NIFTY had second losing day yesterday. It fell by 73 points.
Did this fall help us?
No, not much.
PUT BUYER :
Some of the PUTS went up but some lost out also. BIOCON and TATAGLOBAL were gainer stocks on such a day. Our bad luck. HINDALCO too did not do well. Whatever little gain was to come was from RELCAPITAL and TATAMOTORS.
Tata Motors made a new 52 week low and then moved higher from there. The 52 week low tells us that there is weakness. It should pay to stay with the trade.
IDEA PUT 50 was possible to get at Rs. 0.80 and it did fine for the day. How it fares from now on is more important.
Here is the position of PUT BUYER :
Not much to show for all our efforts. Let us stay with the trades and wait for the market to make it right.
CALL BUYER :
GAIL CALL 400 recovered a little but YESBANK and INDBULHSGF went wrong badly.
So we are in a similar situation even with CALLS.
We stay with these trades as well.
It is difficult to keep the belief in the face of mounting losses. Unless we do that we may not come through this ordeal successfully. There are no guarantees of profit in Options Buying. What worked for us in the past should work in present and future as well. Final consolation is that we do not lose more money than the premium paid. I know that is not palatable to many of the traders but if a loss has to happen, it will happen. Frantic and excessive trading can not make it go away. That is why staying patient is the best way to deal with this kind of situations.
Outlook For Today :
Asia is again weak. So we should not expect something out of ordinary. SGX NIFTY is down 5 points as of now. That is no indication. A range bound day is more likely which can be damaging for our positions. With a holiday tomorrow, time decay will be for two days today. This is the fate of poor Option Buyer. He is to be squeezed from all sides. But we came out of this earlier and expect to do the same again.
No new trades for today. Be watchful with the existing trades.
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.
Madan Mohan August 14, 2018 at 10:38 am
Dear Sir, Our old favourites like SBI puts and Airtel puts look good in the present market. SBI can reach upto 250, I assess.Reply
Madan Mohan August 14, 2018 at 12:17 pm
UPL – looks like Investors selling in small quantitiesReply
PRAKHAR August 14, 2018 at 3:45 pm
Sir, India Cement is in the constant downtrend. Is it Good to look at 95pe?Reply
Kishtaiah August 15, 2018 at 5:13 am
I want to sell call options or put options any way bythe moth end premium will be decreased.how u will suggest sir got that statageyReply
Jerry August 15, 2018 at 5:45 am
Sir, I have been following your blog since one month. l opened my trading account a couple of days back. From all the trades that are ‘on’ (in this blog) which two trades would you recommend (to enter) at this stage?Reply