@Hmp
Here a little update on the above setup with your idea:
After the moment I posted the above (as input for your thread) until closing of your market, here the numbers I have seen so far on the option matrix and on the chart:
The Jan 8200 call went up 40.50 points (168.30 to 206.80), the Jan 8200 put has lost 27 points (75.80 down to 48.80) and the Nifty future made a profit of 54.75 points during this time.
So this is an other prove that the setup will work very well and can be individually handled in different markets from where ever with different ideas.
Now being a bit more specific on the chart pattern and how I saw and defined it in this specific case. Let me tell you this for once, which I normally not will do, but I love your setup and the flexibility it offers to any option strategy traders:
In your Nifty chart you
had a small gap down from the 5 Jan to the 6 Jan 2015. On the 6 Jan you had a huge red candle. On the 7 Jan you had a neutral red candle which you can take as pivot point on the low and after this market started to move up even until today (12 Jan 2015)
Now why did I tell that I saw some how an ascending triangle occurring? I am clear this is out of the box looking at a chart. Is it forbidden? In no way and every trader should have out of the box ideas and ways to trade.
Now open any EOD Nifty chart/s on a bigger time frame like six month and three month and make your trend analyzes. After this open a chart with a period of two weeks or even ten days. Now take the huge red candle from 6 Jan 2015 as the first candle or starting candle in this out of the box case and forget for the moment the other candles. Then look at the following candles, starting from this huge red candle until today (12 Jan 2015). Now you will see the occurring ascending triangle, which was full ended on this little chart pattern with those little amount of few candles at end of today (12 Jan 2015).
Now this little picture by itself has not much value. But now you ad the rule to it
that most gaps will be closed and of a sudden you see an other value of those few candles and the market direction (up) and the chart pattern which occurred.
As you can trade this chart setup intraday with the eyes and rule I just mentioned, you take your trading setup and implement it enough early to be with the move, which probably could go on even tomorrow.
http://i59.tinypic.com/2ilnbsg.png
Next step would be to think over the MM and how to handle over night trades with your setup, how to invest new profits into new and other legs at which time and so on. But this would expand this post and has nothing to do directly with your trading setup and not even with a clear, fixed trading plan as first mentioned after we are in the trade. Here we would go again into topics which are out of the box as they are build on pure, individual traders ideas, coming up and implemented at the moment any situation is valued according to what we know and think would be nice to implement now. I not can explain this in words one by one, as it just comes when it has to come. But such trading is not needed to make any money in the market. A good trading setup and a simple clear trading plan will bring at any time some money.
Will not further disrupt your thread. As told: Just some input to it, as it is a nice setup which offers huge possibilities and that's it. Take care / Dan
Edit: Gap was closed today (13 Jan 2015) and market started to move down a while. Here the future trailing stop loss will keep this profit and the rest what you do with the option legs is your choice as there are a few.
