Futurestrading
NQ is losing momentun and going redHello traders,
As you can see The Nasdaq is starting to lose momentum after being bullish for several days. This is because NQ came back from strong levels, the daily 20.790 and the weekly 20.296.
From a 1H chart point of view, the price made a beautiful pull back on the weekly getting strong momentum then was rejected downward looking for the next daily level of 19.973 giving us a beautiful short trade.
If price hit the daily level and gets rejected, look for a pullback then go long searching the next daily level 20.144. But if price breaks the daily 19.973, wait for a pull back then go short searching the next weekly 19.760.
Good luck everyone and Happy trading!
The $100,000 Bitcoin Chase: Can You Catch It?Hello traders,
It's been a while since BTC reach all time high $73000 spot. As you traders notice that price started making all those LH, HH and even LL making the market in a state of uncertainty.
In fact, the BTC market is accumulating a very strong momentum making ready to skyrocket at time especialy at this time when Gold is making superbe HH.
I am seeing Bitcoing nothing but going forward the golden spot $100000!
Keep a close eye on the market and never miss the great opportunity when it comes.
Good luck!
Breakout Watch: Trading Nikkei Futures Ahead of Its Micro Launch1. Introduction: Nikkei Futures and Current Market Setup
Nikkei Futures (NIY1!) remain a cornerstone of Japan's equity market exposure for traders globally, offering insights and trading opportunities tied to the performance of Japan’s stock market. In recent days, the Nikkei Futures market has entered a phase of tight consolidation, with the trading range narrowing between 39515 and 38785. This setup presents a classic breakout opportunity, with price poised to either break above the upper boundary or fall below the bottom one. Traders should remain vigilant, as a breakout could lead to a market movement in either direction.
2. Contract Specifications: Nikkei Futures vs. Micro Nikkei Futures
Nikkei Futures (NIY1!) are a valuable tool for traders seeking exposure to Japan’s economy. The contract size is tied to the Nikkei 225 index, with each tick movement having substantial financial implications for the trader. Here’s a breakdown of the key specifications:
o Nikkei Futures (NIY1!):
Tick Size: 5 points.
Tick Value: 2,500 JPY per tick.
Margin: 1,500,000 JPY (varies as market conditions change)
Starting October 28, 2024, CME Group will introduce Micro Nikkei Futures, which will provide a more accessible option for retail traders by offering a smaller contract size and lower margin requirements. The Micro Nikkei contracts will allow traders to take advantage of the same market exposure with greater flexibility and reduced capital risk:
o Micro Nikkei Futures:
Tick Size: 5 points.
Tick Value: 250 JPY per tick.
Margin: 150,000 JPY (varies as market conditions change)
This introduction opens up new opportunities for traders looking to manage risk more effectively or for those who prefer to trade with smaller position sizes.
3. Breakout Trade Setup for Nikkei Futures
Currently, Nikkei Futures are stuck in a range-bound market, oscillating between 39515 and 38785. A potential breakout beyond these levels is potentially imminent, and traders can prepare to capture the momentum once it occurs.
The key to this setup is patience: wait for the price to either break above or fall below before entering any trades. Here’s the breakout strategy we’ll be focusing on:
Breakout to the Upside: Enter a buy trade if price breaks above 39515.
Breakout to the Downside: Enter a sell trade if price falls below 38785.
By leveraging this breakout strategy, traders can capture the volatility that usually follows a breakout from a tightly held range.
4. Breakout to the Upside: Trade Idea
In the event of an upside breakout, we anticipate that the price will rally after breaking through the 39515 level. Here’s the breakdown for this trade setup:
Entry: Buy at 39515, the upper boundary of the current range.
Target: The target is set at 40285, where there is a significant UFO resistance and a technical resistance level. This level marks a strong area where sellers may come in, making it a logical point to exit the trade and secure profits.
Stop Loss: To manage risk, place the stop loss a third of the profit zone below the entry price. In this case, the stop would be at 39258, minimizing downside exposure while allowing the trade to develop.
o Risk/Reward Calculation:
Profit zone: 40285 - 39515 = 770 points.
Risk (1/3 of the profit zone): 770 / 3 = 257 points.
Stop loss: 39515 - 257 = 39258.
For standard Nikkei Futures, each point is worth 500 JPY, so:
Potential profit: 770 points × 500 JPY = 385,000 JPY (approx. USD 2,580).
Risk: 257 points × 500 JPY = 128,500 JPY (approx. USD 860).
For the Micro Nikkei Futures, everything would be reduced x10 (approx. USD 258 and USD 86).
5. Breakout to the Downside: Trade Idea
In the case of a downside breakout, we expect a decline once the 38785 level is breached. Here’s how the trade setup would work:
Entry: Sell at 38785, the lower boundary of the current range.
Target: Set the target at 37920, a level supported by a UFO support, a technical support, and two nested Fibonacci retracement levels (23.6% and 61.8%).
Stop Loss: The stop loss is set at a third of the profit zone above the entry price. This protects against excessive losses if the market moves against the trade. The stop would be at 39073.
For standard Nikkei Futures:
Potential profit: 865 points × 500 JPY = 432,500 JPY (approx. USD 2,910).
Risk: 288 points × 500 JPY = 144,000 JPY (approx. USD 970).
For the Micro Nikkei Futures, everything would be reduced x10 (approx. USD 291 and USD 97).
6. Risk Management
Effective risk management is key to long-term success in trading. In both breakout scenarios, the use of stop-loss orders ensures that traders can limit their losses if the market moves against them. Additionally, setting precise entry and exit points reduces the likelihood of emotional decision-making, allowing for more disciplined trading.
The upcoming launch of Micro Nikkei Futures offers traders enhanced control over their position sizing and risk exposure. With smaller contracts, traders can engage in these setups with a fraction of the capital required for standard futures contracts. This flexibility is particularly beneficial for retail traders looking to manage risk effectively while still capitalizing on market opportunities.
Whether you are a seasoned futures trader or new to the Nikkei market, these breakout setups provide a solid foundation for capturing momentum. As always, risk management should remain at the forefront of your strategy, ensuring you protect your capital while pursuing profits.
When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com - This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies.
General Disclaimer:
The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
EOS bearish pattren formed in 4hr time frame as you see the EOS breaks previous support and now its trading below the 200 ema and 100 ema and price is at 4hr fib level there is high probability that price again reject from its supply area and retest the demand zone 0.4600
pattern type :- bearish rising wedge
trade type :- short
entry :-0.5411
sl :- 0.5670
traget:- 0.4590
CRUDE OIL (WTI): Short-Term Bearish Sentiment
Crude Oil looks bearish after a breakout of a key daily horizontal support.
The next key supports are 68.5 - 69.2 and 66.4 - 67.4.
The price will most likely continue falling, at least to the first support.
❤️Please, support my work with like, thank you!❤️
GOATSEUS MAXIMUS IS MEMECOIN OF THE YEAR! TRADE PLAN + ANALYSIS 🚀 THE MEMECOIN OF THE YEAR! 🚀
GOATSEUS MAXIMUS is set to dominate the upcoming bull run with its bullish technical pattern and growing hype! It’s positioned to be the No. 1 MEME COIN with the highest potential for insane gains! 🌕 Falling wedge breakout imminent, and with the strong social backing of this community-driven project, we're looking at the next potential 100x gem.
With massive social engagement, an active community, and favorable technicals, this is THE MEMECOIN to keep on your radar for exponential growth!
Chart Overview:
Current Price: $0.11310 (as shown in the image)
Volume: 53.78K, indicating a moderate trading activity.
Formation: A Falling Wedge pattern is clearly visible, which is a bullish reversal signal. A falling wedge typically indicates a strong potential for a breakout to the upside as the price consolidates within narrowing bounds.
Indicators:
VMC Cipher B: Showing divergence signals, and while the indicator line has been in negative territory, we can see signs of momentum gradually shifting back into positive.
Blue Wave suggests weakening bearish momentum, and with this setup, an upside breakout seems likely.
RSI (Relative Strength Index): RSI is at 52.23, which is neutral. This implies there is room for further price movement without entering overbought territory, aligning with the possibility of a breakout.
Stochastic RSI: At 10.85 (oversold levels), suggesting strong upside potential. When both the RSI and Stochastic RSI are in neutral and oversold conditions respectively, this typically signals an imminent rally.
HMA (Hull Moving Average): The histogram shows the start of positive momentum, which indicates a potential shift in trend to the upside.
Key Technical Levels:
Resistance Levels:
Immediate resistance at $0.11485, the recent high.
Secondary resistance at $0.125 and $0.150 in the event of a strong breakout.
Support Levels:
Immediate support at $0.10557, the most recent low.
Stronger support at $0.10000.
Trading Plan
Entry:
Look to enter a long position at the breakout from the falling wedge pattern. Confirmation of the breakout should be around $0.1150–$0.1160.
For a more conservative entry, wait for the price to break and close above the $0.1250 resistance level with confirmation from volume.
Stop-Loss:
Set a stop-loss below the wedge's support line, ideally around $0.1050. This gives room for natural volatility but avoids significant downside risk.
P rofit Targets:
Target 1: $0.1500 (short-term resistance).
Target 2: $0.2000 (medium-term target, given the potential for a strong rally as indicated by the technical setup).
Target 3: $0.2500 or higher for long-term holders, as the meme coin hype continues to drive potential exponential gains.
Bitcoin is going up, short consolidation phase TA+TRADE PLANBitcoin's price action against USDT on a 1-hour timeframe with several technical indicators and key levels. Here is my technical analysis + trade plan by Blaž Fabjan
Ascending & Descending Trading Channels:
The price is moving between ascending and descending channels. This can indicate phases of higher highs and higher lows (ascending) followed by lower highs and lower lows (descending), which often signals periods of short-term consolidation or corrections.
Resistance Levels:
Multiple resistances are clearly marked on the chart around the price of $68,556.87 and $67,000. The price has struggled to break above these levels multiple times, making it a critical zone to watch for future price action.
Support Levels:
Support is visible around $61,758.48 and $60,301.68, representing strong areas where the price previously rebounded. These levels are essential for managing downside risk.
Consolidation Phase:
The price appears to be consolidating after rejecting the upper resistance line. This phase suggests market indecision or preparation for a breakout.
VMC Cipher_B Divergences:
Divergences in this indicator show potential weakening of the bullish trend, which could signal a pullback. The green and red dots suggest possible points of reversal, important for catching trend changes.
RSI (Relative Strength Index):
RSI is at 52.96, indicating the market is neutral but slightly leaning toward the bullish side. If RSI breaks above 70, this could signal overbought conditions, while a drop below 30 would indicate oversold.
Stochastic Oscillator:
Currently in the oversold region (18.22), indicating a possible upward reversal soon. This could hint at a short-term bullish move.
HMA (Hull Moving Average) Histogram:
The HMA is showing a mixed trend, but the upward slope hints at mild bullish momentum that needs confirmation from price action or volume spikes.
Trading Plan
Entry Points:
Long Position: Look for a breakout above $67,000 or $68,556.87, especially with strong volume confirming the upward move. You could set a buy stop order slightly above these levels to capture the momentum.
Short Position: If the price rejects resistance and breaks below $64,500 (the recent low), this could indicate a further decline toward support levels around $61,758.48 or lower.
Stop-Loss:
For long trades, place stop-losses just below $64,500 to minimize risk in case of a fake breakout or false bullish signal.
For short trades, place stop-losses above $67,000, as a break above this could invalidate the bearish trend.
Profit Targets:
Upside Targets: First target is around $70,000 (a psychological round number and historical resistance), followed by $71,000.
Downside Targets: The initial target for a short would be $61,758.48. A break below could see prices test $60,301.68, the lower boundary of this channel.
Risk-Reward Ratio:
Ensure that any trade maintains a risk-reward ratio of at least 1:2. For instance, if you risk $1,000, you should aim for a reward of $2,000.
Additional Confirmation:
Wait for additional signals, such as volume spikes or confirmation from indicators like RSI or Stochastic, before entering a position. The market could continue to consolidate before choosing a direction.
Time Horizon:
Given that this is an hourly chart, these trades are more suited for short-term to medium-term traders. Ensure to adjust your stops and targets as the market evolves, and check for any upcoming fundamental events (like economic news or regulatory updates) that could impact Bitcoin's price.
By following this plan, you can manage your trades effectively, balancing risk and reward while being prepared for both bullish and bearish scenarios.
BITCOIN IS GOING UP! TA + TRADE PLAN BY BFTechnical Analysis of Bitcoin (BTC) on the Chart by Blaž Fabjan
Falling Wedge Continuation Pattern
The falling wedge is a bullish continuation pattern, often indicating a potential upward breakout after a period of consolidation.
Resistance and Support Lines:
The chart shows a clear resistance line sloping downward and a support line also trending downward.
The price is approaching the apex of the wedge, where a breakout is likely imminent.
Indicators Analysis:
VMC Cipher B (Market Cipher Indicator):
The divergences on the VMC Cipher B show a series of green dots, which are often used to indicate potential long entry points.
The momentum appears to be turning positive, with the indicator suggesting possible bullish divergence.
RSI (Relative Strength Index):
The current RSI is at 39.81, which indicates a moderately oversold condition.
An RSI below 40 often suggests that the market is near the bottom, and a potential reversal to the upside is likely.
Stochastic Oscillator:
The Stochastic Oscillator shows 43.44 and 47.50 (K and D lines), hovering near the oversold region but not yet fully bottomed out.
A crossover or upward movement from these levels would provide additional confirmation of a bullish reversal.
HMA+ Histogram:
The HMA (Hull Moving Average) histogram shows recent red bars, indicating negative momentum, but it appears to be narrowing, suggesting that the selling pressure is weakening.
A transition from red to green bars would confirm a shift toward bullish momentum.
Potential Breakout Scenario:
Given the falling wedge pattern and the technical indicators approaching oversold conditions, there is a strong likelihood of a bullish breakout.
The volume is not provided in the chart, but price action suggests decreasing volatility before a potential breakout.
The breakout direction is likely to be upwards, targeting the $65,000 to $67,500 resistance zone initially.
Trading Plan by Blaž Fabjan:
Entry Strategy:
Wait for Confirmation of Breakout: Enter a long position once the price breaks above the resistance of the falling wedge pattern (around $61,500-$62,000).
RSI needs to cross above 45 to confirm momentum is shifting to the upside.
Ensure that the VMC Cipher B shows green dots and the Stochastic Oscillator shows a bullish crossover before entering the trade.
Stop-Loss Strategy:
Place a stop-loss just below the support line of the wedge, which would be approximately around $59,000, to protect against a false breakout or further downside.
Profit Targets:
First Profit Target: $65,000 (previous swing high and a significant psychological level).
Second Profit Target: $67,500 (the next key resistance level after the breakout).
Risk-Reward Ratio:
Aim for a minimum 2:1 risk-to-reward ratio.
For an entry near $62,000 with a stop loss at $59,000, the first target at $65,000 gives a decent risk-to-reward ratio, with the potential for higher gains if the price continues to climb.
Trade Management:
Trailing Stop: Once the price reaches the first target, move the stop-loss to breakeven (entry point) to lock in profits and manage risk.
Monitor the RSI and VMC Cipher for signs of exhaustion in momentum once the price nears the second target.
Alternative Scenario:
If the price fails to break above the wedge and breaks below the support line, consider reversing the position or waiting for further confirmation of a bearish trend before shorting.
By following my plan, traders can capitalize on the potential upward breakout from this falling wedge continuation pattern while managing their risk effectively.
COTI will be bull?after seeing the price movement of this coti it makes me interested because it managed to create a new structure, where it penetrated the previous high low which will indicate a sign of a price reversal, and we believe the price will show an increase to the green line that we have marked.
*disclaimer
QTUMUSDT BULL?this pair on 1h time frame was break a structur of hight and now this price stil a make correction, potential buy on the deep its can happen cause we look before the price make its the same. im believe the price can break the high and if this price break potential to green line its coming.
*disc On
3 Standard Deviation Setup on Micro 10-Year Yield FuturesIntroduction
The Micro 10-Year Yield Futures contract has caught the attention of many traders recently, as its price action reached the upper 3 standard deviation of the Bollinger Band® in the daily time frame. This rare occurrence presents a potential mean reversion setup, where the price could revert back toward its historical average.
This article explores what mean reversion is, why it matters in trading, and how the 3 standard deviation Bollinger Bands® setup may indicate an opportunity to short this market. We’ll also discuss key price levels, contract specifications, and a potential trade setup for shorting Micro 10-Year Yield Futures.
What is Mean Reversion in Trading?
Mean reversion is a trading concept based on the idea that asset prices fluctuate around a central value or mean over time. When prices move too far away from this mean, they often correct or revert back toward that average. This is particularly useful in markets that experience high volatility or extreme price movements, as those extremes tend to reverse at some point.
In simple terms, mean reversion strategies involve selling (or shorting) assets when they are significantly above their historical average, with the expectation that prices will return to normal levels. Conversely, buying when prices are significantly below the mean can also be a valid strategy.
The 3 Standard Deviation Bollinger Band® Setup
Bollinger Bands® are a popular technical indicator used to measure volatility and price extremes. The bands are plotted a certain number of standard deviations away from a moving average. The further away prices move from the average, the more extreme the movement.
Reaching the upper 3 standard deviation Bollinger Band® is a rare occurrence that suggests extreme overbought conditions. Historically, when an asset reaches this level, the likelihood of a price pullback increases, as market participants may see it as an unsustainable level. In the case of Micro 10-Year Yield Futures, the recent rally has pushed prices to this rare zone, setting the scene for a potential mean reversion.
Key Price Levels and Resistance Zones
As the Micro 10-Year Yield Futures price approaches extreme levels, there are two key resistance zones which traders should be aware of: 4.174-4.021. These levels represent areas where selling pressure might intensify, pushing prices down and aiding in the mean reversion process.
Traders looking to capitalize on this potential mean reversion setup can consider initiating short positions within this resistance range. These resistance zones act as psychological and technical barriers, providing an opportunity for traders to place their entries. Additionally, these levels help to manage risk, as they define a clear area to set stop-loss orders just above the upper resistance.
Contract Specifications and Margin Requirements
Understanding the specifications of the Micro 10-Year Yield Futures contract is crucial for traders looking to execute any trade. Here are some of the key details:
Tick Size: The minimum price fluctuation is 0.001, which equates to $1 per tick.
Margin Requirements: Margin requirements vary. Currently, the initial margin for Micro Yield Futures is around $320 per contract, making it accessible to a wide range of traders. Check with your broker for specific margin amounts.
This knowledge is essential in calculating potential profit and loss in dollar terms, as well as determining the appropriate position size based on your available margin.
Trade Setup Example
Let’s now move on to a practical trade setup based on the discussed conditions.
Entry Point: Shorting Micro 10-Year Yield Futures within the resistance range between 4.174 and 4.021.
Stop Loss: A stop should be placed just above the upper resistance, say around 4.175, to protect against further price appreciation.
Target: The target for this mean reversion trade would be around the mean of 3.750, where prices are expected to revert based on historical behavior.
Reward-to-Risk Calculation:
If a short entry is made at 4.021, with a stop at 4.175 (154 basis points risk) and a target at 3.750 (271 ticks potential gain), the reward-to-risk ratio would be approximately 1.76:1. A higher entry point closer to the upper resistance at 4.174 would significantly improve the reward-to-risk ratio, but it also increases the likelihood of missing the entry if the market reverses before reaching that level.
In dollar terms, each tick (0.001) is worth $1, so the 154-tick stop loss represents a risk of $154 loss per contract, while the potential reward of 271 ticks equates to $271 worth of gains per contract.
Risk Management Considerations
Risk management is a critical aspect of any trading strategy, especially in futures trading. While the 3 standard deviation Bollinger Band® setup provides a compelling case for mean reversion, it's essential to manage risk carefully to avoid significant losses.
Stop-Loss Orders: A well-placed stop-loss is crucial to protect against unexpected market moves. In this case, placing the stop above the resistance zone (around 4.175) ensures that risk is controlled if the market continues to rally instead of reversing.
Position Sizing: Given the volatility of futures contracts, it is important to adjust position sizes according to the trader’s risk tolerance and available margin. Overleveraging can lead to large losses if the market moves against the trade.
Moving Averages Can Shift: It’s important to remember that the moving average (the mean) can change as new data comes in. While the target is currently around 3.744, this level may adjust over time, so traders need to monitor the mean as the trade progresses (which is why we have set the target to initially be slightly higher at 3.750).
Resistances as Reinforcements: The resistance zone between 4.174 and 4.021 can act as reinforcements to the mean reversion. Traders should observe price behavior at these levels to confirm rejection signals before entering the trade.
Conclusion
In conclusion, the Micro 10-Year Yield Futures contract presents a unique trading opportunity as it has reached the rare 3 standard deviation Bollinger Band® on the daily time frame. This extreme price level indicates potential overbought conditions, making it a candidate for mean reversion back to the mean at approximately 3.750.
The trade setup involves shorting within the resistance range, with a well-defined stop and target, and offers a favorable reward-to-risk ratio. However, as always, caution is advised, and traders should manage risk effectively using stop-loss orders and appropriate position sizing.
When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com - This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies.
General Disclaimer:
The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
GIFT Nifty 50 Index Futures AnalysisThe chart of GIFT Nifty 50 Index Futures shows a well-established upward trend, with the price action respecting key Fibonacci retracement levels. Here’s a professional analysis:
Key Support and Resistance Levels:
Resistance:
The index is nearing the 0.00% Fibonacci level at 27,316.5, which could serve as an immediate resistance zone. A break above this level may lead to further bullish momentum.
Support:
The nearest support is at the 23.60% retracement level (25,883.5) , which coincides with the recent pullback. If this level breaks, the next significant support lies around the 38.20% retracement level at 24,997.0.
50.00% retracement level (24,280.5) marks another key support level that has historical significance based on past price action.
Stronger support is found at the 61.80% retracement level (23,564.0) , which could potentially act as a long-term pullback zone if the index experiences a deeper correction.
Trend Analysis:
The chart is trending within an ascending channel, suggesting ongoing bullish momentum. However, the index has recently seen a pullback after reaching higher levels. The confluence of Fibonacci levels suggests that any decline towards 25,883.5 could be a healthy correction within the trend, potentially providing a good buying opportunity.
Pullback Zones:
The 25,883.5 level (23.60%) will be the first area to watch for a pullback. A break below this level might signal a more extended retracement to the 24,997.0 (38.20%) or 24,280.5 (50.00%) levels.
If the selling pressure intensifies, the 61.80% level at 23,564.0 becomes a critical zone for reversal or accumulation.
RSI and Volume:
The RSI is in the overbought territory, signaling that a pullback may be imminent. This could indicate that the index needs to cool off before continuing its uptrend.
Volume shows increasing activity, which supports the current trend, though declining volume during the recent upward move could hint at weakening buying pressure.
Conclusion:
Overall, the GIFT Nifty 50 Index Futures remain in an uptrend, but caution is warranted due to the overbought RSI and proximity to key resistance levels. Watching for potential pullbacks to the 23.60% and 38.20% retracement levels may provide favorable entry points for long-term bullish traders, while breaks below the 50.00% level could signal a deeper correction.
This neutral outlook focuses on price action, with both upside potential and correction zones clearly defined.
Part 1: Option Selling: A Simple Way to Earn Consistent PremiumsWe’ll explore the top 7 option-selling strategies on the NSE (National Stock Exchange) that could help traders target up to 10% monthly returns per Month on their capital. Option selling is an advanced strategy that can generate consistent income, but it’s important to balance high rewards with the right risk management. Whether you are new to options or an experienced trader, this guide will provide an overview of each strategy, rated based on its risk, reward, and suitability for achieving your financial goals.
Option Selling on NSE: A Simple Way to Earn Consistent Premiums
Introduction
Option selling is a great way to make steady income on the NSE. Instead of waiting for big market moves, you can sell options and collect premium upfront. It’s a strategy that benefits from time decay, meaning the longer the option sits without action, the more money you can make. Let’s break down why it works and why traders love it on the NSE.
What is Option Selling?
When you sell an option, you’re giving someone the right to buy or sell an asset at a specific price. In return, you get paid a premium upfront. As long as the market stays within a certain range, you keep that money.
Selling a Call : You profit if the price stays below a certain level.
Selling a Put : You profit if the price stays above a certain level.
It’s simple – the less the market moves, the more you earn.
Why Traders Choose Option Selling
1. Immediate Income
You get paid right away when you sell an option. No waiting for market moves, just steady income.
2. Time is Your Friend
As time passes, options lose value due to time decay. This works in your favor as a seller, since the option becomes less likely to be exercised.
3. High Win Rate
You don’t need big price moves. As long as the market stays within a range, you win.
4. Control Risk with Spreads
You can limit your risk by using spreads, where you buy another option to protect yourself if the market moves too much.
Why the NSE is Ideal for Option Selling:
High Liquidity: Options like Nifty and Bank Nifty have a lot of buyers and sellers, so trades are easy to make.Low Capital Requirement: You need less money to sell options on the NSE compared to other strategies.Risk Control: With the wide variety of options, you can set up trades that limit your risk.
Conclusion
Option selling on the NSE is a simple and effective way to generate steady income. By collecting premiums and managing risk with spreads, you can create a reliable strategy for consistent earnings. Whether you’re new to trading or experienced, option selling offers an accessible path to profit.
Platinum: Little Consolidation (Wave 4); Golden RatioWe can see a very well defined cycle, and wave 1 to 3 already created.
This new cycle could be a consolidation, the price can drop to 14,6% or 23,6% level.
Or even in the middle between 38,2% and 23,6%, where other wicks has already touched, creating a support, where can also occur the last candle of Wave 4.
Open interest in NYMEX:PL1! is falling and the major trend rising, it can occur a reverse, and this reverse will be the Wave 4.
RSI left the Overbought level, followed by a failure swing, resulting in continued decline of the indicator.
After the peak $1,016.45, ADX is losing strength while DMI+ has a high probability of changing position with DMI-.
Entry Types Simplified: The Essential Guide for New Traders!Key Structures and Formations:
Ascending Channel:
The price has been moving within this channel for a while. An ascending channel indicates an uptrend but also signals that the price is forming higher highs and higher lows, which can later break either direction.
Bull Flag:
A classic continuation pattern where after a strong bullish move (flagpole), the price consolidated before continuing upwards. This was a great entry point for traders watching for bullish momentum.
Failed Flag:
It appears there was a bull flag that failed to continue upwards and instead reversed direction. This type of failure is a strong indication for traders to reconsider their long positions or take partial profits. Often when a flag fails, it can lead to an aggressive move in the opposite direction.
Zones:
4HR, 1HR, 15M LQZ (Liquidity Zones):
These zones mark areas where liquidity is expected to be high, which means these are key levels to watch for price reactions.
The 4HR LQZ around 2,622 and the 1HR LQZ around 2,639 are critical areas for price retracement or reversals, particularly in a trending market.
Current Price Action:
The price is currently hovering near the 15M LQZ (2,655.443), which could act as a short-term support/resistance level. Watching how the price reacts to this zone will provide insight into the next move.
If the price continues to drop, the 1HR LQZ around 2,639 may provide support. If that fails, the next likely target is the 4HR LQZ near 2,622.
Recommendations Based on Confluence:
Check for Multi-Touch Confirmation: If the price interacts with the 4HR or 1HR LQZ zones multiple times and forms a base, this could serve as strong confirmation of a potential reversal or continuation.
Comprehensive Patterns: The failed flag within the larger ascending channel provides a great example of how smaller patterns (failed flag) can give clues about larger moves (channel break).
Follow the Trinity Rule: As per the Trinity Rule, wait for multiple confirmations across different structures before entering a trade. The liquidity zones and patterns within patterns provide a good basis for this.