NIFTY Options Trading by RAJ

[healthraj]

The MAX Pain has changed from 5300 to 5400 once again.

 

[healthraj]

5195 SPOT is an important PIVOT. Almost all the Resistance and Support lines meet here. So breakout at this point will give at least 50-100 points.

100 points from 5195 more or less reached

NEXT MAJOR Resistance is at 5320, which would not be easily crossed.

 

[Option.Trader]

The MAX Pain has changed from 5300 to 5400 once again.

100 points from 5195 more or less reached

NEXT MAJOR Resistance is at 5320, which would not be easily crossed.

The Max pain worked to perfection, but still not sure if it was just short covering playing out. For me luck played a larger part, I had limit order of 5300 ce taken @8.6 and kept 6.6 as stop loss. The stop loss order got rejected and I came out finally at 35. Sometimes it's nice to get lucky

 

[prabhsingh]

Near to 5270 is 0.38 fib value so i think its good to go Short around that levels.If not then next level is 5320.

Nifty retraced exactly 50% (0.50) which was 5319 levels and now from here it will start downward slope again.

 

[healthraj]

100 points from 5195 more or less reached

NEXT MAJOR Resistance is at 5320, which would not be easily crossed.

After touching 5320, NIFTY came down 40 points. Enjoy those who traded Short at 5320

 

[Option.Trader]

This triggers a good observation. When the MAX OI is at say 5300-5600, normally 50 points movement is accepted below or above the range. But when there is a more than 1% movement you have to consider that as a Breakout. Yesterday 5270 was a big resistance and when 5250-5270 was broken it gave 200 points from 5300. I have observed this in Stock Futures also. So people looking for Breakout trades can also observe the MAX OI. I would suggest that more than 1% movement on the MAX OI should be considered as Breakout.

When Nifty went to 5110, what was the Max pain value? And since it was greater than 1% movement, how could we look at trading at that level? Will it gravitate towards 5200 if that was the new Max pain or will it be more beneficial to trade downwards.. leaving today's short covering, if we can debate the answer to this, it would greatly benefit option trading at expiry

 

[arcus]

For the past 2 weeks, Nifty seems to be in this channel

 

[healthraj]

When Nifty went to 5110, what was the Max pain value? And since it was greater than 1% movement, how could we look at trading at that level? Will it gravitate towards 5200 if that was the new Max pain or will it be more beneficial to trade downwards.. leaving today's short covering, if we can debate the answer to this, it would greatly benefit option trading at expiry

When NIFTY was 5100, The MAX Pain was at 5300. When the market reached around 5300, the MAX Pain changed to 5400. Yesterday it was at 5400. Just one day for Expiry and so the SEP-13 MAX Pain is at 5500. So I think even if there is further downside movement, Market will once again test 5500.

Probably we should Observe and see what happens when the MAX Pain Changes. I was always thinking the MAX Pain is useful only during Expiry. But in this Expiry the MAX pain itself is changing like every three hours. So my opinion is that whenever it changes, the market tries and goes to the new value or in that direction. If we have to go by that rule. The latest MAX Pain is 5400. So we can expect the market to expire around 5400. We will anyway see the result tomorrow

 

[Option.Trader]

Probably we should Observe and see what happens when the MAX Pain Changes. I was always thinking the MAX Pain is useful only during Expiry. But in this Expiry the MAX pain itself is changing like every three hours. So my opinion is that whenever it changes, the market tries and goes to the new value or in that direction. If we have to go by that rule. The latest MAX Pain is 5400. So we can expect the market to expire around 5400. We will anyway see the result tomorrow

"When Max pain changes, the market tries and goes to the new value or in that direction"

Just trying to understand the implications... it changed from 5400-5300 yesterday, but the markets went towards 5100 instead.. so are you suggesting that when it changes, it would go a 100 points away from it?
I remember you telling a while back that there is a possibility of it expiring a 100 points away from the level as it happened last month?

Also a caveat to all the followers, not to put all your savings with Max pain as yet... the last days trade are really trades in mass destruction.. one min and everything changes.. so please exercise caution

 

[Option.Trader]

For the past 2 weeks, Nifty seems to be in this channel

This is interesting.. .somehow the kind of swings that we are seeing makes me wonder if its a result of Algo trading... most of the massive jumps in trading have been at well identified S/R... but previously we wouldnt swing back this violently... somehow looks like at key levels all the orders came rushing through.. maybe what you have been successfully following is one way to beat the algo traders..join the party once the S/R's are broken for quick gains