Trading Nifty Options based on 8 EMA plus minus

rh6996

Well-Known Member
#1
I was introduced to this strategy after the 8EMA thread was started. Initially was following it with 9DMA plus minus 0.3%

Now have moulded it to 8EMA plus minus 0.3%

The set up is simple :
On an EOD chart of Nifty draw 8 EMA and two lines above and below it at plus minus 0.3 and 0.9 percent !

Minimum 3 lots were traded. Or multiple as we wish to exit one third qty at 18 to 20% !

Giving a recent trade example :

on 22nd Sep 8 EMA was at 8102 and the nearest line below was at 8078 !
We look forward to taking a position in PE 8100 on breach of 8078 ! However if NF did not breach 8078 but is closing below 8DMA we take a position in 8100 PE
When we are near a figure of fifty or hundred we round off the entry level above below the same ! If we get an entry level at say 8097, we enter long only on cross of 8100 ! It is observed that 50/100 figures act as good S&R zones.

In this case on 23rd Sep I took 3 lots of 8100 PE at 58.85 and exited 1 lot the same day at 68 !
On 24th price crossed 116, i.e. double our entry level, hence exited 1 more lot at 116/-
On 25th exited the last lot at 148 ! Maybe intraday one can trail the SL to gain a bit more !
Gained approx 150 points !

For 30 Sep 2014
Now out of trade, the 8EMA is at 8025 and entry level is at 8049. We shall enter 8100 CE if NF crosses 8051 or todays close is above 8025 !
 

sabhlok_r

Well-Known Member
#2
I was introduced to this strategy after the 8EMA thread was started. Initially was following it with 9DMA plus minus 0.3%

Now have moulded it to 8EMA plus minus 0.3%

The set up is simple :
On an EOD chart of Nifty draw 8 EMA and two lines above and below it at plus minus 0.3 and 0.9 percent !

Minimum 3 lots were traded. Or multiple as we wish to exit one third qty at 18 to 20% !

Giving a recent trade example :

on 22nd Sep 8 EMA was at 8102 and the nearest line below was at 8078 !
We look forward to taking a position in PE 8100 on breach of 8078 ! However if NF did not breach 8078 but is closing below 8DMA we take a position in 8100 PE
When we are near a figure of fifty or hundred we round off the entry level above below the same ! If we get an entry level at say 8097, we enter long only on cross of 8100 ! It is observed that 50/100 figures act as good S&R zones.

In this case on 23rd Sep I took 3 lots of 8100 PE at 58.85 and exited 1 lot the same day at 68 !
On 24th price crossed 116, i.e. double our entry level, hence exited 1 more lot at 116/-
On 25th exited the last lot at 148 ! Maybe intraday one can trail the SL to gain a bit more !
Gained approx 150 points !

For 30 Sep 2014
Now out of trade, the 8EMA is at 8025 and entry level is at 8049. We shall enter 8100 CE if NF crosses 8051 or todays close is above 8025 !
One question. Do we take nifty spot or future levels?
For nifty spot the 8EMA value on my chart is 8032.33 for 29 sept EOD.
Am I missing something?
 

rh6996

Well-Known Member
#4
As I have just started using this strategy, it needs a lot of fine tuning and request your views.
One thing I realised is that getting a 18 to 20% return when you enter a option at ~150 to 200 level may be difficult.... though we are entering in the money options but still.... do we need to change it to amount basis in place of percentage !
 

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