Nifty Futures Positional Trading

[Option.Trader]

Long Order raised tad-bit higher at 5553.70
SL 42 points.

Just curious to know... you dont take shorts at all? why wouldnt you be short in this market and only wait for long entry?

 

[jamit_05]

Just curious to know... you dont take shorts at all? why wouldnt you be short in this market and only wait for long entry?

I am trading the Daily timeframe with a system which is designed to capture 10R plus. This system gives one or two entries every month.

This month I got a short entry early, on 24th July. I collected some profit and got out early, which I saw as a mistake and hence made necessary modifications to the Trailing Stop Loss algo.

Currently, the Stop size is around 50 points because the ATR has expanded. As a result, for 10R gain I will need a 500 point move. Therefore, I think, the system is not giving any signals since the price range is of only 250 odd points.

 

[Option.Trader]

FII have reached their MAX OI levels in Index Futures... so one shouldn't expect too much participation from them on the downside...

Therefore, I feel it is a good time to get mentally prepared for longs. And if we are fortunate the chart will give a fill.

Long entry is above the BLUE line...

Jamit.. just a question on this, near the expiry the OI shown would include near as well as rollovers of the next month.. so the OI would not be strictly for the current month right?

For the record, FII OI has risen from your earlier shown 65k to 70K

 

[jamit_05]

Jamit.. just a question on this, near the expiry the OI shown would include near as well as rollovers of the next month.. so the OI would not be strictly for the current month right?

For the record, FII OI has risen from your earlier shown 65k to 70K

Right. Would include OI of all Index Futures.

Yes, has risen. Point being, OI cannot go too much further out... it is already at an extreme. Kind of an overbought level.

 

[jamit_05]

This fall has created a very odd breed of traders. They were probably dormant before this month due to failures. And now they are sure how to make money in the market.

I know this guy for the past year from my yoga class. After yesterdays class, he grabbed both my shoulders with his massive hands and blurted with oozing confidence

"Kya Amit... aaj majboot chaapa hoga".

I replied "Nahi yaar". And honestly so, as I am sitting hands-on for the past few weeks.

He continued "Maine toh pura zor lagakar nifty 5500 puts buy kiya. Aur ek trader ne toh 45 Lakh, teen ghante mein kamaya".

I got worried that he may follow suit the next day and tried to put some sense into him. Alas! I was unable to reach out to him. He retorted saying, "Tere ko kya maloom, Yahi Time hai kamane ka!"

Short squeezing of these over confident positions is going to fuel the next uptrend whenever it starts. This easy money breeds tremendous amount of greed in the minds of unorganized traders. They get extremely optimistic about the direction and get blinded by the future prospects. They act as if the other side does not exist! Moreover, they think systematic trading, money management, Risk control are all useless impediments.

It is sad.

 

[jamit_05]

Yesterday was a surprise for many. It is proof that analysis is only indicative (read: "Analysis does not work") and success in Trading is PRIMARILY a function of Money Management.

NSE daily chart has not printed such a candle for a very long time. I checked for 5 odd years. And every time a SIMILAR candle was made the price reversed direction, sometimes temporarily.

Currently, my long entry is 200 points away. So, I am looking for some sort of a technical confirmation to this candle to seek a long entry. If I don't find it, then entry remains above 5529.

 

[Trader_PK]

This fall has created a very odd breed of traders. They were probably dormant before this month due to failures. And now they are sure how to make money in the market.

I know this guy for the past year from my yoga class. After yesterdays class, he grabbed both my shoulders with his massive hands and blurted with oozing confidence

"Kya Amit... aaj majboot chaapa hoga".

I replied "Nahi yaar". And honestly so, as I am sitting hands-on for the past few weeks.

He continued "Maine toh pura zor lagakar nifty 5500 puts buy kiya. Aur ek trader ne toh 45 Lakh, teen ghante mein kamaya".

I got worried that he may follow suit the next day and tried to put some sense into him. Alas! I was unable to reach out to him. He retorted saying, "Tere ko kya maloom, Yahi Time hai kamane ka!"

Short squeezing of these over confident positions is going to fuel the next uptrend whenever it starts. This easy money breeds tremendous amount of greed in the minds of unorganized traders. They get extremely optimistic about the direction and get blinded by the future prospects. They act as if the other side does not exist! Moreover, they think systematic trading, money management, Risk control are all useless impediments.

It is sad.

wah wah Amitji....very very nicely said...I too personally know some guys they were calling me and saying ....."abhi to paisa bana lete hai.... one call me day before yesterday and was very happy and said he made 18 lakh ...I warned him that never excite in this market.....excitement takes money from you.......and yesterday I called him ....answer was "big loss"...even he was not revealing amount....very sad

 

[jamit_05]

OT,

The situation has changed. FIIs majorly squared off OI. It is customary on expiry, but not compulsory.

Now the question worth asking is: In the past how has the price behaved after such massive square-offs?

In the last four months, the trend has changed 3 out of 4 times! Leaving the month of April.

One could argue that in April the trend change was still fresh and the square off was only 1/3rd the size. In contrast, in the next three months the trend had done major damage, lived its life, while taking most indicators to lower extremes on most timeframes.

So it is likely that 5500 gets broken in the days to come.

All this analysis means ZERO if the system does not release a signal.

 

[Option.Trader]

OT,

The situation has changed. FIIs majorly squared off OI. It is customary on expiry, but not compulsory.

Now the question worth asking is: In the past how has the price behaved after such massive square-offs?

In the last four months, the trend has changed 3 out of 4 times! Leaving the month of April.

One could argue that in April the trend change was still fresh and the square off was only 1/3rd the size. In contrast, in the next three months the trend had done major damage, lived its life, while taking most indicators to lower extremes on most timeframes.

So it is likely that 5500 gets broken in the days to come.

All this analysis means ZERO if the system does not release a signal.

Isn't that normal?on expiry day they would rollover and maybe square off a majority of their open interest position. Especially after such swings in current month. I think the first few days of current month shows their inclination, last month they massively built into their puts and squared of their longs in the first week of trading. Let me get back to you after a week and try and correlate if it makes sense. With the data that I have, it still looks that they have added to puts and unwound longs in futures

 

[chemmanian]

I too feel the same way as Option.Trader. FIIs are holding to their puts. Now the squared off positions in futures might have given the FIIs enough money to short Nifty again.
But anything can happen in market. Let us see