Options Trading using Momentum indicator KST with Bollinger Bands® Volume profile

bollinger bands nifty option trading trading Aug 14, 2023
Options Trading using Momentum indicator KST with Bollinger Bands® Volume profile

Bollinger Bands® and KST are powerful way to directly trade options. This technical analysis indicator if used properly can form complete trading system.

Bollinger Bands indicator is used to determine if there is significant breakout but this has to be combined with KST momentum indicator to check sustainability of the move.

Nifty 19500 Put options 15 minutes chart:

Nifty Nifty Volume profile hourly chart

Options Trading Strategy - Nifty Options chart 19500 put shows Bollinger Bands along with KST momentum indicator. As per this chart Bollinger Bands shows if there is a significant movement and breakout in one direction. This has to be accompanied by KST move above 0 line as well. Also just breakout on Bollinger Bands is not sufficient as it has to be looked in conjunction with consecutive candle. So on 14th August, 15 minutes candle closed above upper Bands but the subsequent candle did not break opening 15 mins candle high and so the position is not initiated.

The above strategy is used for Intraday trading but can be applied for positional trade setup as well. Understanding exact application of Bollinger Bands with KST is utmost important.

Volume profile – Nifty volume profile shows big player activity near 19520 (fut) levels. This is also known as Volume at prices. The big players positions are created at this level and prices are flirting around it. So, a decisive break above 19520 (fut) – 19490 (spot) is must for Bulls to take control over short term. Move back below 19250 can result into serious selloff and confirm distribution at the top. This then can be combined with Options Trading strategy given above for high conviction trade setups.

In a nutshell, by combining this price and volume focused techniques of Bollinger Bands, KST directly on Options chart and identifying price action reversal areas using Volume profile one can form prudent trading strategy both for Intraday and positional. If Nifty fails to break above 19520 (fut) as per Volume profile and gives sell signal again on Bollinger Bands will provide classic trading strategy.

Options Trading Using Technical Analysis (OTTA) -  Learn to Trade Stocks and Options using these simple powerful techniques on 19th – 20th August 2023 along with Option Chain analysis, Strike price selection, Open Interest analysis, Volume analysis, Ichimoku Cloud trade setups. This technique can be applied not only on options but even on Stocks directly. Learn to generate passive source of Income. Limited seats. Fill below form for more details: