So I hope you are very excited today because Mr. Ghanshyam is sitting here and today sir is going to teach you his favorite strategy to buy Bank Nifty options. So sir, today I am blank. He has not told me yet which strategy he is going to share.
Today my audience is here, there are many people who are beginners, who have never traded and may be new to options. So on their behalf, I will ask them the questions that may come in their mind. So, here you will give your setup, your strategy to the people and the questions that may come in your mind with the people, I will ask them. So, sir, share your strategy with the people. First of all, the simple way you know how to look at the chart to buy options, it will be as easy as buying options. Don’t make the chart more complicated.
I look at the chart purely, I don’t use any indicator on it.
I follow the basic calculation of price, candles, support, resistance, trend line, I follow these 4 or 5 things and I have been doing these 4 or 5 things for the last 8 years. So, maybe I have understood these things well, so I will tell you the same. Things that are very easy, if you are new then you will do 100-150 trades, you will do 100-150 trades on any setup, you will follow your rules, you will follow discipline, if you follow risk management and money management then you will definitely be profitable here. So, the first thing we will look at is the candle. My favorite candle is the hammer candle. I do a lot of trading with hammer candles. Hammer and shooting star for example, I use hammer for the buy side and shooting star for the sell side. So, here I am going to tell you how I use hammer candle. Because everyone knows hammer candle. It is not that you don’t know hammer candle, you will see a lot of videos about hammer candle. But I am going to tell you how I use it and in what situation I use it. So don’t leave hammer at all.
No, I will not leave hammer, it will be done on my setup. If hammer is done anywhere, I will not use it.
So you don’t want to know what you do in your setup. I will trade only when it is done in my condition. Hammer will be done all day, but it should be done in my condition.
This is the chart of the last day. I have put a 5-minute chart here.
Bank Nifty is very big.
The gap has just opened here. The chart is from Friday. And here, see, Bank Nifty is slowly going down. Now, if Bank Nifty has opened a gap of 400-500 points, then we will not buy. The simple theory is that we have no logic to buy here. So, what we will do is that we will have to wait for a setup. Now, obviously, when the market opens a very big gap, then at first, some profit booking happens here. Why will that profit taking happen?
Because the people who are lagging, those who have bought lagging, what they will do is wait for a little profit taking to happen here. Now, if someone must have bought here yesterday, that is, if someone must have bought here a day before, then what will he do then? What will that person do? When he gets such a big gap, then that person will make a profit-taking here.
Those who bought here, now they have 500-600 points here overnight.
Now, what will I do?
He will make a profit-taking. So we have to wait here. We do not make immediate trades here.
What does the retailer do? For example, if he thinks that the market is at 400-500 points or the Dow Jones is above 1200 points, then the market will perform very well today.
So what does he do? He enters immediately. And in buying options, you see, money will be made by buying options only if the momentum is maintained. If you do not have momentum, then it is very difficult to make profits. Because if the market stops at one place for one hour, then the option you have at 100 will automatically become 80. That 10 rupee premium will automatically disappear.
So, what we need to do is find momentum. Where can momentum be generated? So, here, see, the market opens here and after opening, the market slowly comes to the lower side. And see, here a hammer candle is formed. Now I follow two things, the hammer in two conditions.
So, first of all, you need to know the condition. Now, how will I follow this hammer when the gap is open and this hammer is below tomorrow’s clothing?
There are two different conditions to follow both. Now, what happened with this hammer? The market has opened above tomorrow’s clothing.
That is, the market is bullish. According to today, the market is bullish. Now the market is going down from here, but even after going down, it is a matter of tomorrow’s low, it has not even come close to tomorrow’s clothing. Okay.
Okay. So, what is it?
Here a small profit taking has occurred in the market.