NIFTY : Trading Levels and Plan for 10-Oct-2024

Nifty Trading Plan for 10-Oct-2024

Previous Day's Chart Pattern Recap
On the previous trading day, NIFTY performed exactly worked at levels that I have shared previously ultimately forming a range-bound structure. Despite some attempts to break out, the price movement remained sideways, with support holding near 24,971 and resistance near 25,090. The structure indicated indecision, setting the stage for a decisive move depending on how Nifty reacts to key levels in today's session. Let’s analyze possible opening scenarios for 10th October and plan accordingly.

Opening Scenarios

1. Gap Up Opening (+100 points or more):
   In case of a gap up, Nifty will likely open above the "No Trade Zone" and approach the resistance zone near 25,172–25,267. If the price holds this zone, there could be an upward extension towards 25,323 and 25,475. However, if the market shows weakness near 25,172, we could see a reversal or sideways movement.
   Trade Setup:
   - Buy near 25,172 with a stop loss just below 25,120.
   - First target: 25,267; Second target: 25,323.
   - Consider shorting if Nifty reverses from 25,267, with a target towards 25,090.
   
   
   
   
   
2. Flat Opening:
   A flat opening within the "No Trade Zone" (25,066–25,090) might lead to a choppy market initially. Traders should wait for a clear breakout or breakdown from this range. A breakout above 25,090 could push prices towards the higher resistance zones, while a breakdown below 25,066 would target the support zone near 24,954.
   Trade Setup:
   - Buy above 25,090, targeting 25,172 and 25,267.
   - If price breaks below 25,066, short with a target towards 24,954 and 24,900.
   - Wait for confirmation before entering, as false breakouts may occur within this range.
   
   
   
   
   
3. Gap Down Opening (-100 points or more):
   If Nifty opens with a gap down and approaches the "Opening Support" zone around 24,954–24,971, expect a possible bounce. A failure to hold this zone may lead to further declines towards 24,809 (Buyers' Re-Entry Zone). In case of continued selling, the next support level lies at 24,626.
   Trade Setup:
   - Buy near 24,971 if support holds, with a target of 25,066 and 25,090.
   - If Nifty fails to hold 24,954, short with a target towards 24,809 and 24,626.
   - Look for confirmation before entering trades near these key support levels, especially if the gap down is sharp.
   

Risk Management Tips for Options Traders:
- Avoid trading options during the first 15 minutes of the market open to let the volatility settle.
- Use defined stop losses, especially in gap scenarios. Use an hourly close for better confirmation.
- Choose options strike prices near the key levels mentioned. For instance, near 25,100, look for 25,100–25,200 strike prices for calls/puts depending on the direction.
- Stay cautious with overleveraging; trade only with capital you're willing to risk in volatile conditions.

Summary and Conclusion:
Today’s trading will revolve around how Nifty reacts to the key levels defined above, especially in the gap opening scenarios. A gap up will bring us closer to resistance, while a gap down will test the strength of buyers near the support levels. Stay patient, wait for price confirmation, and only take trades with a favorable risk-reward ratio.

Disclaimer:
I am not a SEBI registered analyst. The ideas shared here are for educational purposes. Please do your own analysis or consult a financial advisor before making any trading decisions.