We have started taking a bullish position on ITC aiming at the results tomorrow. Trade is through an options strategy with zero or minimal loss and large profits if correct. Would you like to see the trade ?
OK, here is the position. Be aware that we are already in the position and are running at a small profit
Sell 1*210CE and buy 2*222.5CE June
Call Backspread
Price stays same, IV falls 5% post results
We are wrong and price falls 5% and IV falls 5%
Price goes up 5% and IV falls 5%
IV stays same price goes up 5%
IV goes up 5% and price goes up 5%
Be aware that we can at best make a guess at the results ( which we are making from data analysis). We can be wrong and are ready to bear the loss, so follow us if you understand the same. I seriously don't want idiotic " he he, you were wrong" comments post results
The question is not of right or wrong , I can be 50% of the time or more wrong on the results. The question is how much I lose when wrong and how much I win when right. This trade has a risk-reward ratio of 1:2 to 1:4 depending on how ITC performs
As usual, I have my skin in the game. Aim to increase positions till closing tomorrow based upon certain conditions. Assume 150% of the max loss shown per lot in worst case scenario and use position mgmt
I strongly suggest one goes thru the zerodha notes and play with any option payoff graph to understand. I have used opstra.definedge.com .
Keep the days at T+2
position at closing
• • •
Missing some Tweet in this thread? You can try to
force a refresh
Will show Nifty and BankNifty charts, best if one sees on a laptop/computer screen to see the layout. Mobile apps seems to show only one chart. Change background to black to see the SL lines.
Options Analyser analyses the whole option chain and shows Bullish or Bearish. Deep blue bars hitting > 96 is strongly bullish. Deep red bars <-96 are strongly bearish.
Value above 68 bullish , below -68 bearish.
Values between -68 and 68 are neutral/congestion .
Buy or Sell signals gets generated based on AVWAPS, shows entry point and SL .
There is another signal shown and P_Buy or P_Sell. That's a pullback buy or pullback sell , generally much more accurate than a normal buy/sell
Nifty puts added OI from 22000-22000 which is normal as Nifty went up, so is the cut in the 22k ce OI.
What is abnormal is the cut in 22500pe, that should have added OI by the same logic.
So we now watch two strikes :
Nifty bullish if 22500pe trades below 310 and 22000pe trades below 80.
Nifty bearish if 22500pe trades above 392 and 22000pe trades above 150
On BNF , two strikes stand out. The addition on the 47k ce ( thrice that of 47k pe) and addition in ITM 46500ce.
So we will watch these two strikes
BN bullish if the 46500ce trades above 1175 and 47000ce trades above 870
BN bearish if 46500ce trades below 850 and 47000ce trades below 580.
What's very interesting is the OI behavior on the 46500ce , the sellers kept on selling even when BN went up without any fear.
Makes me say they know something which makes BN much more bearish than NIFTY
Last but not the least, my standard template on eod charts.
Make your own inferences, important to keep the broader picture in mind.
BankNifty had an almost 28% increase in COI today. This COI increase in a large range day ( up or down) would have been justifiable, not in a range day like today. The only logic can be the coming RBI MPC meet from which someone is expecting something very very big
So I went back for the last couple of years and tried to check how BN behaves after such and increase in COI
Then went through the bhavcopy to check which month has seen the increase ( will give an idea / confirmation about these players when they are expecting the event). It's Oct expiry, so this is a near term game
Thanks to everyone who enquired about my well being. For the last almost 2 months, suffering from probable long covid symptoms.
1. I am a type 2 diabetic. Sugar etc was always under control. Now sugars, cholesterol etc have all shot thru the roof. HBA1C at 9 , ACR is 130
2. Joint pains at shoulder , xray-usg-mri does not find any physical reasons
3. Huge fatigue. Getting out of bed or going out is a chore.
4. Problems with short term memory. I am forgetting certain things , have been pointed this out by my near family members, I did not realise this myself. This is actually pretty scary.
5. Abcesses/styes out of nowhere ( one was solved by a twitter doc friend)