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Weekly Market analysis with option strategies for 04th March Expiry

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Hello guys. I hope you all are doing good. The market is highly volatile. In fact, 2021 is the year of high volatility. In my weekly market analysis and options strategies post, I’m sharing that we should trade with proper risk management.

Risk management is the only holy grail to get success in this stock trading. So analyse your risk profile first and choose a product or segment to trade based on your risk profile.

This week was highly volatile. We saw some big movement in both directions this week. In this type of market, it is tough to make a directional bias, so we should trade with limited risk strategies.

Because volatility is high, so premiums also increased, and when premiums are high, time to create some credit spreads. But that’s not mean that you should initiate short strangle or straddles. It would be best if you had to limit our risk first.

You can keep some extra risk on the upside, but your risk must be limited on the downside. The reason is: You will get time to adjust in the upside movement, but downside movement will not give you time to adjust your positions.

In simple words, the Downside movement is always strong compare to the upside movement, so we have to lock our risk on the downside. Choose your strategies accordingly.

Let’s come to our weekly analysis and option strategies for 04th March 2021 weekly Expiry. Let’s look at the chart first,

Nifty weekly market analysis and options strategies

Nifty weekly market analysis and options strategies

After made an all-time high of 15431.75 on 16th February, we saw some profit booking from higher levels that drag nifty to the lower levels till 14630.

In my last weekly market update post, I have said that there is a negative diversion on RSI, indicating that we may see some downside levels in the coming session and 14800 – 14600 are acting as immediate support levels and a breakdown from 14600 will lead to the next levels at 14350 & 13500

This week nifty hit our first support level at 14800 and almost hit the second support level at 14600. Later we saw a recovery and Nifty hit 15176 on 25th Feburary.

Now if you look at the Fibonacci tool you will find that 14815 & 15196 are acting as the important levels. A breakout from 15196 will give us a new upside level till 15577 and a breakdown from 14815 will drag nifty to the lower level till 14343.

The overall trend is UP and a short trade is not advisable here. But you should keep your position with a proper hedge. Use tight stop losses for your long positions or use options to limit your downside risk.

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Nifty weekly market analysis based on option chain data

Nifty weekly market analysis based on option chain data

Option chain data indicates that the highest Open interest is at 15000 CE & 14800 PE, followed by 15100 CE & 14000 PE. PCR of all strikes is 0.73, which indicates a neutral market. PCR at 14500 stands at 10, which is acting as an immediate support level.

The Put-call ratio at 15000 stands at 0.51, which is acting as a resistance level. Equally, an important indicator, i.e., Option Pain, is at 14900, indicating weekly expiry at 14900. A shift in option pain will provide further levels.

Significant open interest buildup around the call side indicates that nifty is facing good resistance from higher levels and expecting some downside activity in the coming week. Based on Option chain data, 14500 & 14000 are the support levels & 15000 & 15200 are the resistance levels for this expiry.

Keep tracking open interest to analyze market participants’ behavior if you don’t know how to analyze open interest. Just enroll for our Option Strategies – A Mentorship Program.

Nifty Weekly Expiry Strategy: Iron Condor

nifty weekly option strategy

Possible adjustments:

Initially, you can keep a stop loss of 14150 & 15050 for this strategy. Means square off if you find nifty is giving a breakout or breakdown. Or you can do this adjustment too.

If you find that Nifty is giving a breakdown and sustaining below 14050, then square off call spread and bring it down to 500 points lower levels.

The same thing you can do with put spread means if you got a breakout from 15050. You can shift your put spread to 500 points up.

If you want to learn these strategies and their adjustments in more practical ways with live mentorship, You can enrol in our Option Strategies – A Mentorship Program.

Bank Nifty Weekly analysis with weekly expiry strategy

Banknifty weekly analysis

After made an all-time high of 37708.75 on 16th February, we saw some profit booking from higher levels that drag nifty to the lower levels till 34975.

In my last weekly market update post, I have said that 35500 – 34500 are acting as immediate support levels and a breakdown from 34500 will lead to the next levels at 32600 & 31500. A breakdown from 29700 will convert the short-term trend into bearish. So no short trade until Nifty is holding 29700.

This week Banknifty hit its first support level at 35500 and moving towards the second support level at 34500.

Now, if you look at the Fibonacci tool, you will find that 34485 & 37422 are acting as the important levels. A breakout from 37422 will give us a new upside level till 39513, and a breakdown from 34485 will drag nifty to the lower level till 32677.

The overall trend is UP, and a short trade is not advisable here. But it would be best if you kept your position with a proper hedge. Use tight stop losses for your long positions or use options to limit your downside risk.

Bank Nifty weekly market analysis based on option chain data

banknifty weekly option chain

Option chain data indicates that the highest Open interest is at 37000 CE & 35000 PE, followed by 36000 CE & 34000 PE. PCR of all strikes is 0.67, which indicates a neutral market. PCR at 34000 stands at 10, which is acting as an immediate support level.

The Put-call ratio at 36000 stands at 0.28, which is acting as a resistance level. Equally, an important indicator, i.e., Option Pain, is at 35500, indicating weekly expiry at 35500. A shift in option pain will provide further levels.

Significant open interest buildup around the call side indicates that nifty is facing good resistance from higher levels and expecting some downside activity in the coming week. Based on Option chain data, 34500 & 34000 are the support levels & 35000 & 13600 are the resistance levels for this expiry.

Keep tracking open interest to analyze market participants’ behavior if you don’t know how to analyze open interest. Just enroll for our Option Strategies – A Mentorship Program.

BankNifty Weekly Expiry Strategy: Broken wing butterfly

Weekly Market analysis

Possible adjustments:

For this strategy, follow a stop loss of 3700. means square off this strategy if you see a breakdown from 37000. On upside no adjustments required.

If you want to learn these Weekly expiry options strategies and their adjustments in more practical ways with live mentorship, You can enroll in our Option Strategies – A Mentorship Program(33% OFF).

Much Check this also– Performance of the Option strategies, Nifty & BankNifty Weekly Analysis with Option strategy, Nifty Option Strategy for Budget SessionA low-risk options strategy in LICHSGFINAn iron condor options strategy in ICICIBANKReverse Jade Lizard options strategy in UPLA high probability options strategy in YESBANK

Post your comments in the comment box if you have a query related to weekly market update and options strategies. You can ask any question related to option trading in the comment box.

If you need More real-time assistance on Nifty and Bank nifty weekly market update and options strategies Can take our premium subscription or open a trading account with us and you will get real-time assistance every month on these weekly options strategies. 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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DISCLAIMER: – we are not a SEBI research analyst. Weekly market update, Views or the options strategies 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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