Trading Bank Nifty using Options
Bank Nifty – The index overlapped the gap area intraday. The moves up were accompanied with increasing volumes which indicates active buyers in the futures. Bank Nifty is set to move to 25300 levels from here. An option strategy – bull call spread – can be devised by buying 24900 Call 28th March expiry at 430 and selling 25300 Call 28th March at 255. This will create a debit of 174 in the account (this will be the maximum stopsloss) Profits can be booked till 25200 – 25300 levels. However an early exit can be planned if the index moves below 24600 levels.
This strategy was shared earlier today on the mobile application.