NIFTY Options Trading by RAJ

[healthraj]

What will Happen After Feb 2017 Budget ?

Will it be a MAJOR UP MOVE or DOWN MOVE ?
Make your Guess

The RED Line indicates the MAJOR Support which has been holding on from 2009. IF it holds we can see Further UP moves otherwise we can soon see 6000 in another few months.

This is the Weekly chart for NIFTY SPOT

 

[travi]

Raj Bhai, I think the trendline is stretched from too far in time, so b/w 2009 and now a lot would have changed.
Lets see over 6 months period

 

[healthraj]

US DOW Jones Monthly Chart.

I think something BIG is going to happen. DOW Jones is trading near the life term High. At least in NIFTY Bears had some share of profit. But in US, only BULLS make profit. BEARS get opportunity rarely. But if they get they will take control of the market.

 

[Option.Trader]

What will Happen After Feb 2017 Budget ?

Will it be a MAJOR UP MOVE or DOWN MOVE ?
Make your Guess

The RED Line indicates the MAJOR Support which has been holding on from 2009. IF it holds we can see Further UP moves otherwise we can soon see 6000 in another few months.

This is the Weekly chart for NIFTY SPOT

Considering a swing.. how would you play the pairs? Would you buy now and sell on Budget day to latch on to IV deteriorating

 

[travi]

(IV) Vola already pumped up in 35-38% ranges.

 

[healthraj]

Considering a swing.. how would you play the pairs? Would you buy now and sell on Budget day to latch on to IV deteriorating

Market is yet to decide the Direction and will utilize the budget for the same. During the PRE-budget the VOLT normally goes UP and the two days following the budget the VOLT will come down and will take a direction.

So one Can sell the MAX OI pair now on today or tomorrow, which is at 8400-9000. My guess is that Market will make another 120 points on the UP side say 8800, will shed the VOLT and then will move DOWN.

 

[Option.Trader]

Market is yet to decide the Direction and will utilize the budget for the same. During the PRE-budget the VOLT normally goes UP and the two days following the budget the VOLT will come down and will take a direction.

So one Can sell the MAX OI pair now on today or tomorrow, which is at 8400-9000. My guess is that Market will make another 120 points on the UP side say 8800, will shed the VOLT and then will move DOWN.

If we are considering a 120 point swing, wouldnt it be beneficial to buy both ITM options 8600CE/PE now and sell on Budget day after Rally? a 120 Point swing should atleast give you a 70 point profit in a single day.. whereas selling will give you the same amount of profit only if it expires within in 3 weeks.
On the same day, at the max, it'll balance each other out or be in a loss if market tanks.. so considering RR and only for Budget day events, wouldnt Straddle be more effective?

 

[travi]

If your are considering short strangle with wide range like Raj bhai suggested, then it could've been done today, earlier the better.
Short straddle can hurt more on actual day.

For long, better to initiate after market open, as the opening itself may not gap heavily.
I think for quick moves, long straddle is better than long strangle.

 

[Option.Trader]

If your are considering short strangle with wide range like Raj bhai suggested, then it could've been done today, earlier the better.
Short straddle can hurt more on actual day.

For long, better to initiate after market open, as the opening itself may not gap heavily.
I think for quick moves, long straddle is better than long strangle.

I agree.. Long Stradle is ideal... writing is a bit risky as on a runaway rally at the either end, you will stand to gain nothing or be in a loss... Only if expectations are already built in and its deemed to fizzle out , is it ideal. I think its gonna be a binary event... either market is happy or not. If its happy, it can reach the next resistance at 8868 if not, it can reach 8280 and further down... so a good range to buy straddle

 

[travi]

I agree.. Long Stradle is ideal... writing is a bit risky as on a runaway rally at the either end, you will stand to gain nothing or be in a loss... Only if expectations are already built in and its deemed to fizzle out , is it ideal. I think its gonna be a binary event... either market is happy or not. If its happy, it can reach the next resistance at 8868 if not, it can reach 8280 and further down... so a good range to buy straddle

All budgets are different but just to draw inferences of a shakedown, last years budget open and close was almost Flat

Only day high/low extreme vola, another eg. like Trump Day.
Net day close not huge so we should look forward to that type as a possiblity.
Maybe even take a long straddle and put SL at 50pts (100 pts NF*delta) and let the other leg run with TSL then exit.