Nifty Option strategy as high IV Due to Election Result

[toughard]

low volume, overlapping candles, intraday ranging action are signs of a healthy correction and opportunity to add, if weakness was there then we would have seen different kind of selling.. like regular basket selling with advance/decline favoring declines.

i understand that you are bearish but dont fight the market, whats the logic to sell when market says buy ? sure you can lose 20-30k now but what about 5-10 more trades likes these ? can you lose all of them and still will be comfortable ? with this attitude you are going to get burned both financially and psychologically, think in long terms.

Have a bearish view but be ready to be bullish as well. Let market confirm that its bearish, how charts have to look like that its bearish ? or how overall market should look like if its bearish ? then only put on a trade.

there is nothing wrong in having any view
there in nothing wrong if you have a wrong view
the key is
knowing when to change the existing view...

for me the technical trading is like driving a car on high way just slide as the road goes....

one should not get fixed to one view...
entry-exit-reentry-reversal are common demands of Technical trading...

 

[toughard]

Hi Vertigo

I just wanted to bring in some thoughts in the flow of the post's, as I think it is very important to spot at any good post, in this case from you thumb, from different angels. So thank you to response the way you did. :clapping:

And yes, the trend is really, strongly down, which is not the case in Nifty (Will ad to this). In Infosys one support level after one support level was broken and 3000 would be the next good support level if the 3050 doe's not hold. Then down to 2900 and then free fall.

I heard once: Sell by good news and buy on bad news. Personal choice and also some thing which had to be seen in context to other things.

Nifty: Yes, the up move was expected, as the support level around 6650-60 was expected to be a good one. Why? One of the major and very important points in TA you did not mention with one word: Fibo levels. You may know the 50% retracements rule. If so, then you see that the 6650 - 60 level was fulfilled at 50% retracement. Very strong buy signal. This just a little ad to your valuable post, nice to chat with you and take care

50% fib a strong level?????
all these day I was noticing 38.2% as good support and 78.60% as good resistance!!!
In above case its a matter of confluence of multiple supports and with 50%
the right fib would be

 

[Somatung]

50% fib a strong level?????
all these day I was noticing 38.2% as good support and 78.60% as good resistance!!!
In above case its a matter of confluence of multiple supports and with 50%
the right fib would be

Mr. Boring: Here for you:

:fatigue::fatigue::fatigue::fatigue: and why don't you just go your way and stay out of mine. Good learning and good luck by what ever you do in your life.

 

[comm4300]

toughard yes Agree with u... vol n OI is really low ,,as due to high IV of options only buyers are here so options r being expensive

to add ....

look at NIFTY, BANKNIFTY Option chain:

i fail to understand why exchange won't open up higher strikes in indices and even stocks.

ex.

Banknifty is at 13800 ; highest Call strike 14700; (distance from underlying = 900 points)

lowest Put strike available 9100; (distance from underlying = 4,700 points).


14700 strike call closed at rs.381 per lot.

this a once in 5 year event and exchange could have been proactive in opening up higher strikes.

i fail to understand the rationale behind this inertia on exchange part.

this is me probably grumbling because i had to close out my short spreads without being able to roll UP further OTM.

 

[TradeOptions]

VIX at 37.71 but are you aware where is Historical volatality?

Despite high IV,nifty witnessing trading within a small range!!!!

But obviously,mismatch is happening.Historical volatality seen at 13-14% now.The gap between
VIX & HV is big at the moment and is essentially attributed to an upcoming election event.
Thus,VIX is expected to fall down & one can witness increase in Historical volatality.

Nifty got into volatality mode yesterday...

Further,as one see IV of next series,one could see that its quoting at 25-30..Thus,drop in IV is imminent..

Views welcome!!

Hi umash
Here are some interesting views that I found -

http://investorsareidiots.com/2014/...ated-costs-no-option-strategy-until-16th-may/

The month of May has seen a significant rise in the volatility for the index and stock based options. The Nifty index options have implied volatility to the level of 31% for at the money Put options and 28% for at the money Call options. There has been a rise in the implied volatility by 234% from the levels of 9.27% for at the money put options and by 97% from the levels of 14% for at the money call options that were seen for the Nifty index April 2014 series. The implied volatility for out of the money put and call options are not much below at 29% and 27% respectively.

Regards

 

[toughard]

Mr. Boring: Here for you:

:fatigue::fatigue::fatigue::fatigue: and why don't you just go your way and stay out of mine. Good learning and good luck by what ever you do in your life.

in your way:lol::lol::lol::lol: ...Comment only on Subject Mr. False Sensation
and please stop your wishes after every sarcastic view.... its a old trick...

 

[Somatung]

in your way:lol::lol::lol::lol: ...Comment only on Subject Mr. False Sensation
and please stop your wishes after every sarcastic view.... its a old trick...

Thank you for your kind words and all the best by what ever you do.

 

[TradeOptions]

My sincere request to both - Somatung and toughard bro :hug:

Many of the traders who are new to the world of options trading "just like me" are learning a lot from the valuable posts that you both are making in the forum. Both of you are very valuable members of the traderji community. We respect you both.

Please do not bring any small issues in this great learning experience for all of us. This time is so critical for all the traders, that we should not waste it in any kind of arguments. Although it is a basic human behavior that whenever a group of people will discuss on any topic, some of them will have counter views. But that does not mean that we have to start making fun of each other, because of these opposite views.

Just like there are some members who are totally devoted to Modi bhai these days and consider him as the Messiah who will solve all the problems of India. Whereas there are other guys who just consider Modi as a feku and a media hype created by spending tons of money and who might be actually a danger to the communal harmony of our country.

We are free to have our opposite views on any topic including Modi and Implied Volatility Trading. But we should try to express our views without making it personal and without making fun of the views of the other guys.

So I would like to request both of you to please stop replying to each other posts for the time being, if you are not able to accept the views of each other. If you guys cannot stop it then at-least Postpone the " :argue::gun2:" part to some later date.

Please do not take my post in the wrong manner. I respect both of you. Thanks a lot to both of you.

Regards

 

[Somatung]

@Vertigo

You have a PM.

 

[lemondew]

The best way to annoy a person who irritates you in forums/chat is to STOP RESPONDING to him/her.:annoyed:

My sincere request to both - Somatung and toughard bro :hug:

Many of the traders who are new to the world of options trading "just like me" are learning a lot from the valuable posts that you both are making in the forum. Both of you are very valuable members of the traderji community. We respect you both.

Please do not bring any small issues in this great learning experience for all of us. This time is so critical for all the traders, that we should not waste it in any kind of arguments. Although it is a basic human behavior that whenever a group of people will discuss on any topic, some of them will have counter views. But that does not mean that we have to start making fun of each other, because of these opposite views.

Just like there are some members who are totally devoted to Modi bhai these days and consider him as the Messiah who will solve all the problems of India. Whereas there are other guys who just consider Modi as a feku and a media hype created by spending tons of money and who might be actually a danger to the communal harmony of our country.

We are free to have our opposite views on any topic including Modi and Implied Volatility Trading. But we should try to express our views without making it personal and without making fun of the views of the other guys.

So I would like to request both of you to please stop replying to each other posts for the time being, if you are not able to accept the views of each other. If you guys cannot stop it then at-least Postpone the " :argue::gun2:" part to some later date.

Please do not take my post in the wrong manner. I respect both of you. Thanks a lot to both of you.

Regards