The weekend is gone.

Friday’s heady feeling of the NIFTY all time high must have dissipated over the two holidays. My question to traders always is the same— Did you make money when NIFTY made a new high ?

The answer is always slow in coming and the obvious reason is that no profits were made. Why to bother about NIFTY highs if our trades are not doing well. Let us leave talk about NIFTY, FII Buying and Selling, RBI Policy , Federal Reserve to the TV people. Nobody ever made money from this talk unless you were paid by the channel. We should focus on what we have to do.

PUT BUYER SELECTION : 

The job of PUT BUYER is becoming difficult as the market is rising. But a job s a job and needs to be done. Method is decided. One selection is to be made.

Let us do it.

A look at the NIFTY 50 laggards tells us that Pharma Sector is not doing well. We select DRL ( Dr. Reddy Laboratories ) for buying a PUT.

Current price is Rs. 2083 and the 52 week low is Rs. 1887.

We go for PUT 1950 at Rs. 36.00. Lot size is 250, so maximum risk is Rs. 9000.

Hopefully, the sector and the stock shall stay weak and the trade should work out well.

CALL BUYER SELECTION :

Nothing comes easy in the market except confusion. To get out of this confusion and to make choices for executing the trades is the daily job of a trader. It needs to be learnt, practiced and practiced and practiced. Practice repeated many times will make us good.

Among the NIFTY NEXT 50 stocks, L&T Finance Holdings ( L&TFH ) is a good gainer over the last 30 day period. If the NIFTY rally continues, Financials are the most likely leaders. This stock should do well.

We go for a CALL which is about 8% away from the current price of Rs. 176.20.

CALL 190 at around Rs. 2.50 would be my choice.

Lot size is 4500. Maximum risk is Rs. 11250.

Earlier Trades : 

Just to recall our trades on Day 01 of the series were:

TATAMOTORS PUT 240

YESBANK CALL 400

We shall proceed slowly this month. There is enough time till August 30, 2018.

An Option Buyer talking about time in a positive way is rare. Let us give it due respect. Price move in our direction with good volatility within time is the key.

As the month unfolds, we shall know the impact of all the factors mentioned here.

Trade cautiously, trade profitably.

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.