Nifty Options-Intraday Trading Strategy.

[tradingstudent]

Hi Trading Student,

Is using options viable as an intra day strategy?
The answer to your question is resounding "yes." Learn price action trading and i don't think understanding Option greeks and other theoretical concepts a must,but it is better to know theory, and rather than theory it is better to understand what we are planning to do...trading options whether it is intraday or on a larger timeframe is a different ball game ...what you are asking (2 to 3 points) is more akeen to scalping ...Learn price action trading....be in line with trend ...be fleet footed for options trading cut the losing position straight away.
All the Best:thumb:

Thanks Praveen for your listing out "price action" as another important concept for options.

 

[tradingstudent]

1st thing try to organize the all the information that you are getting across the net by categorizing them as you are trying to categorize your needs...


2nd
1. Knowing about the option strategies - just visit http://www.optiontradingpedia.com/strategy/optionstrategyselector.htm

2. Knowing about the option parameter, theta etc... - NOT NEED for intraday
3. Knowing about pricing models. - NOT NEED for intraday
4. Knowing about technical analysis. - try to keep it as simple as possible and get settle fast with some basic indicators as its very wast subject with never ending possibilities

3rd
1. The big question: What is the feasibility of options as a day trading medium?
ans- very very good
a. just know which strike price to select
b. spot the direction
c. be quick to exit (some on said scalping... may be right)
d. quantity depending on your risk taking & money management


4th
2. if one were to succed as an options day trader, what specific areas one should focus on and their priority level?
a. dont bet all you have at once
b. cut the losses fast
c. keep in mind that good exit would be with +10%
d. big exit would be 50% max
e. stop trading if you lose your daily stake " die an other day!! not today"


if you keep asking more questions about same basics then that sends a signal that you are expecting a spoon feeding which no one dose... try to start trading on papers and come up with you question on trading practically

all the best...

@toughard..

Thanks a bunch for taking the time to understand my needs and providing me a solution. You did a great job in structuring the aspects that i must go through and the bonus of trading tips is great..

I completely agree with you assessment and i intend to prepare well before taking it to the next level of paper trading..

Have a good one..

 

[toughard]

@toughard..

Thanks a bunch for taking the time to understand my needs and providing me a solution. You did a great job in structuring the aspects that i must go through and the bonus of trading tips is great..

I completely agree with you assessment and i intend to prepare well before taking it to the next level of paper trading..

Have a good one..

thanks buddy for taking it in right sense... how many have this attitude????:thumb:

 

[Options_Trader]

Suppose I have written a call of 6800. What would a normal option writer do if the market reaches 6800. Do they cover the position and write another higher call. Is this process called rollover?

If this is the general practice, strong trends will result in significant loss.

Please guide.

 

[toughard]

Suppose I have written a call of 6800. What would a normal option writer do if the market reaches 6800. Do they cover the position and write another higher call. Is this process called rollover?

If this is the general practice, strong trends will result in significant loss.

Please guide.

good question. to get answer for this question we have to understand the characteristics of ATM options, for that please see

http://www.traderji.com/options/93522-nifty-options-intraday-trading-strategy-3.html#post960752

 

[Options_Trader]

good question. to get answer for this question we have to understand the characteristics of ATM options, for that please see

http://www.traderji.com/options/93522-nifty-options-intraday-trading-strategy-3.html#post960752

Point is: say 6800 call was shorted for 70 rs. Now the call value is 100. I understand that time decay will compensate for small movements in nifty. But as I had mentioned earlier, in strong trends, time decay will not be able to compensate.

Was there something else you wanted to convey?

 

[toughard]

Point is: say 6800 call was shorted for 70 rs. Now the call value is 100. I understand that time decay will compensate for small movements in nifty. But as I had mentioned earlier, in strong trends, time decay will not be able to compensate.

Was there something else you wanted to convey?

this you have not mentioned earlier .... sorry I thought you shorted 6800 CE say around 200 or some thing and already in profit... and totally thought that you wanted to know what do with profitable trade... to hold it or close.... but here its different...

shadowing or rolling are same... this will happen by selling the losing trade with -30 and shorting again a lower strike where high premium can be captured... for all this having a clear/right view of trend is more important... again the legging option trades