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Part 2 Candle Stick PatternParticipants in Options Trading Options markets consist of four main participants: Buyers of Calls – Expect the underlying asset’s price to rise. Risk limited to premium. Buyers of Puts – Expect the underlying asset’s price to fall. Risk limited to premium. Sellers (Writers) of Calls – Expect prices to remain below the strike price. Risk is theoretically unlimited for naked calls. Sellers (Writers) of Puts – Expect prices to remain above the strike price. Risk is substantial if the asset falls sharply. Options Strategies Option trading is highly versatile. Traders can employ strategies ranging from conservative hedging to speculative bets: Covered Call: Holding the underlying asset while selling call options to generate income from premiums. Protective Put: Buying puts while holding the asset to protect against downside risk. Straddle: Buying a call and a put with the same strike price and expiration, expecting high volatility. Strangle: Buying out-of-the-money call and put options for lower cost but with a wider price movement range. Spreads: Combining multiple options to limit risk and potential profit (e.g., bull call spread, bear put spread). Option Pricing Factors Option prices are influenced by several variables: Underlying Asset Price: Higher asset prices increase call values and decrease put values. Strike Price: The proximity of the strike to the current asset price affects intrinsic value. Time to Expiration: More time increases time value and option price. Volatility: Greater market volatility increases the likelihood of significant price changes, raising premiums. Interest Rates & Dividends: Rising interest rates increase call values and reduce put values; dividend payouts impact stock options. The most widely used pricing model is the Black-Scholes Model, which calculates theoretical option prices based on these factors. Advantages of Option Trading Leverage: Control a larger position with a smaller capital outlay. Hedging: Protect portfolios against adverse price movements. Flexibility: Execute a wide range of strategies for bullish, bearish, or neutral markets. Defined Risk: Maximum loss for buyers is limited to the premium paid. Profit in Any Market: Options allow for profit in rising, falling, or sideways markets. Risks of Option Trading Options are complex and involve risks: Premium Loss: Buyers can lose the entire premium if the option expires worthless. Leverage Risk: While leverage amplifies gains, it also amplifies losses for sellers or advanced strategies. Time Decay (Theta): Options lose value as expiration nears if the underlying price does not move favorably. Volatility Risk (Vega): Changes in market volatility affect option prices. Complexity: Advanced strategies can involve multiple positions and require careful monitoring.
BITSTAMP:BTCUSDEducation
by SkyTradingZone
6
Part 1 Candle Stick Pattern Understanding Option Trading Option trading is a segment of financial markets that allows investors to buy or sell the right to buy or sell an underlying asset at a predetermined price within a specific time frame. Unlike traditional stock trading, options provide leverage, flexibility, and risk management tools, making them appealing for both hedging and speculative purposes. Options are derivatives, meaning their value is derived from an underlying asset, such as stocks, indices, commodities, or currencies. An option does not grant ownership of the asset itself but gives the holder the right to engage in a transaction involving the asset. Types of Options Options are broadly categorized into two types: Call Options A call option gives the buyer the right (but not the obligation) to buy the underlying asset at a specified price, called the strike price, before or on the expiration date. Buyers of call options generally expect the underlying asset’s price to rise, allowing them to purchase the asset at a lower price than the market value. Sellers (writers) of call options receive the option premium upfront but take on the obligation to sell the asset if the buyer exercises the option. Put Options A put option gives the buyer the right (but not the obligation) to sell the underlying asset at the strike price before or on the expiration date. Buyers of put options generally expect the underlying asset’s price to fall, allowing them to sell the asset at a higher price than the market value. Sellers of put options receive the premium but face the obligation to buy the asset if exercised. Key Components of Options To understand option trading, one must know the following components: Underlying Asset – The security or asset on which the option is based (e.g., a stock like Apple or an index like Nifty 50). Strike Price (Exercise Price) – The predetermined price at which the option can be exercised. Expiration Date – The date on which the option expires. After this date, the option becomes worthless. Premium – The price paid by the buyer to the seller for the rights conferred by the option. Intrinsic Value – The difference between the underlying asset’s current price and the strike price, representing the real, immediate value of the option. Time Value – The portion of the premium that reflects the possibility of the option gaining value before expiration. Time decay reduces this value as the expiration date approaches. How Options Work Let’s illustrate with an example: Suppose a stock is trading at ₹1,000, and you buy a call option with a strike price of ₹1,050, expiring in one month, paying a premium of ₹20. If the stock rises to ₹1,100 before expiration, you can exercise the option to buy at ₹1,050, making a profit of ₹50 per share minus the premium, i.e., ₹30 per share. If the stock stays below ₹1,050, you would not exercise the option, losing only the premium of ₹20. This example highlights two key advantages of options: Leverage: You control more assets with less capital compared to buying the stock outright. Limited Risk: The maximum loss for the buyer is the premium paid, unlike stock trading where losses can be higher.
MCX:GOLD1!Education
by SkyTradingZone
6
NIFTY 1D Time frame📊 Today’s Nifty Performance Opening: Around 25,109 Closing: Around 25,057 Result: Market slipped about –52 points (–0.45%) Range: High near 25,150, Low near 25,027 👉 If you were long (buy side) from the open and held till close → small loss (~52 points). 👉 If you were short (sell side) from the open and held till close → small profit (~52 points). 🎯 Key Levels Support Zone: 25,000 – 25,020 Resistance Zone: 25,130 – 25,150 📝 Strategy For Intraday Traders Sell near resistance (25,130–25,150) with stop-loss just above 25,160. Buy near support (25,000–25,020) with stop-loss just below 24,980. For Swing Traders (2–3 days) If Nifty sustains above 25,150, expect bounce toward 25,250+. If Nifty breaks below 25,000, expect fall toward 24,900. Risk Management Use stop-loss always. Don’t risk more than 1% of your capital on one trade. Trail stop-loss if trade goes in your favor.
NSE:NIFTYLong
by Knowledgehub
5
ETERNAL 1D Time frame📍 Today’s Expected Range (Intraday Approximation) Expected High: ₹341–₹343 Expected Low: ₹336–₹335 These are approximate intraday levels. Actual prices may fluctuate slightly due to volatility. 🔍 Key Points Current price: ₹337–₹338, trading near the middle of the day’s range. If price breaks above ₹343 with strong volume → bullish momentum likely. If price falls below ₹335 → short-term correction or pullback possible. 📊 Suggested Trading Strategy Bullish Scenario If Eternal breaks ₹341–₹343, you can buy, targeting ₹348–₹350. Stop-loss: ₹335 Bearish Scenario If Eternal drops below ₹335, you can sell/short, targeting ₹330–₹325. Stop-loss: ₹338 Range-Bound / Sideways If price trades between ₹335–₹343, it’s better to wait and avoid trading until a clear breakout occurs. 💡 Summary Resistance Zone: ₹341–₹343 Support Zone: ₹335–₹336 Strategy: Trade in the direction of the breakout, and always use stop-loss to manage risk.
NSE:ETERNALLong
by Knowledgehub
8
SUNPHARMA 1D Time frame🔍 Current Price Approximately ₹1,646 – ₹1,650 🧮 Strategy / Trade Ideas Long Setup: If price holds above ₹1,630 – ₹1,620 and shows reversal signals (bullish candle etc.), opportunity to go long. Target zones: first towards ₹1,655 – ₹1,660, then potentially ₹1,675 – ₹1,680. Stop-loss could be just below support around ₹1,620 to manage risk. Short / Pullback Setup: If price faces resistance near ₹1,655 – ₹1,660 and fails to break with conviction. Potential downside toward ₹1,630 first, then ₹1,600 if that support doesn’t hold. Breakout Setup: If price clears and sustains above ₹1,675 – ₹1,680, especially closing above ₹1,745 – ₹1,755, there may be scope for further upside. ✅ Summary Sun Pharma on the daily chart is moderately bullish. Key for continuation is holding above support in lower ₹1,600-₹1,630 zone, and overcoming resistance around ₹1,655-₹1,660. A breakout above ₹1,675-₹1,680 would strengthen bullish case; failure to hold support could lead to downside.
NSE:SUNPHARMALong
by Knowledgehub
2
TATAMOTORS 1D Time frameCurrent Price: 707 Current Trend: Strong bullish momentum; stock is trading near recent highs. Support Zone: Immediate support at 695 – 700. If this holds, uptrend remains intact. Resistance Zone: Next resistance at 720 – 730. A breakout above this can push toward 750+. Indicators: Daily candles are bullish, showing higher highs and strong buying interest. Outlook: Above 720 → continuation of bullish rally likely. Below 695 → minor correction possible toward 680–685. 👉 In short (with 707 current price): Bullish tone. Range to watch: 695 – 730.
NSE:TATAMOTORSLong
by Knowledgehub
8
SENSEX 1D Time frameCurrent Trend: Still sideways to mildly bullish, but trading closer to support levels. Support Zone: Now the strong support shifts to 82,300 – 82,500. If this zone holds, bounce is possible. Resistance Zone: On the upside, watch 83,200 – 83,500 for resistance. Breakout above this can push price higher. Indicators: Daily candle suggests consolidation; buyers defending 82,300 zone. Outlook: Above 83,500 → fresh bullish momentum likely. Below 82,300 → weakness can extend further. 👉 In short (based on 82,626 level): Range: 82,300 – 83,500. Market neutral, waiting for breakout either side.
BSE:SENSEXLong
by Knowledgehub
6
TCS 1D Time frameCurrent Snapshot Price: ₹3,174 Stock has moved above earlier resistance zones (₹3,150 – ₹3,170). Momentum looks positive, buyers are holding strength. 📌 Key Levels Immediate Resistance: ₹3,190 – ₹3,200 Next Resistance: ₹3,220 – ₹3,250 Immediate Support: ₹3,150 – ₹3,160 Stronger Support: ₹3,100 – ₹3,120 ✅ Outlook If TCS sustains above ₹3,170, it can extend the rally toward ₹3,200 – ₹3,220. If it slips back below ₹3,160, consolidation may happen around ₹3,120 – ₹3,150. Larger trend remains bullish as long as price stays above ₹3,100.
NSE:TCSLong
by Knowledgehub
BAJFINANCE 1D Time frameCurrent Overview Price is trading around ₹995 – ₹1,008. Recently touched a 52-week high near ₹1,025. Stock is moving above 50-day and 200-day moving averages, showing a strong uptrend. ⚙️ Indicators (Daily) RSI (14) → Slightly overbought, but still stable. MACD & Momentum → Mixed to positive, buyers still in control. Volume → Strong volume seen near recent highs, showing active participation. 📌 Key Levels Immediate Resistance: ₹1,010 – ₹1,025 (recent top). Immediate Support: ₹995 – ₹1,000 (nearby cushion). Stronger Support: ₹950 – ₹980 zone (50 & 100-day moving averages).
NSE:BAJFINANCELong
by Knowledgehub
SENSEX 1D Time frameCurrent Status Sensex Level: 82,623 Change: +594.95 points (+0.73%) Opening: 81,852 Day’s Range: 81,780 – 82,443 52-Week Range: 71,425 – 85,978 📈 Market Sentiment Trend: Mildly bullish Leading Sectors: Auto, Realty, Telecom Investor Mood: Optimistic, but watching global cues 🔍 Key Levels to Watch Immediate Support: 81,800 – 81,850 Resistance Zone: 82,400 – 82,500 Psychological Milestone: Breaking above 82,500 may push higher 🧭 Outlook Sensex is showing positive momentum supported by strong sectors. Bulls are slightly stronger, but resistance near 82,400–82,500 may cap upside. A drop below 81,800 could bring downside pressure toward 81,500–81,400.
BSE:SENSEXLong
by Knowledgehub
HDFCBANK 1D Time frameCurrent Stock Price Current Price: ₹966.85 Day’s Range: ₹965.15 – ₹974.40 52-Week Range: ₹806.50 – ₹1,018.85 Market Cap: ₹14.88 lakh crore P/E Ratio: 21.03 EPS (TTM): ₹45.97 Dividend Yield: 1.13% Book Value: ₹339.84 📈 Trend & Outlook Short-Term Trend: Mildly bullish; stock showing positive movement in recent sessions. Resistance Levels: ₹974.40 (day’s high), ₹1,018.85 (52-week high). Support Levels: ₹965.15 (day’s low), ₹950.00 (recent low). Investor Sentiment: Positive, supported by institutional buying and favorable outlook. 🧭 Key Notes Stock has room to move higher if it breaks near-term resistance. If it falls below support, downside may extend to ₹950 or lower. Overall, bulls are slightly stronger, but watch resistance for profit booking.
NSE:HDFCBANKLong
by Knowledgehub
6
BHARTIARTL 1D Time frameCurrent Stock Price Current Price: ₹1,944.50 Day’s Range: ₹1,933.25 – ₹1,944.85 52-Week Range: ₹1,510.80 – ₹2,045.80 Market Cap: ₹11.63 lakh crore P/E Ratio (TTM): 31.89 EPS (TTM): ₹60.94 Dividend Yield: 0.82% Book Value: ₹150.17 📈 Trend & Outlook Short-Term Trend: Bullish; the stock is trading near its 52-week high, indicating strong investor confidence. Resistance Levels: ₹1,944.85 (day’s high), ₹2,045.80 (52-week high). Support Levels: ₹1,933.25 (day’s low), ₹1,910.00 (psychological support). Investor Sentiment: Positive, with strong institutional interest and favorable analyst outlooks. 🧭 Analyst Insights Valuation: The stock
NSE:BHARTIARTLLong
by Knowledgehub
2
RELIANCE 1D Time frameCurrent Price & Trend Trading around ₹1,395 Price is below many of its short- to medium-term moving averages (50-day, 100-day), suggesting resistance in that zone. Indicators & Momentum Relative Strength Index (RSI) is in mid-range → neither overbought nor oversold, leaning neutral. MACD is weak to mildly bearish in daily view. Volume has shown mixed behaviour; resistance zones are not being convincingly broken. Trend strength indicators show some weakening or caution among buyers.
NSE:RELIANCELong
by Knowledgehub
4