Bank nifty intraday trading strategy

Its always important to understand what derives the movement of the underlying specially when you are dealing with a highly volatile instrument like Bank Nifty Futures- then surely there is no escape to it. But if you are not the beginner then surely you can escape this. What is Bank Nifty Index? These top 12 banks represents approximately This means that out of all the banking stocks listed on NSE, State bank of India. So, the performance and the price movement of Bank Nifty or inturn Bank Nifty Futures is dependent on these Top Stocks only as rest of them do not have significant weightage.

Now comes the center of topic for this article. What is Bank Nifty Future? This means that Bank Nifty futures will derive its value from the BankNifty index which in turn is dependent upon the movement of top banking stocks in the index. Bank Nifty Future is the second most trade-able and liquid equity index future with total traded contracts of 13,11,51, and turnover of Rs.

Future contract on BankNifty Index was launched on June 13th, This volume does not include the one happened in Bank Nifty or Nifty Options Market. As a new trader, it is important to know wide scopes and opportunity in trading and make your trading task more simple. If you are unfamiliar with options trading, then let us state here that options contract is the right, but not the obligation, to buy or sell a particular futures contract at a specific price strike price on or before certain expiration date.

And if you are familiar with the basics You might have read and heard million number of times that the risk with buying options is limited to the price of the premium paid. But Do You Know that we can even get trapped and lose more than the value of the premium even when you are buying options and what if I tell you that you can incur loss even after having a profitable trade.

Lets come back to Bank Nifty Futures…. Sorry to divert it and take this interim break from futures and get into options. But it was really important….

Trading strategies for the Bank Nifty | Business Standard News

Contract Specifications of Bank Nifty Futures. To understand in detail all the key terms or terminologies used and how a futures trade work in the real market, Read Article: Part VI — Getting Started With Trading: How to trade Futures Market?

Want to be a full-time trader? But this is the first time you are dipping your shoes in the trading world. How to Make Money from Trading in Indian Stock Market? Planning is crucial for the success of any business. Read Article — Getting Started with Trading: Importance of Developing a Trading Plan.

Niftystrategies

Bank Nifty futures has a lot size of 40 units per contract for which an initial margin of Rs. Oct 27th, provided we have a ledger balance to take care of any daily mark to market losses M-M Lossesif any. There are two options available for future traders to meet out the margin requirement for the contract obligation. So, traders who are planning to use the DP Stock or Liquid Bees as a collateral for the margin security are required to take care of any mark to market losses, if any. But on the other side, if you have your first trading profit of say Rs.

Suppose, we have deposited a total capital of Rs. Not advisable for Beginners. Number of Contracts to trade? Beginners should only start trading with one lot size i. So, if you are able to double your capital and had a margin requirement fulfilled for another lot from your profits rather than adding up a fresh capital, then add with one more lot size and start trading with 80 units i.

This basically proves the fact that you are learning the trading business and now you are ready to take more responsibility for trading bigger contract size than before. Capital protection should be the utmost priority for any trader especially when you are trading a high leveraged and volatile product like BankNifty Futures. So, every trader should develop a risk management mechanism which can help to save their seed capital and protect the profits too.

Always protect your trade by using stop losses whenever you buy or sell short BankNifty Futures. Stop loss could also be set fixed according to risk profile of the trader.

We usually take smaller risk of points i. Then market will have to prove us wrong atleast 38 times to knock us out of his capital of Rs. So, do not enter the trade if you cannot decide where to place your stop losses.

Stop losses are your protective tool and will always keep you alive. This will generally help you to achieve a higher end of Risk: Reward ratio by taking more points when you are right and giving our small whenever you are wrong. How to use stop losses to reduce your risk?

This is not a perfect game. I compile statistics on my traders. My best trader makes money only 63 percent of the time. Most traders make money only in the 50 to 55 percent range.

I only make mistakes, which I can afford, where I can lift to begin again. Knowing Who You Are — A Trader or An Investor or An InvesTrader? How Not to Screw With the Market — How to Follow the Trend of the Market? Evaluating Risk to Reward of Each Trade. Never Changing Your Stop Losses with Good Reasons. Knowing the Reasons to Exit a Trade. How not to have too many Open Positions at any time?

It depends on the expectation of the traders. But the easiest way is to target it according to your stop loss i. Beginners should focus and target on achieving 2: Risk scheme to 3: But as your trading experience and knowledge starts to grow, you can strive to achieve a differnet trading style to take big trades of points on BankNifty futures with small risks of points.

As we are trading a The idea here is to strive and achieve the higher end of the Risk: Reward with more trading experience and knowledge of the market so that we can make our trading on some fronts were we have the ability to make big profits from a single trade with less managed or even no risk at all. When You go Fishing, You can Catch a lot of Fish or a Big Fish. Where and how to protect and book your profits?

Time Frame to Trade Bank Nifty Futures Whether Day Trade or Positional Trade. Try to know a market very well that it starts to talk about it by itself what it us going to do in the coming hour, or day or week or the whole month or year.

So always start with big charts because small moves are the part of the big moves. It s always important to follow the big players. They are the one who knows more than us or are an expert in their business, or we should say Market Knows More Than Us. So, Always Follow The Market. When market is showing weakness — Go With It. Always start with analyzing and finding trades on the big time frames Daily or Weekly Chart then get into the intraday charts continuous 5 min, 15 min or 30 min and keep a close tab on the market movement to get a closer entry and with small risk.

Then as soon as you enter the market and you have placed in your stop loss, then again go back to the bigger time frame and see how well the market is performing according to your expectations. Avoid the trap of thinking that trading everyday is the key to success in this business. It is actually a myth. Why Trading Every Day is a Silly Plan And What to Do Instead.

My style is to watch EOD, Weekly and Intra-day charts all together. Our Minute and Opinion matters earning money charts are always in-sync with each other.

So any setup on EOD charts or big 15min charts led us automated binary option signals india enter the market on small charts and whenever we are not able to get a point what the market doing, we stick to intra day charts and trade for the forex szkolenia darmowe. And scalp the market.

A trader needs to have two different brains working simultaneously to get in deep of the intraday chart to understand whether the markets are showing patterns of selling as indicated by the bigger charts or when the markets are not doing so then evaluating whether to trade with the short term current patterns or wait for these patterns to get in sync with the bigger time frames.

So for day trading it would be for points as market has an Average Daily Range of points. So on an average, we can get points any day. Maintain minute charts on software like NinjaTrader or Amibroker or Metastock and analyse the stock option expensing fasb market movements to get an understanding of market movements, and its habits. Get Min data for banknifty futures from here. A dilemma every new Bank Nifty Futures Trader have.

There are times when the markets are forming big setups and patterns on big charts EOD Charts so it becomes important for traders trade these big moves on big charts to earn big profits.

These situations necessarily requires traders to look the market in bigger context and keep entering the markets in bigger way by keep on pyramiding with the favorable moves. So it becomes important to know why you are trading it? Like we have a rule while trading stocks that we never let our trading calls becomes our long term investments.

Therefore, it is always important to know whether you are planning to enter for intraday or positional? Be clear with whether you are trading or investing. The one who broke all the fixed rules of trading and laid down the foundations for others to follow.

I am not a Day Trader. Some of you might be thinking this while reading the above thoughts but really intraday charts are currency exchange rates canada mexico important because they actually help us in managing our risk.

We money earned in nascar take up a risk of points on Bank Nifty futures when trading with say units 20 lots or units 40 lots. Direction of dow stock market today msnbc will be a risk of Rs. So, whenever we are how much money does an lpn make in illinois to achieve on trading the big lot size of the market, the only way to stay in the market is by managing the risk.

Such a strategy alpari uk binary options day trading help you to trade any number of lots or quantity to attain fastest way to get money in runescape p2p profits possible at No Loss.

Why Not Trade Mv forex exchange rate Futures? As Nifty has a small Average Daily Range as compared to Bank Nifty. So it reduces the probability of big profit as compared to the one possible in Bank Nifty. Then its OK to trade high beta index like Bank Nifty. Beginners can start with Nifty Futures then later supplement your study to Bank Nifty Futures.

Deciding the parameters to trade is one side of the game and getting in and applying into the market successfully is bank nifty intraday trading strategy other and yes more important one.

Back-test each technical tool you know to the bank nifty futures market and see what really works for you. Try to filter out the tools which you feel fits under your belt like retracement, double or triple tops or bottoms, etc.

The idea here is to be an expert in one market. So, its better to know more about a market then knowing some about many markets. So, start analyzing the markets on bigger as well as smaller charts and try to understand the habits and characteristics of BankNifty Futures. Part V — Getting Started With Trading — Get unlimited farm bucks on farmville 2 Your Market.

Know Your Market, Trade Big and Stay Safe to remain alive in the trading business forever. It always make sense for traders specially new ones toto enter into a trade when the markets are silent and exit when the markers becomes very violent. Trading volatile marketsmarkets surely gives a trader an excitement and eagerness to make big profits but even many professional traders avoid trading when markets are very volatile and specially on some news days or events.

Excitement within the traders even force them to trade the violent marketsmarkets by entering the long trades when the markets are having a big blow up and forgetting all their money management rules of trading with close stop losses which surely forces them to enter the market at wrong time and at wrong prices and incur big losses.

Human element is a very important aspect in trading as market consists only of human beings. They glossy cardstock paper for laser printer the one who regulate and trades in the market.

So, markets are surely governed by the human characteristics and behaviors and the factors which influence the behavior and psychology of people also influence the markets. To be successful in a human managed and governed business, its a prerequisite to understand the elements which controls and govern our behavior. Any successful trader learns how to control and reduce the element which will force them to commit mistakes and prevent them from making money and being successful.

And one of the biggest among all those is Human weaknesses. So develop the real inside to trade pre-determined setups or patterns and places to get some confirmed points with big volumes and lower risk edge. The objective is to start with Trading with one lot size of bank nifty futures to learn the mechanism and reach to the higher end of the Trading volumes of or units or even more than that.

So, the initial objective of any new trader trading with one lot size should be to earn Rs. So, to achieve this objective, traders need to achieve a profit of approx. Suppose with trading 1 lot, you have developed your trading skill and getting consistently on an average points in a trade i. Or even if you starts to make say 50 points per trade with 4 lot size, the. It will be Rs. Double reward and that too with half efforts.

Taxation of Futures Trading in India. These income must be added to your total income and taxed according to your new respective tax slab. The balance, if any, can be carried forward and set off only against non-speculative business income within eight assessment years immediately succeeding the assessment year in which the loss was first computed. Day Trading Bank Nifty Futures. Average Daily Price Range.

Chart 1 — Bank Nifty Future Continuous Daily Chart with Average Daily Price Range. Also, if you have been trading futures market, then its important to note that trading is all about planning and following your trading rules strictly and nothing else.

So, preparation is generally the key for the success of most professional traders and for traders it all about understanding the importance of designing a trading plan and implementing it. They are no different than us, but just they remain stick to what they planned and follow it blindly. And there is no better way than to learn from the Legends themselves. Hedge Fund Market Wizards: How Winning Traders WinBy Jack D.

Intraday Data for BankNifty Futures. Day traders will require intraday data to trade BankNifty futures. Minimum time frame required is one minute data. Visit our NSE Intraday Data Resource Center to download BankNifty Futures Intraday data. Part VI — Getting Started With Trading — How to Trade Futures Market? How to Trade Nifty Futures? Part VIII — Getting Started With Trading — Tax Guide for Traders in India.

It really helped me a lot to prepare for my trading. Rules on managing risk and starting small really make sense for a trader like me.

Feels like written by a trader himself. Thanks for sharing great ideas. Waiting for more awesome work. Cleared a lot of doubts from my mind.

I am trading from last few Years but at the end I am always on the losing side as i kept on losing what I make every time. Awesome article on preparing a Trading Plan. Keep up the great work. Thanks Sumit for your appreciating thoughts. Yes, maintaining a great balance between the reward to risk ensures survival and growth for any trader. Will surely share some of the setups we use for Entering long or short positions. Inspiring comments always motivate us to share more amazing and inspiring thoughts.

Thanks Sumit for sharing the word. Thanks SriKanth for your positive thoughts. Motivating words always inspire us to write great content. Also, thanks for taking time for commenting. Also, we are very happy to know your interest and willingness to learn about the markets and the opportunities available.

Please let us know if you have any further questions; We are more than happy to help. Hi there, I just stumbled upon your website. I am NOT trading the Bank Nifty futures currently.

I want to trade only in nifty intraday. And would want to learn more about on the same. Can someone let me know good articles available that would be helpful to me? - General - Trading Q&A by Zerodha - All your queries on trading and markets answered

I was wondering if you could clarify my confusion. My broker is Zerodha. Could you please clarify my confusion? Regarding your question on Bank Nifty Future.

The present lot size of Bank Nifty Future is 30 units which means any trader who wishes to trade in Bank Nifty Future has to take position of minimum or in multiples of 30 units.

So, you have to take a minimum position size of Rs. So, any one point change in Nifty future will give you a profit or loss of Rs.

Also, when you are trading stocks or equities you can buy or sell a minimum of one unit but when you are trading futures market, there are minimum lot size where the minimum contract value of any futures contract Index or Stock Futures should not be less than Rs.

You can refer to the articles below to get answers to your questions. These will give you a better understanding on Trading Index Futures, and learn more about money management and trade management rules. Sir,my name is amit,a research student,i want to learn trading options but now at current scenario of hiked lot size,will it b a smart choice for person with limited money in hands as the mobile shop person in this article https: Thanks a lot for taking you time for sending us your wonderful and motivating thoughts.

We are really happy to hear the positive outcomes of our heart full efforts and initiative to help traders across to be independent and learn the skill of trading. Please bear with us for this big reply. The idea here is to be good with your market research so that you can enter the market with very small or less risk.

So, for this hiked lot size, the trader has to prepare a trading plan with strict money management rules which can help him manage and risk small part of his capital on every trade. And as the article Have you ever Wondered why Starting Small always Work in Trading Business? Then you will be in a position to look at the nuggets all together. To put it simply, if you are trading Bank Nifty Options then understand the mechanism and price movement of Bank Nifty Future to come up with some directional and trading view on the index so that you can enter the market very close to the reversals with strict stop losses in options.

You can also refer stop losses as per the Options Chart. Then keep on refining your trading system and plans accordingly as per the results.

Take a directional view as per the big charts and setups and take close entries on the smaller time frames to achieve higher reward to risk ratio, i. Risking less to Reward with more on every trade. One day, you will be able to enter the trade with very small risk and hopefully with very large number of lot size. We truly believe that learner and effortful people like you will surely have a reward full and better trading career. All the very best. These will give you a better understanding on Trading Index Futures, Learning from the Story of Trading Legend — Jesse Livermore, and how to frame a trading plan and learn more about money management and trade management rules.

How to Trade Bank Nifty Futures? I m not a trader but i want to do so. Tpday i fount this site and read this artical now i am prepare to trade with small risks.

We too were under a lot of ambiguity when we started. Thatswhy we started this website and writing posts to help our new dreamers to get started. Happy to know it helped you and motivated you to enter the arena in a right way.

Looking out for more awesome thoughts from you. Do let us know more about your improvements in trading. To the point articles and resources which are informative, educative in an easy to understand language and style.

Highly appreciate your trading strategies. Thanks for your kind words… Feeling refreshed and awesome to read your thoughts. Hi All, I want to trade Bank Nifty but I am confused as to how much tick size and tick value is. If I use 1 lot Bank Nifty at buy and get stopped out athow much have I lost?

How much movement is 1 Index point? How much will I lose? I can understand your concern. Let me try and clarify. There are two different index futures.

The levels you are talking about is of Nifty Futures. As Bank Nifty is trading at some levels. Here, Nifty Futures has a lot size of 75 units where as Bank Nifty has a lot size of 40 units which means 1 price movement in Nifty is Rs.

So, as in the case you mentioned, if you bought nifty futures at and stopped out then you will incur a total loss of Rs. You can visit the article. The weights are based on the market capitalization of banks in the banknifty. The bank whose marketcap is higher will be given high weightage and so on. The current weightage as on MAr 31, is HDFC Bank Ltd. About Privacy Policy Disclaimer. Just Trading ALL MEN ARE CREATED EQUAL, THEN SOME BECOME TRADERS! Menu Home About Start Here Products Resources Get Inspired Contact.

Lets come back to Bank Nifty Futures… Sorry to divert it and take this interim break from futures and get into options. Final Settlement Procedure Final settlement will be Cash settled in INR based on final settlement price. Settlement All the Future Contracts are Cash settled in INR. Signup now and you will get once-a-week update when we do awesome things around here! Latest posts by Just Trading see all Day Trader Lost Rs. Just Trading November 2, May 10, BankNifty 22 Comments.

Home About Start Here Products Resources Get Inspired Contact. Last Thursday of the contract month. Final settlement will be Cash settled in INR based on final settlement price. All the Future Contracts are Cash settled in INR.