The last trading day of the week is here.
The week has not gone well for us so far. NIFTY moved down on Monday, went up on Tuesday and again down on Wednesday. By this trend, yesterday was supposed to end up positive and it did though by just 12 points.
These kind of moves hurt a option buyer. The premium is lost. With that happening, worries begin.
We start having doubts. Doubts lead to two things:
Either we book a loss and get out of trade and see that trade coming good a few days later.
Or we take few more trades with a view to improve our chances of getting a profit. At most times, this just adds to the previous loss.
Taking fresh trades should be based on same methods. New trades should only be taken if your financial resources permit it. We must remember that all trades can go wrong.
With market not moving much yesterday, our trades too did not lose much or otherwise.
I will stay on the sidelines for today as well. No new trades for the day.
Stay cautious, stay watchful.
Disclaimer: This post and examples are for teaching purpose only and are not meant as advice/suggestion to trade in these stocks. Trading in Futures and Options can lead to big losses and should be done with appropriate knowledge and advice only. Mentioning the stocks here does not imply that I have a trading position or likely to take a trade in these stocks.