCBANKEducation
by SkyTradingZone
2
Part 4 Trading Master ClassOptions Premium – How Price is Decided? The premium (cost of option) depends on: Intrinsic Value → The real value of option (difference between current price & strike price). Time Value → More time till expiry = higher premium. Volatility → If market is volatile, premium is high because chances of big move increase. Interest Rates & Dividends → Minor effect. 👉 Example: Reliance = ₹2,600. Call Option 2,500 Strike = Intrinsic Value = ₹100. Premium charged = ₹120 (extra ₹20 is time value). Moneyness of Options Options are classified as: In the Money (ITM) → Option already has profit potential. At the Money (ATM) → Option strike = Current price. Out of the Money (OTM) → Option has no intrinsic value (only time value). 👉 Example (Stock at ₹500): Call 480 = ITM. Call 500 = ATM. Call 520 = OTM.
NSE:NIFTYEducation
by SkyTradingZone
2
Part 2 Trading Master ClassTypes of Options There are only two main types of options: (A) Call Option (Right to Buy) A call option gives the buyer the right to buy the asset at a fixed price. 👉 Example: Stock: Reliance is at ₹2,500 today. You buy a Call Option at strike price ₹2,600, paying a premium of ₹50. If Reliance goes to ₹2,700, you can buy at ₹2,600 (profit). If Reliance stays below ₹2,600, your option expires worthless, and you lose the ₹50 premium. (B) Put Option (Right to Sell) A put option gives the buyer the right to sell the asset at a fixed price. 👉 Example: Stock: Infosys is at ₹1,400. You buy a Put Option at strike ₹1,350, paying premium ₹20. If Infosys falls to ₹1,300, you can sell at ₹1,350 (profit). If Infosys stays above ₹1,350, your option expires worthless, and you lose the ₹20 premium. Why Trade Options? Options are popular because they provide flexibility, leverage, and hedging. 1. Leverage (Small money, big exposure) With just a small premium, you control a large quantity of shares. Example: To buy 50 shares of Nifty (at 20,000), you need ₹10 lakhs. But an option may cost only ₹20,000 for the same exposure. 2. Hedging (Risk Protection) Investors use options to protect portfolios. Example: If you hold Infosys shares, you can buy a Put Option to protect against price falls (like insurance). 3. Speculation (Profit from movement) Traders use options to bet on price moves (up, down, or even staying flat). 4. Income (Option Writing) Professional traders sell options to earn premiums regularly.
NSEIX:NIFTY1!Education
by SkyTradingZone
2
Part 1 Trading Master ClassIntroduction to Options Trading Imagine you want to buy a house. You like one particular property, but you don’t want to commit right away. Instead, you tell the seller: "Here’s ₹1 lakh. Keep this house reserved for me for the next 6 months. If I decide to buy, I’ll pay you the agreed price. If not, you can keep this ₹1 lakh." That ₹1 lakh you gave is called a premium. The deal you made is an option — a contract that gives you the right but not the obligation to buy the house. This is the core idea of options trading: you pay a small premium to get the right to buy or sell something (like stocks, indexes, commodities, etc.) at a fixed price in the future. What is an Option? An option is a contract between two parties: Buyer of option (the one who pays the premium). Seller of option (the one who receives the premium). The buyer has the right (but not obligation) to buy or sell at a certain price. The seller has the obligation to fulfill the deal if the buyer exercises the option. Key Terms: Underlying Asset → The thing on which the option is based (stocks like Reliance, Infosys, indexes like Nifty, commodities, etc.). Strike Price → The pre-decided price at which the buyer can buy or sell. Premium → The cost of buying the option. Expiry → The last date till which the option is valid. Lot Size → Options are traded in fixed quantities, not single shares. Example: Nifty options lot = 50 shares.
NSE:BANKNIFTYEducation
by SkyTradingZone
Part 2 Master Candlestick PatternDisadvantages of Options Complexity for beginners Time decay risk (premium can vanish) Unlimited risk for sellers of uncovered options Requires active monitoring for effective trading Tips for Successful Options Trading Understand the underlying asset thoroughly. Start with basic strategies like long calls, puts, and covered calls. Use proper risk management and position sizing. Keep track of Greeks to understand sensitivity. Avoid over-leveraging. Monitor market volatility; high volatility can inflate premiums. Use demo accounts or paper trading for practice.
NSE:KOTAKBANKEducation
by SkyTradingZone
3