Now in total, I am going to give you 5 strategies that you can trade before any big event. All the options are buying strategies. Now you have read behind BTSD. You have told me so many times that you want a blog on it. Look, there is a time for doing BTSD. There is a period, like everything has a time, like there is a period of doing love, it looks good in youth, it will not look good in old age.
So in the same way, there is a time to do BTSD and the best times when something is expected in the big market. So similarly, around the time of the event, something is expected in the big market because there is an expectation in the market to be something big. So youkan makes a lot of money. Now what does BTSD mean?
BTSD means buy today sell tomorrow. I am buying something today and I will sell it tomorrow and specifically the BTSD strategy that I am going to give you. See it is again a beginner level strategy, but you can make money for beginners by buying options. So now what is my logic of BTSD? First, we understand the logic. You have understood BTSD that before the market closes, you have bought before it closes here.
What do you have to do buying? We will talk about it. Now here too, one thingies important because I said it is a beginner level strategy, so I am still going to give you a non-directional strategy. Here, understand what non-directional means. In the market, when people talk specifically about BTSD, then they make an expectation that the market will open a gap up or a gap down.
Now we canal do this trade in Batstone direction, but it will be advanced level. For that, you have to understand the trap that where call writer and put writer are trapped. I will tell you in short, then we will talk about it in advanced strategy. So you understand what am saying. What is the point? I am discussing this point before discussing BTSD.
For example, you are at 18000, I am talking about you. When you are at 18000 and the market is at18000 and you have bought the call option of 18100. You look at the market, the markets at 18000, you have bought the call option of 18100 out of the money. You bought it, so someone sold it. You bought it, so someone sold the call option.
Now the buyer can have unlimited profit. The market can go anywhere from 180000 to 200, 300, 400 and the seller can have unlimited loss. So you understand how a seller is. A seller is a person who wants to earn less money from the market, but he wants to earn regularly. But around big events, as I told you in the last blog, I do not prefer selling because if a big move comes in any direction, then the seller can lose money.
Although sellers hedge and go. If you go to the option chain, I will show you this. This is a very important thing. This is highly important. I show youths first because the concept that I am discussing, people will not see you discussing it. These are some logical concepts and it takes time to understand them.
So it is not like this and this will happen, this will happen, this will happen, money will come. In front of you, you are learning to sail a boat today. You are learning in a river. Tomorrow that boat will sail in the sea and the waves of the sea and the waves of the river are different, but if you train yourself well, then you will be able to survive in the sea.
But most people who have not trained very well, when they go to the market adverse situation, then you will have a loss. There is a big loss of people.
Look here, when come to the NSE option chain, the market is around 18000, but if I show you this thing, then people have bought options of 19000 here and if I talk about falling, then you will see that people have bought options of more than 19000.
People have bought options below this, and have bought options above that, so someone has sold it. So now what happens is that the retail trader does not buy so far.
If the market is around 18000, then you or I will talk about any retail people, then if they want to earn money from the market, then they will not buy the option of 19000.Who buys this option of 19000? These people who do hedge, they buy it. What does Hedgeman? If the market is going in a very volatile direction, then there is no unlimited loss.
Someone has sold 18500, then instead of 18000, 18500 is sold, then 19000 is bought. A far option is bought to hedge. That is why you will see options offer and far, but then someone has sold this too. So now what do you see here, the markets at 18000 and you bought the call of 18100, so someone sold you too.
Now as soon as the market moves towards 18000, suppose the market comes around 18000-1100, then there will be two things here. Either these sellers, you know what the game is, what is the game of? You and we are retailers, there are few people who have a lot of money.
We will trade from 1 lakh to 2 lakhs, from 50 lakhs, from 1 crore to 2 crores, from 5 crores to 10 crores. This10-20 crores are nothing for the market. Someone has 1000-10000crores, the man who has 10000crores can bring a small move in the market. Why am I saying small, because 10000 crores are also nothing for the share market?
Today someone may be feeling big, but definitely am telling you, this is nothing in the market, but there are operators who understand your and my logic. Now understand the logic. First I talk about logic. When you look at the market, when you look at the market, understand the psychological stop loss. Someone was at the market of 18000 from here and sold 18000-100 and you bought it.
You are making a lot ofprofit at 180000-100, but the seller is suffering a loss. Nowthe seller does not let his loss happen, so he pushes the market down. That is why the resistance levels work. The market comes again at 180000-100, but the price falls again from herebecause there was resistance because the seller was sitting here. The seller can be an operator, but now the seller, whendoes he loses when the price moves up again.
Now when it movesup again, it means thateven after falling down twice, the buyers are buying from below. And the seller will be most afraid that if the market moves, then I will run away. When the market comes to18000-120, then he thinks of the next target for himself. His stop loss is done.
A psychological stop loss of the seller is done that if the market moves above where I have sold, Theni will leave. Similarly, if you take a trade at 180000, you see the market at 180000, then you will benefit. It was out of the money for you, but if the market starts falling, then for you also, a psychological stop loss is done.
Because most people do not put stop loss in the system. They take a psychological stop loss. So you also in your mind, I tell you, you are taking a stop loss of 17900 for example, or before that, you are taking atop loss of 17950 that if the price comes here, then I will cut my deal. You will gout. But what happens is that you bought here and you came here and sold. What you will see sometimes is that selling has come here.
As soon as you cut your position, you sold after buying and selling came. Here selling has increased, then the price falls further and then when the price comes here and goes below this, then many people have stop loss here also. Then selling comes and the price falls further, then the price can fall continuously.
Similarly, look at that place. What does the seller do? Now someone must have put sell here. The one who must have put right or must have done call right there, he will try Torun straight to the next place. His stop loss was hit. It will go straight to 180000. Nowhere will be two things at 180000. Whenever you see option change, this is important.
That is why I am taking your time and explaining it to you before explaining BTSC. What you will see that what you will see, it is very important to read this option chain because this is the most powerful thing. Price action is one thing and if you have combined data with price action, then this is a deadly combination.
The chances of making money in this increase more. Some people only trade price action, some people only trade data, but most of my experience says that money is made when you mix data with price action. So the price was going up. People have two expectations, either the price will fall from here or the price will jump from here.
Now how will it jump? Let’s understand this. The way to jumps that here at this strike price, let’s take 180000 at the money, at this strike price, you see an open interest. This is my option chain. Now if we take the current expiry, then you will see more numbers here. Just a second, let it update. So I have come to the current expiry option chain.
So what do you see here? One thing you see here is open interest. See is volume. Now what we are looking for is we have to see open interest shift. The concept is open interest thing you see change in open interest and the third thing you shift and the second concept is volume shift. What I am saying, I hope you are making notes because this is highly important.
People can catch it only after experience. What do you have to catch, now you see without looking at anything, without looking at the price, I can tell you the resistance by looking here that the first resistance is 2.5 lakh quantity at 18,100. For now, the market will not go above 18,100. Why not go because if I look ahead, if I look ahead, then nowhere will there be more open interest than 2.5 lakh quantity.
This data is refreshed on the NSE website every 3 minutes, so you can go and see it. What do you see next is, if this open interest shifts from here, as soon as the seller ran away with the lungi, he was afraid, he jumped from18,100 to 50, you will never see much open interest in the difference? You will never see, so you will always see open interest in the difference of 100, so from 18,100 to 18,200, now there are already many sellers.
Here the open interest is of 183,000 quantities, but what am I telling you, until this open interest is not maximum, open interest is 2.5lakh, here it is 3 lakhs and here you saw the change in open interest was less, so you understand that the market is going to run away from here, but its third confirmation will give volume.
This volume is also there, see now, here it is of 36 lakhs and here it is of 24 lakhs, so at the strike price of 18,200, as soon as open interest and volume start looking higher, what will be my expectation that the market is getting ready to run. May beat that time, nothing is visible on the price action.
Maybe at that time, I am seeing the market in a consolidation, I am seeing this, but now some people will say that this canals be caught in the price action. We will make a triangle like this, we will wait for the shoot up, we will wait here, you have to do this, you will do this, but now you canals make a directional view, now I am on non-directional, but okay, I have taken a little advance in this blog, so what am I trying to explain to you, now what are we seeing,
let’s remove this, were seeing that the market is in a good range, it is not moving anywhere, but what I am seeing is that some candles started to be made, the price was going up and as soon as the price was going up, I saw open interest and volume shifting to the second strike price and that second strike price can be in the difference of 100, sometimes it can be in the difference of 100, sometimes it can be in the difference of more than that,
so the more the difference it has shifted, the more chances there are of what, the more chances there are of the price to jump, so if I am going to do BTSD, then what happens is that generally the whole day the market runs, in the end, the operators, the big players decide where to take the market, the retailers do not decide so much, big money decides where the market will go,
so when you buy an option, what money do you get, but when you sell the option, then you have to give lakhs of rupees for one lot, for this quantity, you understand how much money is being spent, so a lot of money is involved, now because lot of money is involved, when you see a change, like here look at 1,90,000 quantity, here it is 18,500, now I can see4 lakhs of open interest at 500 and the volume has also become50 lakhs,
means I will make my preparation from here for a big shoot up and the same thingies here also, if you are on the put side and you see that something is happening on the put side, then you should come on alert mode immediately, you should come on alert mode immediately, so here we see a little bit,
so if you can see that here open interest has increased, so which sides strong, now I can see the resistance is very strong, there is a strong resistance at 18,100 and the quantity at 18,000 is less than that, but still what is the support for this, 18,000 support and 18,100 resistance,
but if this quantity starts to decrease here, then the resistance will become weak, and as soon as the resistance becomes weak, the price can shoot up, if the price starts to fall here, I will always relate it with price action, what is happening after that, the market was in a range, it is going up and down, it is going down and here I see that at the next level, there is 1,29,000 quantity at 17,800, it reached 2 lakh something and here the volume has increased,
so what I will assume that the price is preparing to go in that direction, so I can make it directional also, there is one more thing to see the option chain, you can see multiple things, if you want that we make a blog on this in more detail, then we will make a comment, because my strategies will be left, I have to give 5 strategies, so now was talking about non-directional here,
now why am I telling the logic of non-directional, because in the starting when you want to catch directional, most of the new people, then you will catch the wrong direction, most of the people will catch the wrong direction, then they can also have loss, that you were on the upside, but the market gap has increased, you thought that the market gap will open down, but the market gap has increased, so you can have a loss, so now how can we benefit from non-directional, now in non-directional,
we told you one thing in the previous blog, which was straddle, but now in that straddle, what we were doing, we were waiting for the market to shoot up and it could have been for the intraday, it could have been positional also, now here simply the BTS is that we are waiting for the next day, now the market is going to open, whatever happened today, it happened, but at the end of the hour, you saw the option, the open interest is changing,
you saw the volume is changing, so you are expecting a big move, that is direction, but still now we comet this, what you are doing BTST, you are doing BTST because you have an expectation that big move can come at the end of the day and you will see around the big events, youkan check the data,
the market gap up and gap down opens in both ways, so that’s why am telling you not to catch direction, anything can happen between the two, so what will happen now, you have bought put and call, now you will say that it is a loss,
why because most of the sellers do this, they short the straddle to earn money, it is not wrong to short the straddle, but when to do it is important, I said that there is a time for love, so in the same way, you are buying put and call, why are you buying, what will be your biggest loss, the biggest loss is that the next day the market does not open,
the gap down opens, so the flat opens, don’t be scared, I will tell you why, now I will explain from here, you saw that you bought put and call both at this place, the next day you saw the market, the gap opened up, so you will benefit in call and you will lose input, but sir tell me one thing, you bought both of 100 points, here you bought both of 100 points, now if the market increases by 200 points, the next day the gap opens up by 200 points,
for example, so you will have a significant profit in the call option, a little theta will go, you will get 200 points, so this is your 100 rupee option, you will see that it is of280-290 rupees and this100 rupee put will not be 0, this won’t be 0, so something will be left in it,
okay, there will be a loss in it, but overall you are in gain, if I consider it as 0 and you don’t need 200 points, the gap up gap down will happen, then it will not be significantly down and if the market opens flat, where the theme has come, then you will have a loss of theta, but I told you in the last blog that when you expect big move in a big event, then at that time the IV increases, so if the IV increases and your theta is less, then you will not have any loss,
now there will be no loss in it, we are not doing on Friday, we are not doing it on Friday, but if you do this on Monday, Tuesday, Wednesday, then your theta will definitely go, but by going theta, we do not have as much loss as the gap up gap down in profit, if you get a gap up or gap down of 300 points in bank account, then you will enjoy it and if you do not get it, if it opens flat, then you remember your last strategy that the market is flat, the springs still being pressed, the market is not moving anywhere,
so still we can hold that option, what you have to check is that if my call output is 50% plus, then I will think of doing something, otherwise am just made, the spring is being pressed, let it be. Let my theta decay, but if it boosts, then I will get the benefit of this move. Are you getting my point? Now what are you going to do with BTSD? What is the strategy?
It is very simple that you come in the last 15 minutes, at 3.15 at any time and you buy both call and put. You can do this on 3.25 as well. It is a choice. So when you saw that the call and put have the same price, you bought both and you went to sleep comfortably.
There Isa big event coming because there are chances of gap up and gap down. So if there is a gap up or gap down, you will get good money. So this is a strategy for beginners, but what did I tell you? I have taken a lot of time for you in this blog to tell you that you check where the open interest and volume are shifting and then you can take one directional trade, but it is your choice. My job is to teach you, the rewards according to the risk.
Always remember that if there is a risk in the market, then according to it, the rewards you are trading in options, you are buying, definitely there is a risk involved, but according to it, there is a reward. Now we are just talking about 100,200, 300 points. What about500 points? What about 600 points in Bank Nifty?
If you get some such moves, then everything is one way and such moves are one way. If you agree with me, you can comment. You did not understand the BTST strategy here. You also tell by commenting, but whatever I am telling you, we are just discussing event-specific strategies that there is a budget, there are actions, there is something big like this.
We are keeping expectations and how money is being made in them, what is the risk in it, what is the reward, I am also discussing this with me so that you understand the concept. So if you want, I will take some time in this way, but I believe in concept clarity.
If you say, we will definitely teach you. Now definitely in this blog, we have discussed a strategy, so for the next strategy, you will have to give me some time. I will tell you that in the next blog. There are 5 strategies in total, so the next strategy of the beginner level is that you are getting things of the beginner level.
If you are a beginner, then you will feel that this is fine, but still will tell you that this is a beginner level strategy. Now there are advanced strategies left, so we will move forward step by step.