NIFTY Options Trading by RAJ

[healthraj]

The market is more or Less at the Crossroads now - Today it made another bottom of 5257. If this has to be considered as a double bottom then it can make at least 250 points from here on the UP side. If this the middle of Down side then it can make another 250 points on the downside. So either way it can make 250 points on either side. Hopfully if the market does not go sideways in the next month, then we can take some risk and buy some Deep OTM call and PUT. I am going to put just 10% of my capital.

5% in SEP-13 4500 PE @ 12.2
5% in SEP-13 5900 CE @ 9.2

Keep the Positions, till one of the position becomes 3 times so that we will make 100%.

 

[healthraj]

Thanks Shiv. That means we have two more days for Expiry. I am buying 5400 CE @ 11.15 and will keep it till Expiry.

The VOLT is at very high. So those who want to Trade Pairs will give superb result if the VOLT goes down tomorrow. The Pair I suggest is to SELL 5300CE-5300PE. Since the market is at 5300. The Pair is having a premium of 102 now

The market is more or Less at the Crossroads now - Today it made another bottom of 5257. If this has to be considered as a double bottom then it can make at least 250 points from here on the UP side. If this the middle of Down side then it can make another 250 points on the downside. So either way it can make 250 points on either side. Hopfully if the market does not go sideways in the next month, then we can take some risk and buy some Deep OTM call and PUT. I am going to put just 10% of my capital.

5% in SEP-13 4500 PE @ 12.2
5% in SEP-13 5900 CE @ 9.2

Keep it till it the Premium becomes 3 times on one side so that we will make 100%.

So far the Positional Calls given in this month have worked since the market was trending.

Reversal from 5250 to 5500. 5500 CE Bought at 17 closed at 47.
Reversal from 5500 to 5250. 5300 PE bought at 17 - Today it was trading around 60+.

Buying the OTM calls/Puts is always tricky because the next month can turn out to be a Sideways market and it will not give any profit. So my suggestion is trade with less quantity. Not more than 10% of your capital.

 

[Option.Trader]

So far the Positional Calls given in this month have worked since the market was trending.

Reversal from 5250 to 5500. 5500 CE Bought at 17 closed at 47.
Reversal from 5500 to 5250. 5300 PE bought at 17 - Today it was trading around 60+.

Buying the OTM calls/Puts is always tricky because the next month can turn out to be a Sideways market and it will not give any profit. So my suggestion is trade with less quantity. Not more than 10% of your capital.

Is there any other indication of a range being developed through options data? These 250 points swings are phenomenal, have not seen it swinging both ways in such a short period of time. How far is the data reliable in foretelling swings rather than trends?

 

[healthraj]

Is there any other indication of a range being developed through options data? These 250 points swings are phenomenal, have not seen it swinging both ways in such a short period of time. How far is the data reliable in foretelling swings rather than trends?

I would say it is rather a luck than anything else that it has worked because as you said. This month the market has moved some - 1900 points - Which is not possible Every month.

6100-5500 - 600 points
5500 - 5700 - 200 points
5700- 5250 - 550 points
5250 - 5500 - 250 points
5500 - 5250 - 250 points

The only data I can think of is the MAX OI for this swing... When we started the month the MAX OI was 6100-5600. Slowly it was changing. Till Yesterday it was 5300-5600. today it was turned to 5300-5500.

After touching the MAX OI or MIN OI, the sure target is the Positional Pivot, the reason why I suggested 5400 CE. The Positional Pivot is at 5393. So I think before this expiry 5390+ should be achieved. And at this VOLT 5400 should be at 60+.

 

[niftytaurus]

Hi Raj Bhai
I have gone through ur entire thread..its very intresting & give insight into how can we trade option with OI data...thank u very much for this wonderful thread & all the time you have efforted here.
i have some queries..I dont sell options....I only buy..how can I use that data to buy options...both intraday & positional position?
please explain the tools also ,which u have been here discussing ?
thanks

 

[DanPickUp]

@Option.Trader

How many long puts now and how many long calls now? Just the numbers you see them the way you look at your numbers.

 

[healthraj]

One important info for those who are following this thread :

When I started this thread and put down my rules, In the month of Jul-13, the Credit spreads gave good result. When I started this thread, I had limited knowledge and my risk free trade was to sell Options and make minimum 10% in a month. But this month it is really exceptional with market moving nearly 2000 points. So Credit spreads do not work in these highly volatile market. One important indicator as to whether to go for Debit Spread or Credit Spreads is to Look at the VOLT. This month we have seen NIFTY IV like 35+. So in those times there is no point feeding the market with our Credit Spreads. When the market turns to normalcy with NIFTY IV around 20, I would surely go back to the Credit Spreads as the Safe trading option.

Suggestions and comments are welcome

 

[DanPickUp]

One important info for those who are following this thread :

When I started this thread and put down my rules, In the month of Jul-13, the Credit spreads gave good result. When I started this thread, I had limited knowledge and my risk free trade was to sell Options and make minimum 10% in a month. But this month it is really exceptional with market moving nearly 2000 points. So Credit spreads do not work in these highly volatile market. One important indicator as to whether to go for Debit Spread or Credit Spreads is to Look at the VOLT. This month we have seen NIFTY IV like 35+. So in those times there is no point feeding the market with our Credit Spreads. When the market turns to normalcy with NIFTY IV around 20, I would surely go back to the Credit Spreads as the Safe trading option.

Suggestions and comments are welcome

Wouldn't it be much easier to play the put and call credit spread game with big lots by just looking at the bigger TF in any chart and play on this big time frames the Support and Resistance level, what ever those OI with any move daily tell and use those daily OI information to play pure directional option games with less lots? The game on the big picture with CS is much less stressy and needs less analyzes and adjustments. No critique to what you do, just an answer to your welcome any comments.

Take care / DanPickUp

 

[Option.Trader]

@Option.Trader

How many long puts now and how many long calls now? Just the numbers you see them the way you look at your numbers.

There is not much benefit looking at this before expiry. I'm yet to find a way to distinguish OI between near month and future during expiry. With rollovers kicking in it would lead to lots of confusion

 

[healthraj]

Wouldn't it be much easier to play the put and call credit spread game with big lots by just looking at the bigger TF in any chart and play on this big time frames the Support and Resistance level, what ever those OI with any move daily tell and use those daily OI information to play pure directional option games with less lots? The game on the big picture with CS is much less stressy and needs less analyzes and adjustments. No critique to what you do, just an answer to your welcome any comments.

Take care / DanPickUp

I am normally trading only NIFTY. So when the NIFTY makes daily (May be I am exaggerating) 100 points, then the Credit spreads do not work and whatever timeframe you choose if the IV increases 50%, the Credit spreads will be gone. The average IV for NIFTY is around 22%. But for this month It has touched even 40%.