Advanced Concepts

कब शिकारी खुद शिकार बन जाता है – Playing on the Fears of the Big Money

Hello Friends! Today we are going to discuss how we can be Playing on the Fears of the Big Money. I am going to explain a setup that gives explosive profit and works 80% of time. आज समझते है बड़े खिलाडियों की डर को कैसे हम इस्तेमाल कर के हमारी प्रॉफिट बनाये।

Smart money or big players have capital muscle and unlike us small players, they like to sell options and sit patiently to reap profit on theta decay.

What is the Big Move?

Now, all round numbers like 42500, 43000, 43500, 44000 (I analyse BNF and hence quoting those levels) are psychological levels and most sellers take entry on these strike prices.

Hence, everytime market reaches these levels from one side and start spending some time near it, the worry of sellers start. And that is why, as soon as it crosses that level after consolidating there for some time, there comes a one way fast move of 150-200 points minimum hitting all their stop losses. And that is the opportunity for option buyers for best profits, because the index moves so fast that options fire like rocket.

How To Enter?

Once the move starts, then the option prices go up so fast that it is very difficult and very risky to enter. So, you will have to enter when the market is in consolidation mode near the psychological resistance.

Look for a pattern or a setup and as soon as you get one, enter with a very small stop loss, preferably of 30-40 points and do not exit till you capture at least 100-150 points momentum.

Example

Look at the figure above. It is chart of Banknifty on 28th Apr 2023 on a 5 minute timeframe.

Please observe once BNF reaches near 43000 level, it starts spending time near it and once this level is cleared (Range high of consolidation), the immediate next 5 min candle gives a move of 185 points.

This is the kind of move, we are discussing here. All big players having short position took SL and left and option buyers would have made big profit on this single candle only.

So, friends this is all for today. Will come back with another interesting topic another day. Bye till then. Keep Learning, Keep Trading and Keep Winning.

*In addition to the Disclaimer, I wish to submit that, all the information given here are only for education purpose and I dont give any buy or sell ideas. Investments / Trading in Stock market is subject to market risk and please consult with your financial advisor before taking any position. This blog is created only for expanding my learning through analysis and share this knowledge with my visitors. The writer will not be responsible for any profit or loss directly or indirectly due to the information given in this blog. I do not take responsibility for any information or product link in the pinned comments or in this blog. Hence, please be at your own risk while using/acting on them. Thanks for your support.

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