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Bank nifty option chain analysis is easy and essential for technical analysis

Bank nifty option chain is used to get trend. It gives idea about active script with volume. But always remember after doing technical analysis if you compare Option chain then your accuracy will increase. So free check accuracy for one month of daily Bank Nifty trend posted here before market open.

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Bank nifty option chain analysis is easy and essential for technical analysis

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  1. Bank nifty option chain analysis is easy and essential for technical analysis

  2. Here in this article we will discuss about banking nifty index Options trading and how to do option chain analysis? Is it really helpful or much hyped? What is co-relation between trend and option chain analysis? Is trend depends upon option chain analysis or only trend is sufficient to trade in Option contract? Where we can get free and accurate nifty bank trend before market open to trade in option? Is option chain analysis better for intraday or positional? We will also discuss the common mistakes made by trader in intraday with examples. In many article you may find that option chain analysis shows the trend for intraday. But it is false. Because Bank nifty option chain is list of all contracts available for trading. In this chain analysis you can find at the money contract, in the money and out of money contract and you can know where open interest is high. High open interest contract generally act as support and resistance for positional trading, so it better works in positional trading but as Bank nifty is highly volatile and in intraday trading open interest changes quickly and difficult to follow. Traders generally get trapped in false trend. But technical and professional traders generally follow technical trend because if you know the trend then automatically open interest follow the trend, changes direction accordingly and no need to look open interest. Traders generally follows free Bank Nifty Today trend here which is posted daily before market open at 8.45 am and check accuracy to know how trend, unique support and resistance is important than option chain analysis.

  3. Then why I will follow Option chain? In Bank nifty option chain traders should check and select “At the Money call” or “Put options” to trade. But trick is you should check in which strike price the Open interest % is high. It means that contract is more active. This indicates more traders are betting on this contract. But it can’t give you the trend. So for trading, trend is important as you have to decide to take “Call or Put” option. If the trend is positive then you will buy Call option with high open interest and if trend is negative you should buy Put option with high open interest. Technical traders in India generally follow free Bank Nifty Today trend to get trend, identify false levels, unique (you can check) support and resistance to know technical trend which is posted here daily before market open. Important Strategy Technical traders follow the strategy posted here and find the exit point much before. Practically think if you can know the exit point much before then you can get big points confidently and using multi fold strategy in expiry day traders can get 7-8 times profit.

  4. Why trade in “At the Money” contract in Intraday? Non technical traders trade in out of money option contract in intraday. But this is technically wrong and it is too difficult to trade in out of money contract. That’s why they get trapped and lose money. Traders should always trade in “In the money” or “At the money contract”. Why? Let’s take an example to better understand. You buy Bank Nifty “out of money” call option @20/- and I buy “at the money” call option @ 200/-. Banking nifty index moved up 70 point. Now my call option price would be 250/-(20% increases) where your call option price will increase to 24/-only which is same 20% increase. If technical pattern indicates false trend reversal then I can move out easily by booking profit where as you can’t be satisfied by 4/- profit and you would wait for more. Here you would be trapped by greed and psychology. This is the trap. So always use at the money contract to trade in bank index nifty option as it is more volatile and you can get profit quickly. So get free trend of Nifty and Bank nifty trend daily to learn more strategy and trade to earn good profit like thousand others in India.

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