Nifty : Real time discussions...!

[linkon7]

Hello Linkon7 sir,

I has not trade after I lose my money. I has to learnt when I has do sell options pair way. You are alos not come to this thread for guiding me. Dan sir is also not posting on options startgey. I tell you to tell me that what you has think on Tnsn sir modal, I not able to understand his. It is right to do in diffrent part of the trading capital. I not has this modal. How you has your modal for differnt risk trading. Please tell me here for my benifit and other fellows also.

Thank you and best of luck.

Linkon7 sir, do you thinks that now I can sell the pair nifty index option at now leval. I think that the market not go up from her and also not go much down side also. But the mumbai bomblaslt has can make market go down also. What is your thinkging for this. Or sir, it is good to not trading for 2 - 3 days and then do the tradin after the effact of the news is over in the share market.

Thank you.

Linkon sir if you has time tell me reply now or tell me after market close. Thank you.

you are doing a good job. few bad days is just part of the game. So dont worry.

U have to understand is that a delta neutral strategy will tend to get hit when we have a strong directional bias. So same strategy wont work on all market. Again sometimes, we might remain in a range and vix shoots the roof, then options price shoots up evn though range is not broken.

Its all part of the game. So dont worry about a few bad days. 80% of the time u end with profit and other days you have to live with few loss....

 

[ranger123]

you are doing a good job. few bad days is just part of the game. So dont worry.

U have to understand is that a delta neutral strategy will tend to get hit when we have a strong directional bias. So same strategy wont work on all market. Again sometimes, we might remain in a range and vix shoots the roof, then options price shoots up evn though range is not broken.

Its all part of the game. So dont worry about a few bad days. 80% of the time u end with profit and other days you have to live with few loss....

But sir, how i has to know it is not direction day so I has not to sell the options pair. You has to tell me how you do risk modal because I use full amount to trade sell options pair. Not in part part way. How you do it and how you tell that it is range day and not a directon day for sell option pair.

Thank you.

 

[sihasan]

Hi Linkon, I also have the same issue. Basically on range days I try to fix a target to achieve but in a trending market I would like to stay as long as possible and not fix a profit level, would prefer to trail it rather.

Please provide some inputs on hot to identify trend/ range markets much ahead. Thanks.

But sir, how i has to know it is not direction day so I has not to sell the options pair. You has to tell me how you do risk modal because I use full amount to trade sell options pair. Not in part part way. How you do it and how you tell that it is range day and not a directon day for sell option pair.

Thank you.

 

[sumeetsj]

Nifty PCR chart for 14th July, today there was a good volatile movement.
From options perspective this is what has happened:

1. Heavy put writing at 5500 strike

2. Calls concentration highest at 5700 strike

Range of Nifty for next 4-5 trading sessions will be 5500-5700.
We might test 5700 again

 

[sumeetsj]

Nifty spot eod chart,
5700, level corresponding to 5720-5735, 200 SMA might be tested again.
Sustaining that level would be tough again i feel as long as highest calls written stand at 5700 strike.

 

[linkon7]

But sir, how i has to know it is not direction day so I has not to sell the options pair. You has to tell me how you do risk modal because I use full amount to trade sell options pair. Not in part part way. How you do it and how you tell that it is range day and not a directon day for sell option pair.

Thank you.

The easiest way to know when not to sell options is using an indicator called ADX.When ADX is below PDI and ADX is below MDI, then its a indication that the directional bias is not strong enough to cause a rise in ADX. That's when you can short straddles or strangles.

A better way is to reverse the legs, like shorting 5500 call and 5600 put, this way you can convert the neutral bias to a directional bias by adding a 3rd leg of either 5600 call or 5500 put when either end is about to give way. Till the time, either leg is not threatened dont add the third leg.

 

[linkon7]

Hi Linkon, I also have the same issue. Basically on range days I try to fix a target to achieve but in a trending market I would like to stay as long as possible and not fix a profit level, would prefer to trail it rather.

Please provide some inputs on hot to identify trend/ range markets much ahead. Thanks.

Identifying when market is trending and when range bound is a million dollar question. There are multiple ways of defining this scenario.

a few that i tried are mentioned on post no 34.

http://www.traderji.com/options/50253-linkons-guppybb-system-4.html#post525796

pick your poison...!

 

[columbus]

The easiest way to know when not to sell options is using an indicator called ADX.When ADX is below PDI and ADX is below MDI, then its a indication that the directional bias is not strong enough to cause a rise in ADX. That's when you can short straddles or strangles.

Hi Linkon,

When time permits, put a chart.Thank you.

 

[timepass]

The easiest way to know when not to sell options is using an indicator called ADX.When ADX is below PDI and ADX is below MDI, then its a indication that the directional bias is not strong enough to cause a rise in ADX. That's when you can short straddles or strangles.

ADX = Average Directional Index
PDI = Power Distance Index

What the devil is MDI ?? couldn't find it ..

 

[linkon7]

Hi Linkon,

When time permits, put a chart.Thank you.

as a thumb rule, when adx is below pdi and adx is below mdi, we assume the market has a lack of conviction on either direction.

When adx is above 20 and rising, its a strong trending market.

When PDI is below adx and below mdi, then Bulls are asleep, short the rallies

when MDI is below both the adx and pdi, then bears are on holiday, buy the dips...