Trading Plan for Bank Nifty - 30-Dec-2024
Intro: Review of Previous Plan (27-Dec-2024)
In the last trading plan, we emphasized the importance of the No Trade Zone (51,259–51,343), Opening Resistance (51,569), and Opening Support at 51,096. The market respected the highlighted zones, consolidating within the Yellow sideways trend for most of the session. A late-session attempt to test the Resistance for sideways at 51,958 faced rejection, aligning with our bearish expectations.
Key Color Codes in the Plan:
Yellow Trend: Sideways
Green Trend: Bullish
Red Trend: Bearish
Trading Plan for 30-Dec-2024:
Risk Management Tips for Options Trading:
Use spreads (e.g., bull call spreads or bear put spreads) to cap losses in high volatility conditions.
Avoid trading out-of-the-money options as they decay rapidly, especially during sideways trends.
Trade with no more than 2% of your total capital per position.
Monitor the market for IV changes, especially during gap openings, to adjust your option strategy.
Summary and Conclusion:
The plan is designed to capture potential breakouts and breakdowns while maintaining discipline in No Trade Zones.
Focus on the identified key levels to avoid overtrading.
Stick to defined stop-loss levels and maintain a favorable risk-reward ratio in all trades.
Disclaimer:
I am not a SEBI-registered analyst. All views are for educational purposes only. Traders are advised to do their analysis or consult with a financial advisor before making trading decisions.
Intro: Review of Previous Plan (27-Dec-2024)
In the last trading plan, we emphasized the importance of the No Trade Zone (51,259–51,343), Opening Resistance (51,569), and Opening Support at 51,096. The market respected the highlighted zones, consolidating within the Yellow sideways trend for most of the session. A late-session attempt to test the Resistance for sideways at 51,958 faced rejection, aligning with our bearish expectations.
Key Color Codes in the Plan:
Yellow Trend: Sideways
Green Trend: Bullish
Red Trend: Bearish
Trading Plan for 30-Dec-2024:
- Scenario 1: Gap-Up Opening (200+ points above 51,550)
If Bank Nifty opens above 51,550, the market could enter a bullish trajectory targeting the Resistance for sideways at 51,958–52,070.
Wait for a retest of the Opening Resistance zone (51,569).
If the zone holds and the price shows a bullish breakout with volume, initiate a long trade targeting 52,070.
Place a stop-loss below 51,450 to manage risk.
If resistance is not broken, observe rejection patterns like bearish engulfing candles, and consider a short trade with a target of 51,343. - Scenario 2: Flat Opening (51,250–51,350)
A flat opening signals consolidation around the No Trade Zone (51,259–51,343).
Avoid aggressive trades within this zone. Wait for a decisive breakout or breakdown.
A breakout above 51,343 signals bullish momentum towards 51,569. Look for confirmation via candle closing above the breakout level before entering long positions.
Conversely, a breakdown below 51,259 could lead to a test of the Opening Support at 51,096. Initiate a short position if the breakdown holds, with a stop-loss above 51,350. - Scenario 3: Gap-Down Opening (200+ points below 51,050)
A gap-down below 51,050 may indicate strong bearish sentiment, testing the Opening Buyers Zone at 50,664.
Observe for reversal patterns (e.g., bullish engulfing or hammer candles) at 50,664. If confirmed, initiate a long trade targeting 51,096.
If the support breaks, prepare for extended bearish moves towards 50,400. Enter short trades on confirmation with a stop-loss above 50,750.
Risk Management Tips for Options Trading:
Use spreads (e.g., bull call spreads or bear put spreads) to cap losses in high volatility conditions.
Avoid trading out-of-the-money options as they decay rapidly, especially during sideways trends.
Trade with no more than 2% of your total capital per position.
Monitor the market for IV changes, especially during gap openings, to adjust your option strategy.
Summary and Conclusion:
The plan is designed to capture potential breakouts and breakdowns while maintaining discipline in No Trade Zones.
Focus on the identified key levels to avoid overtrading.
Stick to defined stop-loss levels and maintain a favorable risk-reward ratio in all trades.
Disclaimer:
I am not a SEBI-registered analyst. All views are for educational purposes only. Traders are advised to do their analysis or consult with a financial advisor before making trading decisions.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.