Bank Nifty Trade for Outcome of UP Election Exit Polls

Bank Nifty is trading in a range for last 3 weeks awaiting outcome of Elections across various states and especially UP. Tomorrow after 5.30 pm Exit polls will give some picture about outcome of these elections. Market will react to these Exit polls on Friday!

Strategy for this scenario can be as follows for option trading by buying options:

Buy Put and Call weekly options expiring Mar 16 in equal lot of strike price almost 400-500 points away from spot price of Bank Nifty at around 3-3.15 pm tomorrow. The premiums will be on higher side due to increase in volatility(that's not favorable to buyer of options).

On Friday Bank Nifty likely to open 300 points Gap Up/Down. In that case The option where Index move is favorable may become 2.5-3 times of purchase price while other side option may fall to 0.5-0.25 times of purchase value that should be exited as soon as market opens for trade. But one will get Net profit of 50-100% of capital invested. The option premiums will drop due to drop in volatility but sharp price movement on one side will help to achieve profit.

In case there is no major Gap Up/Down (very Low probability, but can't ruled out), losses would be higher due to reduction in premiums due to drop of volatility and one will have to immediately exit all position at the opening of market.

Comments

Bank Nifty for Week Starting Jan 16, 2017

Last week Bank Nifty made big up move of 650 points. High made is 18966. It looks like it is ready for further up move. On hourly chart Middle BB line(RED color) is providing support and Index may again move up towards upper line of Blue Channel. The Best trading strategy is now to go Long when Index is bouncing from Middle BB line and Exit when it is near upper line of Blue Channel. Hourly RSI shows Resistance at 85 level and Support at 59 level. So Blue channel along with RSI levels are good indicators for trade. It is not good idea to go short as Up Momentum is strong. If Index breaks Middle BB line then only short positions should be taken. If Bank Nifty breaks 18850/18800 then we may see it reach quickly to 18650/18600. Also it may break RSI support level of 59 for major correction. We may see Index moving along Upper BB line (Blue color) on Daily chart. Index may face resistance at 19150/19200 level. If it crosses 19200 it can reach to 19500/197000. Daily RSI is

Bank Nifty EOD Update Feb 15

Bank Nifty today move down sharply after opening Gap up and making Top of 20368 just near Gann No 20364 and reversed sharply making Low at 20115 and closed at 20163. It seems wave B is completed at 20368 and wave C is started (confirmation only when Bank Nifty crosses 20000). We may see bank Nifty moving sharply to 19700/19500. Daily chart shows RSI crossing 70 level from top that shows possibility of down move. Also Bank Nifty broke lower channel lines (Blue as well as Red). So Bank Nifty may fall sharply in wave C.

BanknIfty Update for Jul-15, 2020

Banknifty opened Gap Down and continuously moved down. In the last 2 days, it almost falls more than 1200 points. We are able to capture this move from almost the top of 23000. The daily chart shows Banknifty took support at 30-EMA levels. MACD signal gave a bearish crossover signaling possibility of further fall in the coming days. RSI @ significant levels of 50. Break of 20900 could lead to a sharp fall towards 19700/19500. On the hourly chart, the MACD signal gave bearish crossover yesterday, and we saw a good fall in Banknifty. Gann Box: Weekly Gann Box shows Banknifty exactly changed the trend from the time factor zone. Also, the weekly opening was near the angle and it reversed after hitting angle and gave a good fall. It signaling a bearish trend for the coming weeks. On the daily Gann Box chart, we can see today Banknifty opened near angle, hit angle, and reversed sharply giving good down move. FNO Data: The future OI decreased by 7% signaling short covering with fall. The spot

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