Option Buy Recomendations

[ghosh_ak34]

hi every body this is the first post to our forum i am very happy to see u all here... with ur permission lemme introduce my self i started my part time trading in 2008 feb i thought that was the right time to invest so many ups and downs i dont know any thing about the market i was investing in equties.... later i found margin trading also available...and i thought nice to trade.... and found in june that market was not in good condtion to trade so that i stopped all my activities in trading coming to this march i thought market is not going to break 3000 resisitance(some technical analyist like sukhani and aswin prediction i took) level so at 2800 i shorted with one lot and it dragged me up to 3150 levels and with 4 lots i decided there to quit and the amount more than 70 thousands i lost so one of my friend suggested me to trade in option so that i can get good profits and risk also minimum compare to futures plz help me some body i am reading about options but i am not understading the pivot point rules MR GOSH had given a nice analysis of option trading but still i am not understanding..i want to know what is the formula hehind it and about levels. plz help me i want to get my lost money seriously not in a single session....or two step by step....and want to make it as a profession.. how much i can invest and how can i get profits with consistency..

thanks in advance

srini

Dear Srini,

Its really bad to know that you lost so much. Many bearish traders have lost there shirts and this is what often happends with traders. One can never succeed always. So, its always preferable to hedge your positions.

Now, since you are already at loss so will advice you to take a gasp and do not trade for atleast a month. Analyze yourself and your past trades. Make a list of what all went wrong.

I always recommend everyone to jot down all your emotions during the trading hours, so that you can read the same and analyze yourself. Trading is mental game so you need to control your emotions during the trade.

Will recommend you to 1st prepare a strategy for your trades and prepare daily trading plans accoridngly. Paper trade to test this strategy and see if this strategy gives you profit three months in a row. If it fails to give you profit then, re-look at your strategy and change it accodingly.

You can also paper trade some strategies mentioned in traderji as well.

Regards

 

[ghosh_ak34]

Dear Friends,

For the week starting Mon-Fri, R1= 3400 and S1=3200, R1~S1 is outside the range (300,400] so trade in options as per sideways strategy posted in 1st post of this thread. One can buy Nifty calls at strike price S1=3200 and buy puts at strike price R1=3400 as per side ways strategy posted in the 1st post of this thread.

Nifty is bullish so one can bet on upside then downside this week.

Regards

 

[metushar]

Dear Ghosh Sir,
Its very kind of u to put down option trading strategies......I have a few queries
1. regarding buying in the money options as per your strategy, we generally have gap or gap down these days in nifty, thus if let say someday the resistance or support is broken on monday then how do we trade?
2. For all days of the week the previous week range holds for trading on all the days of the week?
3. How do we determine our stop loss levels ie. using NIFTY value and there by calculating the SL option price according to that or straightaway on options ?
E.g. - Bought 3300CE at 100 then my SL should be at 70-80 or I should fix my SL at Nifty - 30% of range (R-S) then calculate the price of option at tht nifty and fix my SL ?
Kindly resolve..

 

[tictic11]

i hope that u would be right........i am also waiting for market cool down...what is your thought about cheap rate option like under 10.....i have purchased a 2rs call of 3600 sell it at 9.it has touched 40+...

Can u tell me anyone who had even day dreamed that market will touch 3400 by the 1st week of april. This is stock market man..no one knows what will happen by the end of this series except god...
As far as dow we should not forget that dow is recovering from their 12 years low (even that is also 10-15% less than our recovery from recent lows)..however we are at very very much higher level than dow and their is atlest 20-30% space available to fill this gap..

rgds
Abhi

Edit: We can expect atleast 10% correction from these levels....i.e.2950-3000....we can predict only BAKI TO SIRF BHAGWAN HI JANTA HAI...KI 2800 JAYEGA YA 3800

 

[tictic11]

is there source where i could get historical price data/chart of call/and put

 

[ghosh_ak34]

Dear Ghosh Sir,
Its very kind of u to put down option trading strategies......I have a few queries
1. regarding buying in the money options as per your strategy, we generally have gap or gap down these days in nifty, thus if let say someday the resistance or support is broken on monday then how do we trade?
2. For all days of the week the previous week range holds for trading on all the days of the week?
3. How do we determine our stop loss levels ie. using NIFTY value and there by calculating the SL option price according to that or straightaway on options ?
E.g. - Bought 3300CE at 100 then my SL should be at 70-80 or I should fix my SL at Nifty - 30% of range (R-S) then calculate the price of option at tht nifty and fix my SL ?
Kindly resolve..

Dear Metushar,

1. regarding buying in the money options as per your strategy, we generally have gap or gap down these days in nifty, thus if let say someday the resistance or support is broken on monday then how do we trade?

Ans: If we have a gap up on Monday then, we will wait till 10:30 AM and will do a price check at 10:30 AM as per trend check strategy posted in 1st post of this thread. i.e. (Price at 10:30AM - Price at 10:00AM) > 20 then, will go long and hedge this by buying a in money put. Suppose we bought April Nifty future at 3430 then, we will hedge it by buying 3400 put. And will hold this setup i.e. (Nifty Long 3430 and 3400 put) with total SL= Rs 1000 or so depending on ones budget for the target of Rs 4000. One can square off there positions on daily basis.

If the Res. or support is broken then, we will long on Nifty (Res. broken ) and short on Nifty (Support Broken). But will definitely hedge our positions by buying in money options. We will not take any trade before 10:30 AM in any case. The broken supp. or res. should hold till 10:30 AM for sure for us to trade on it.

2. For all days of the week the previous week range holds for trading on all the days of the week?

Ans: For options trading as per strategy posted in 1st post we maintain weekly R1 & S1. When we take weekly R1 and S1 then, we never buy any futures. Daily Res. and Supp. are only for future traders who are reco. to hedge their postions by buying in money options.

3. How do we determine our stop loss levels ie. using NIFTY value and there by calculating the SL option price according to that or straightaway on options ?
E.g. - Bought 3300CE at 100 then my SL should be at 70-80 or I should fix my SL at Nifty - 30% of range (R-S) then calculate the price of option at tht nifty and fix my SL ?

Ans: Reco. to have SL =30% of ones option buy price. One can have their own SLs as per your budget and Risk taking capacity.

Regards

 

[Dev Mookerji]

Hi ghoshda,

Keman achen? Anek din pare apnar thread ta padchi.

keep rocking.
dev

 

[metushar]

thanku ghosh sir Active on saturday as well....
Daily Res. and Supp. are only for future traders who are reco. to hedge their postions by buying in money options.

I dont know how to calculate daily Resistance and support ? Kindly direct me to thread where u have given the formula....that will be enough.

cheers,
tushar

 

[ghosh_ak34]

thanku ghosh sir Active on saturday as well....
Daily Res. and Supp. are only for future traders who are reco. to hedge their postions by buying in money options.

I dont know how to calculate daily Resistance and support ? Kindly direct me to thread where u have given the formula....that will be enough.

cheers,
tushar

Dear Tushar,

I provide the daily res. and supp. levels for future traders based on TA and market movements. I am still to find a suitable formula for the same.

Regards

 

[raj_caps]

Buy nifty 3400 put market to touch 3121 in two days time... cover positions there...........