Question : Can i trade in options of these 50 scrips using cloud only , will it be profitable to do so ? should i use hourly or daily charts for the same .? thanks in advance. – Jitin
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Reply : As of now i hadn’t backtested with options. Right now iam exploring it with nifty futures(min nifty too) and studying the risk level
when compare to profits. Though the strategy is boring and simple so far the strategy is money making.
If you want to trade based on Ichimoku alone in futures there is one more extra rule its nothing but choosing the right timeframe for your trade and limiting your profits by booking it w.r.t to the timeframe.
And one more thing Time frame should be taken based on your profit requirement… The risk in the trade will increase if you are opting for higher timeframe. I request you to follow the below readings for more clarity in opting a time frame
Should i give weightage to lower or higher timeframes?
For Example if you are trading with 5 min charts you should limit your profits to 10pts in nifty by booking your future contract
For 15 min charts – 15-20pts
For hourly charts – 50-75 pts
For Daily Charts – 150-200pts
More over Stop loss is the cloud itself. Which needs to be followed and respected each and every time
dear rajandran,how about selling say,a 5200 put and a 5600 call,n waiting till expiry.if the mrkets take a turnaround in either direction,v cn always change our positions to suit ourselves.afterall markets cannot runaway 300-350 points in a day,unless something unusual happens.
regards n thanks,rashmi
it wud be really helpful if u give ur views regarding the riskd and rewards of such a position.
Hi rashmi, hope I can help you on this. This trade has maximum risk and maximum profit is (48.85*50)-brokerage. 5648.85 is the upper side protection and lower side protection is 5151.15. Maximum profit when nifty is at 5200. This kind of trade is very very risk, you can make good money for almost 9 to 10 months in a year, but in case if the market moves very volatile on one side(up or down), you may lose all your profit in just one or two months. Try trading options strategies which are based on non-directional movement of nifty. Happy trading options 🙂
Thanks Narendar Sir for Giving your views
sir how to use ichimoku indicator on case market on daily time frame