Hello guys, How are you? I hope you are doing good. Today I’m sharing a high probability option strategy in NIITTECH. In this article, I will share why and how I choose that option strategy? Read this post till the end and share your feedback in the comment box.
I’m writing this article, not to give any buy/sell recommendations. I just want to share how I’m creating these strategies to generate some consistent returns.
To deploy an Option strategy, You don’t need to be perfect in trend selection or any price action. If you don’t know about technical analysis, that’s too totally perfect.
Only a few things you need to understand before initiating an option strategy. You have to learn, How we calculate the option premium? What are the factors, due to which option premium will effect like Greeks, Implied Volatility, etc
We are talking about these factors very deeply in our Option Strategies – A Mentorship Program
A high probability option strategy in NIITTECH
Before going further let s look at the chart first. You can see on 17th December there is a huge upside movement in NIITTECH. Now NIITTECH is trading around 1600 which was its resistance previously.
Now 1600 is a very crucial level, if NIITTECH manages to sustain above this level then we may see some more upside levels. This is a very good stock for your medium to long term portfolio with a positive trend.
Based on the charts we can see 1660 is the first resistance and 1520 is the first support level. Let us look at the Open interest data.
Open Interest analysis for NIITTECH
Based on OI data, Highest Open interest is at 1700 CE and 1500 CE followed by 1600 CE and 1540 PE. PCR for all strikes is at 0.60 which indicates an overbought market.
PCR at 1600 CE is at 0.40 which is acting an immediate resistance level. PCR at 1560 PE is at 4.8 which is acting as an immediate support level.
Based on OI data, we can say 1600 is the first resistance and 1660 is second resistance. on downside 1560 is the first support and 1540 is the second support followed by 1500 as a strong support level.
Now we have a range of 1660 – 1540, based on this range I’m creating a strategy. I’m not keeping a wide range because w have just 9 days to expiry. If we got any breakout or breakdown from our breakevens, we will do the adjustments.
Now one more thing we need to keep in mind that,
A high probability option strategy in NIITTECH – Iron Condor
You can see, our breakevens are 1540 & 1660. So until NIITECH is trading between this range, we will make money. Now, what should be our adjustments if our breakevens breaches?
If you got a breakout from 1660. book profit in PUT Spread and shift it to 40 points higher. means sell 1600 PE and buy 1560 PE.
Same thing you can do with Call spread after a breakdown from 1540. Means shift your 40 points down to 1600.
You can join out Options Strategies – A Mentorship program to learn these adjustments in a practical way.
I hope my articles are helping in your profitable trading. If you have any feedback or suggestions please type in the comment box. Your feedback will help me to do something better in the future.
Please type your queries related to a high probability options strategy in NIITTECH in the comment box. I will try to answer all your queries.
Much Check this also- Option Buying vs options selling, Modified Condor Option Strategy in VEDL, Bull Call Ladder in ZEEL, Iron Condor in SBIN, Why People Lose Money & Nifty and Bank nifty index analysis with Option Strategy,
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Options Strategies – A Mentorship Program
On the 1st of September, We have launched a new mentorship program for Option strategies, in which we are discussing how can we deploy these strategies? What rules we should follow before taking a trade? and what should be our adjustments if the script is moving against your direction?
DISCLAIMER: – we are not a SEBI research analyst. Views 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.
8+ Years working as a derivative trader, Option Writer, Blogger, Trader by passion, Keen Follower of Indian share market