Nifty Weekly Option Trading Strategy using Ichimoku Cloud

ichimoku cloud nifty Nov 01, 2021
Nifty, Ichimoku cloud

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In this article, we are going to discuss a simple yet effective strategy to trade Nifty options using the Ichimoku cloud indicator.

Nifty 3rd November expiry 17700 CE (5 Min chart)

In the above chart, we have shown the 17700 CE current week expiry 5 min chart. The shaded portion on the chart along with a bunch of lines is the Ichimoku cloud indicator. The strategy is simple; we look for buying opportunities when the price decisively moves above the cloud.

Once the option price breaks above the Ichimoku cloud on a 5 min timeframe we wait for the price to form a higher high and higher low. As soon as the newly formed high is broken we can buy the stock with a stop-loss below the cloud. One can keep trailing the stop-loss with a baseline (red) of the Ichimoku cloud for booking the profit.

Note that this is an ITM strike and the strategy works best for weekly ITM strikes on the 5 min time frame. Also here we are not using the spot chart of Nifty but we are using the option premium chart.

In fact, based on this exact same strategy, we gave a buy call to our Nifty options call subscribers today which has hit our target in intraday itself.

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