Re: 1 lakh to 652 lakhs in 497 trading days - Winning 20% of Trade in NIFTY Futures -
28-Jun-13 - Intraday Options
At 9:40 AM
MAX CE Volume @ 5800 CE
MAX PE Volume @ 5700 PE
Range as per my calculation is 5684 to 5822. So Today 5822 might be the Top. So you can go Long around 5762 or Go short around 5822 (Playing for 60 points). The Long term range points 5600 to 6000 as told Yesterday.
For options Trading No Trading Yet... Look for a change in the Strike Price. Either 5800 CE should become 5900 CE. or 5700 PE should become 5600 PE.
Forgot to notice that Today the Low was 5761.15 in NF. So you can go for the Intraday Options
Sell 1 Lot 5700 PE @ 78.75
Buy 1 Lot 5800 CE @ 97.2
Close the poistions at 5822 or Reverse your positions
At what price to enter for Intraday?
Similar to the Positional Strategy where a combined price of 90-95 is entry point.
Same way look for a combined price of 180 in Intraday. So you will SELL 1 lot at @ around or > 90 and Buy 1 lot around at < 90.
Is it a Golden rule and whether it will work always?
I do not know for sure. But this is based on my watching the Options chain. If the experts have a better rule please let us know
Please hold your positions. As told to you in the morning 5762 was my level. so it was better to take the positions around 5762 keeping Stoploss of as 5742. Trade with Stoploss
One more important point on the timing of closing the Positions
Intraday : Close when the volatility is high. I mean when the it is going UP and DOWN and when the levels are met. To put it simply after the storm is over.
Postional : Close when the Storm is settled... And when everybody is bored... Or when the Storm is about to be set. Before the storm is Yet to start (Or when you see a change in MAX Volume Levels in Intraday)
While the OI is going up, The volumes are low. So the big fellows are still making the market.
Overall the Change in OI for CE is 73 Lakhs and For PE it is 1 Crore. So a lot of Long build UP is going on right now... We always have to take a snpshot and compare it after one hour. so let us see the values at 11:30
5800 CE made high of 102. 5700 PE made low of 71.
As suggested close your positions around 5800-5810 NF
At 11:50 AM the Options data
180K 5800 CE being SOLD compared to 131K 5700 PE. Still the volume is less
OI - 19L 6000 CE SOLD, 5600 PE SOLD
Overall OI CHG - 78L CE, 1.12 Crore PE
Hope you are closing your positions now... 5700 PE at 67 5800 CE at 105.
There was a mistake in my CE Strike Price. We should have bought 5700 CE instead of 5800 CE. Never BUY an Option with MAX Volume.
For Reversal, We can sell 1 lot of 5800 CE and BUY 1 lot 5800 PE.
May be there is a Signal for Reversal has come, MAX OI CHG in 5800 CE (23L) and 5700 PE (39L)... It rather seems to be Bear Trap - So close the postiions avoid any trade... Remember in the morning the The Max OI was at 5600 and 6000
MAX CHG OI changed back to 6000 CE and 5700 PE (In the morning it was 5600 PE) - So positional traders can sell 1 lot of 5700 PE and 1 lot 6000 CE and take profit on Monday. It is available at a combined premium of 95. It also confirms that market might test 5700 and not 5600...
Today's Range of 5762 to 5822 was achieved, even though I was skeptical that it would reach 5822 (normall the problem in trading). There was enough reason for that because from 12:30 to 2:30 pm, those who traded might have noticed the numerous whipsaws, so it was better to close between 5810 to 5820. I also told around 1 pm to close the long positions and wait.
So all in all, the strategy seems to work. Very simple strategy which anybody can follow.
However one mistake we dis was to Buy 5800 CE. We should have bought 5700 CE. My opinion is do not buy the Strike where there is Max Volume or Open Interest. Going for a CE, Take the Strike Price one level below. Buying PE, Take one level UP.
Those who have taken the Postional trading also would have decent profit. Today 5600 PE and 6000 CE - combination closed at 70. If it reached 65 then we can close with a nice profit of 30-35 points. Remember this a neutral stategy wihout much risk. So 35 points in 2-3 days is decent profit.
One more opportunity for positional trade at the end of the day. SELL 5700 PE @ 58 and SELL 6000 CE @ 38 - Combined price of 96.
