Weekly Market Update | Nifty and Banknifty option strategy for 23rd September Expiry

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Hey folks! I hope you are safe and healthy in this COVID-19 pandemic. Every week in this weekly newsletter we are analyzing the weekly trend/range based on the chart and open interest data and based on that we are selecting our nifty and banknifty option strategy for the coming week.

In every newsletter, I’m sharing some tips or the methods that a newbie can follow to be a successful trader in this share market. Today I’m sharing “Why a trading plan is important?

Importance of a trading plan in share market

When coming into a field such as stock trading where personal choices translate into losses or profits, acquiring a well-outlined and easy-to-follow strategy can make the difference between failure and success.

Having a strategy to be prosperous in almost any area of endeavor is highly recommended, but investing in the stocks or any other financial market with no plan is practically a certain recipe for failure.

Having targets set in advance and knowing when to come out from a trade constitutes a significant part of successful stock trading. Bear in mind, a trade has to be liquidated for a gain to be accomplished. Virtually every successful trader in the markets is dependent upon some kind of strategy or guidelines for their achievement. Let us talk about some advantages and the importance of a trading plan.

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Advantages of a proper trading plan

Possessing a trading strategy before starting to trade is similar to having a map prior to beginning to travel. Can you choose a trip without understanding how to get where you’re going?

Trading at the stocks with no trading strategy, even if you are trading in demo accounts, may be a difficult experience once you start trading with real money.

Fundamentally, using a trading strategy helps traders handle trading in the stock market like a small business. We all know that stock trading is running a company that has a proper business strategy to increase its profit.

What’s more, the objectivity and clarity about a perfect trading plan could be a real blessing when making some quick trading decisions to make money from the most opportunities that might appear from the often fast-moving stock market.

When participating in a risky market like stock trading, It can finally be the deciding factor between success and failure if you are having sufficient confidence to come back to the market after having a loss from a trade taken emotionally. That’s what a trading plan will do for you. It will give you the confidence to repeat that same thing day after day.

Emotions Can Produce Havoc When Trading Stocks

Proper rules in the trade plan help traders maintain their trading psychology and emotions during a trade at a minimum. 1 indication of a successful trader consists of an undaunted attitude regardless of market direction. The mature trader seems to be calm no matter what the market conditions.

Common human emotions like greed, fear, and trust can result in a serious problem when trading stocks, so having a good approach to managing them when they inevitably arise can help you overcome many common stock trading pitfalls. Read more about trading psychology here.

Once discipline is dropped after trading, the trader will then be significantly more inclined to trade emotionally and can potentially incur huge losses as an outcome.

Accordingly, to find the best odds of succeeding when trading stocks, remember to prepare yourself before you begin to trade by organizing your trades objectively then proceeding with your strategy as strictly and calmly as possible.

Overall, a good trading plan will help you

  1. Identify your goals
  2. Organize your market research and trading activities
  3. Decide when to take a position, when not to take a position and in what direction
  4. Manage your emotions and trading risk once you enter a position.

So I hope you know how important a trading plan is. So before you start your trading with real money, you should keep your trading plan ready. If you need my help to build a proper trading plan to trade with limited risk option hedging strategies, can hit the below button.

Nifty Weekly analysis with Nifty option strategy

Nifty chart today

As I have shared in the last weekly newsletter that After gave a breakout from 16000, we saw a good rally in Nifty and it broke all the resistance zone very comfortably. Nifty is hitting all the upside targets and showing a very good and strong upward rally.

Nifty had hit oue targe of 17710 that I have shared in the previous weekly article [Best Nifty and Bank nifty weekly options strategies for 09th Sep 2021], very confidently. Now What next?

If you look at the above chart, you can see clearly that 17981 &18347 are the resistance levels for now and a breakout from 18347 will open a new path to the next target of 19034. So bet with long trade with trailing stop loss only.

On the downside, 17250 is the support zone for the short term and a breakdown will lead to the next downside levels.

The overall trend is UP and there is no sign of weakness. So any contra trade is not advisable. Trade with the trend only.

Option chain analysis for Weekly Nifty option strategy

nifty weekly option chain analysis

Based on option chain data, the highest Open interest stands at 18000 CE & 17700 PE, followed by 17800 CE & 17000 PE. PCR of all strikes is 1.42, which indicates an overbought market. PCR at 17500 stands at 4.33, which is acting as an immediate support level.

The Put-call ratio at 18000 stands at 0.05, which is acting as a resistance level. Equally, important indicator Option Pain is at 17700, indicating weekly expiry at 17700. A shift in option pain will provide further levels of expiry. So keep tracking max pain.

Significant open interest buildup on both sides. Indicating a range-bound activity only. So based on the OI, the possible range for this week should be 17500 – 18000.

Keep tracking change in open interest to analyze market participant’s behavior, so that you can adjust your position accordingly. If you don’t know how to analyze open interest fo find best option trading strategy in nifty and bank nifty. Just enroll for our Option Strategies – A Mentorship Program.

Nifty weekly options Strategy: Iron Condor

Weekly Nifty option strategy

Possible adjustments:

Initially, you can keep a stop loss of 17500 & 18000 for this strategy. Means square off if you find nifty is giving a breakout or breakdown. Or you can do this adjustment too. ( Do not hold this strategy is loss is more than 4000₹).

If you find that Nifty is giving a breakdown and sustaining below 17500, then square off call spread and bring it down to 300 points lower levels.

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The same thing you can do with put spread means if you got a breakout from 18000. You can shift your put spread to 300 points up.

If you want to learn how to find the best nifty and banknifty option strategy and its adjustments in more practical ways with live mentorship, You can enrol in our Option Strategies – A Mentorship Program.

Banknifty Weekly analysis with banknifty options strategy

Banknifty chart today

After spending more than 3 months in a tight range finally, BankNifty gave a breakout from 36000.

This week we saw a very good upside rally that helped banknifty to hit our target of 37600 that I have shared in the last weekly newsletter. I also mentioned that a breakout from 37600 will open new doors for the upside rally in BankNifty.

BankNifty gave a breakout from 37600 also and trying to sustain above this level. A sustainable rally will lead to the next target of 39740.

Now On the downside 36400 is acting as the strong support level and a breakdown will lead to further downside levels.

As we are the limited risk strategies traders, we should not bother about any unexpected movement. Because if you are trading with limited risk strategies (hedging strategies), you can easily adjust yorr possition according to market trend and behaviour. So focus more on limited risk strategies.

I’m expecting some good earnings in the coming sessions. So follow us on different platforms very closely for some real-time updates.

BankNifty weekly analysis based on the option chain analysis

banknifty option chain analysis

Based on Bank nifty option chain data, the highest Open interest stands at 38000 CE & 37500 PE, followed by 38500 CE & 37000 PE. PCR of all strikes is 0.75, which indicates a neutral zone. PCR at 37000 stands at 4.66, which is acting as an immediate support level.

The Put-call ratio at 38000 stands at 0.32, which is acting as a resistance level. Equally, important indicator Option Pain is at 37700, indicating weekly expiry at 37700. A shift in option pain will provide further levels.

If you don’t know how to do the bank nifty weekly options chain analysis to find your banknifty option strategy, Just enroll for our Option Strategies – A Mentorship Program.

BankNifty option Strategy: Iron Condor

banknifty option strategy

Possible adjustments:

Possible adjustments for this best banknifty option strategy are:

If you find that BankNifty gives a breakdown and sustaining below 36700, then shift your Call spread to 1000 points down.

The same thing you can do with put spread means if you got a breakout from 38300. You can shift your put spread to 1000 points up.

If you want to learn this banknifty option strategy and its adjustments in more practical ways with live mentorship, You can enroll in our Option Strategies – A Mentorship Program.

Post your comments in the comment box if you have a query related to the Best Nifty and BankNifty option Strategy. You can ask any question related to option trading in the comment box.

If you need More real-time assistance on how to find the Nifty and Banknifty option strategy, Can take our premium subscription or open a trading account with us and you will get real-time assistance every month on the weekly Nifty and banknifty option strategy. You can contact us on WhatsApp

*( Please avoid any question like which Call or Put we should buy in the coming week).


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The best strategy for Bank Nifty Future Intraday

If you’re looking for an intraday trading system that will work out well for you no matter which market condition we are in, then this strategy is perfect for you. It has been backtested in all kinds of conditions and has shown great potential.


DISCLAIMER: – we are not a SEBI research analyst. Views or the nifty and banknifty option strategy posted here only for educational purposes. There is no liability whatsoever for any loss arising from the use of this product or its contents. This product is not a recommendation to buy or sell, but rather a guideline to interpreting specified analysis methods.  This information should only be used by investors and traders who are aware of the risk inherent in securities trading.

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Avatar of Sachin Sival

Sachin Sival is the founder and CEO of Replete Equities, an options trading company that specializes in delta hedging. A self-taught trader, Sachin has a passion for volatility trading and stock trading. Sachin loves to hone his skills by reading up on new strategies and techniques as well as taking part in industry events. In addition to being a successful entrepreneur, Sachin also takes pleasure in photography - as a hobby.

2 thoughts on “Weekly Market Update | Nifty and Banknifty option strategy for 23rd September Expiry”

    • Hello Deepak. Pair trading and hedging, both are two different terms. Pair trading is when you match a long position with a short position in two stocks with a high correlation. And hedging is the strategy when you try to limit your risk in a particular script.

      The strategy you have shared is a long gut and will give you profit if Nifty expires above 18000 or below 17000. You will lose around 100₹ premium that you have paid in terms of time value to buy these two strikes if Nifty expires between 17000 – 18000.

      Reply

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