Market Update: Nifty Faces Bearish Pressure, 17-21st feb
Nifty closed at 22,929 this week, marking a decline of 630 points from the previous week's close. The index reached a high of 23,568 and a low of 22,774. As highlighted in my previous post, the bearish sentiment in Nifty remains intact, as both the monthly and weekly timeframes show negative trends. Until there is a significant reversal on these timeframes, the bearish outlook is expected to continue.
Looking ahead to next week, I anticipate Nifty will move within a range of 23,450 to 22,400 . The 22,300/22,400 zone offers strong support, and if this level is breached, we could see Nifty heading towards the 21,800 levels. Given this volatility, Nifty might not be the ideal index for small investors, particularly those heavily invested in mid and small-cap stocks. Let’s now take a closer look at the mid-cap and small-cap indices.
The Mid-Cap Index is currently near its key support level of 48,700 on the monthly chart. If it manages to hold this support next week, a potential reversal could follow, offering some relief to investors. On the other hand, the Small-Cap Index is still far from its crucial support of 14,500, which suggests that we could witness further downside of 4-5% in this segment . This could add more pressure on small-cap stocks, which are already facing a tough environment.
On a global front, the S&P 500 has finally broken through the strong resistance at 6,100 and closed above this level. If it manages to sustain above 6,100, we could see it reach 6,225 or even 6,376. This could potentially provide some tailwinds for the Indian markets, but for now, it seems that the Indian market remains under the tight grip of bearish forces.
In conclusion, while there are some signs of potential recovery in specific indices, the overall sentiment remains cautious. Investors should stay vigilant, especially in mid and small-cap segments, as the road ahead could be bumpy.
Optionsstrategies
MP Materials Options Ahead of EarningsIf you haven`t bought MP before the previuos earnings:
Now analyzing the options chain and the chart patterns of MP Materials prior to the earnings report this week,
I would consider purchasing the 25usd strike price Calls with
an expiration date of 2025-6-20,
for a premium of approximately $2.97.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
Opening (IRA): IBIT March 21st 49 Covered Call... for a 47.32 debit.
Comments: Adding to my positions at strikes/break evens better than what I currently have on, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 47.32
Max Profit: 1.68
ROC at Max: 3.55%
50% Max: .84
ROC at 50% Max: 1.78%
Will generally look to take profit at 50% max, add at intervals, assuming I can get in at strikes/break evens better than what I currently have on, and/or roll out the short call should my take profit not be hit.
Opening (IRA): IBIT March 21st 52 Covered Call... for a 49.83 debit.
Comments: Back into IBIT, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 49.83/share
Max Profit: 2.17
ROC at Max: 4.35%
50% Max: 1.09
ROC at 50% Max: 2.18%
Will generally look to take profit at 50% max, add at intervals, assuming I can get in at strikes better than what I currently have on, and/or roll out the short call if my take profit is not hit.
Opening (IRA): TNA March 21st 37 Covered Call... for a 36.06 debit.
Comments: On second thought ... . Maybe I'm not done with March yet. Here, selling the 84 delta call against shares to emulate the delta metrics of a 2x expected move 16 delta short put, but with the built-in defense of the short call. This is less risk than what I ordinarily take, but still has the >2.0% ROC at max I like to see out of these setups.
Metrics:
Buying Power Effect/Break Even: 36.06
Max Profit: .94
ROC at Max: 2.61%
50% Max: .47
ROC at 50% Max: 1.32%
Opening (IRA): TMF March 28th 36 Covered Call... for a 35.08 debit.
Comments: Selling the -75 delta call against shares on weakness to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 35.08
Max Profit: .92
ROC at Max: 2.62%
50% Max: .46
ROC at 50% Max: 1.31%
Will generally look to take profit at 50% max, add at intervals if I can get in at strikes/break evens better than what I currently have, and/or roll out the short call on approaching worthless if my take profit is not hit.
GOLD--> Test ATH 2942. Are buyers ready to act ?OANDA:XAUUSD testing ATH levels which could trigger growth momentum. The target of 3000 is getting closer day by day. Imminent in the near future...
Metals are consolidating after the price surge, maintaining an upward trend. Supported by Trump's tax plan and Fed easing expectations.
Meanwhile, the US Dollar (USD) and US Dollar Index (DXY) are significantly weaker. Markets are reacting to the delay in tariff implementation and comments from Trump and Powell about the need for interest rate cuts (requiring weeks or months before implementation), which has supported gold. Ahead lies potential profit-taking and impact from US Retail Sales data for January to be released.
Resistance levels: 2942, 2950
Support levels: 2929, 2923, 2908
Emphasis on key support levels. From there, price will realize growth potential. I don't rule out the possibility of retesting 2929-2922 before buyers continue their action.
Best regards, Bentradegold!
Gold → Accelerating Upwards NorthOANDA:XAUUSD returning to the trend following news (inflation). The northbound train may continue from 2907. Upcoming unemployment claims and PPI data.
Gold is supported by uncertainty surrounding Trump's tariffs and economic data from the United States. The Fed remains hawkish due to rising inflation, pushing bond yields higher and driving prices down to $2,865 briefly. However, buyers quickly returned, pushing prices back up.
Meanwhile, traders are awaiting PPI data which could influence Fed policy.
Technically, prices are consolidating in the buying zone compared to key points at 2900 and 2907. If buyers can hold and strengthen above the 2907 resistance level, gold could update ATH in the medium term. Additionally, focus is on 2918 - 2920. Price consolidation above this zone will also support prices.
Best regards,
Bentradegold!
GOLD → Accelerating northward. Targeting $3000Hello dear friends, Ben here!
Today, gold continues its strong upward momentum. Taking inspiration from previous growth - high economic risk. The price is moving increasingly closer to the previously anticipated mark of $3000.
Accordingly, gold broke above the trend channel boundary and the $2850 mark at the start of the week in the US, but growth is being limited by the strengthening dollar due to escalating trade risks. Trump announced on Sunday that he would impose new 25% tariffs on all imported steel and aluminum products, exacerbating the pain for the Euro and commodity-linked Australian Dollar (AUD) and New Zealand Dollar (NZD), thereby channeling new buying interest into the safe-haven currency - the US Dollar.
Gold prices also benefited further from the People's Bank of China (PBOC) expanding its gold reserves for the third consecutive month in January and expectations of more stimulus measures from China. However, in the coming days, USD could extend its recovery if risk flows intensify or markets return to profit-taking on USD short positions before US CPI inflation data is released on Wednesday. Moderate expectations from the Fed, hopes for Chinese economic stimulus, and lurking trade war risks will help limit gold's downside.
Technically, we are currently monitoring around the psychological area of 2904 and the main support level is 2882.
Resistance level: 2904 (unconfirmed)
Support levels: 2882, 2870, 2853
Bulls seem to remain hesitant around the 2904 area with prices potentially continuing their upward trend without any reversals. But! The most likely scenario at this point is a false break of 2904, with a short-term correction to retest liquidity before bulls head northward.
GOLD → Heading into tonight: Is 3K still a valid target ?OANDA:XAUUSD has approached the 2950 level but has yet to reach the key psychological threshold. The current price action indicates a correction phase, allowing the market to rest and accumulate liquidity ahead of key news releases, with a potential move northward on the horizon.
Gold is currently testing the 2900 level following Trump’s new tariff announcement, maintaining strong demand. The primary focus remains on Powell’s speech and the U.S. inflation data, as these will be the key factors influencing expectations for a Fed rate cut, which is the main driving force behind gold’s movement... Theoretically, the situation remains unclear as gold approaches strong support levels.
From a technical perspective, a correction is a logical scenario in a strong market. Technically speaking, prices cannot rise indefinitely; they require energy, which is replenished through seller pressure.
Currently, key focus areas include 2912, Fibonacci 0.618, and Fibonacci 0.5 levels.
Resistance levels: 2912, 2930
Support levels: 2901 (Fibonacci 0.618), 2888 (Fibonacci 0.5)
Powell’s speech, scheduled for tonight, and tomorrow’s U.S. inflation data will be the main catalysts. High volatility is inevitable. However, overall economic conditions continue to support this precious metal.
Before moving higher, gold may first test 2901 and 2888. The target remains within the familiar range of 2950 to 3000.
Best regards, Bentradegold!
Gold price rally continues from resistance level 2934 !Hello everyone, today is the last trading session of the week, let's see how the gold price fluctuates!
⭐️Market Summary:
- Gold has broken the resistance level of 2919-2921 to form a continued uptrend in today's Asian trading session, and the resistance zone of 2919-2921 will be formed to create a new support zone here
- If we observe and trade on the H1 time frame, we can see the price increasing in a clear trend according to Dow theory.
Trading plan:
Wait for the price to consolidate above the resistance level and continue following the Buy wave
👨💻XAUUSD Buy zone 2931 - 2933
🔹SL 2929
🔹TP 2935 - 2937 - 2940
Wishing you all FULL TP ❤️❤️
Opening (IRA): UNG March 21st 18/June 20th 35 LPD*... for a 15.04 debit.
Comments: Fading this natural gas move here with a long put diagonal, buying the back month -90 delta put and selling the front month 25. The 35 long put is shown at the 21 strike due to the 35 being off the chart.
Metrics:
Max Profit: 1.96
Buying Power Effect: 15.04
ROC at Max: 13.03%
Break Even: 19.96 relative to 19.68 spot
Will generally look to take profit at 110% of what I put it on for, roll out the short put on approaching worthless.
* -- Long put diagonal.
Opening (IRA): SOXL March 21st 23 Covered Call... for a 21.09 debit.
Comments: Adding at strikes better than what I currently have on, selling the -75 delta call against shares to emulate the delta metrics of a 25 delta short put, but with the built-in defense of the short call.
Metrics:
Buying Power Effect/Break Even: 21.09/share
Max Profit: 1.91
ROC at Max: 9.06%
50% Max: .86
ROC at 50% Max: 4.03%
Will generally look to take profit at 50% max, add at intervals, assuming I can get in at strikes better than what I currently have on, and/or roll out the short call if my take profit is not hit.
DVA DaVita Options Ahead of EarningsAnalyzing the options chain and the chart patterns of DVA DaVita prior to the earnings report this week,
I would consider purchasing the 175usd strike price Puts with
an expiration date of 2025-2-21,
for a premium of approximately $8.45.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
USD/JPY ---> Will the Bulls Recognize the False Breakout?Dear friends!
Overall, USD/JPY, after hitting support and forming a false breakout below the local trend channel's lower boundary, the currency pair has resumed its upward movement, supported by the strengthening dollar at this time.
Currently, the price has stabilized above the support level but remains below the 34 and 89 exponential moving averages (EMA). Fundamentally, the recent context has been unstable and depends more heavily on US economic data. People have long forgotten about interest rate growth in Japan and are focusing on economic data from the West.
On the chart, the uptrend remains the primary trend, so we maintain a buying preference. If the pair can consolidate above 152.00, then in the short and medium term, we should expect prices to reach the targets as indicated on the chart.
Best regards, Bentradegold!
Opening (IRA): TNA March 28th 35 Covered Call... for a 34.04 debit.
Comments: Adding at strikes better than what I currently have on, selling the -84 delta call against shares to emulate the delta metrics of a 16 delta short put, but with the built-in defense of the short call. Going lower net delta here as a personal choice, since I've already made goal for February, so don't see the need to take on my normal amount of risk.
Metrics:
Buying Power Effect/Break Even: 34.04/share
Max Profit: .96
ROC at Max: 2.82%
50% Max: .48
ROC at 50% Max: 1.41%
Will generally look to take profit at 50% max, add to the position at intervals if I can get in at strikes/break evens better than what I currently have on, and/or roll out my short call on approaching worthless if my take profit hasn't hit.
$SPY Options - Bull & Bear | February Week 2We have been range bound the last three weeks. Sellers are starting to exhaust buyers more quickly than before. We are leaning bearish but confirmation is king. We use 15-30 minute candle closes for confirmation and stop-loss.
Should there be a significant pullback, $580 and $560 are major floors of support.
Here are our bull and bear options for this week:
$600 PUT 2/24
Entry: Confirmation of breakdown under $603.44 (OR harsh rejection at $606)
🎯Target: $600 ($603.44)
$608 CALL 2/24
Entry: Confirmation of breakout over $606
🎯Target: $607, $608
Here's how last week's options went:
📜 AMEX:SPY $605 Call 2/21
$500 → $770 (+54%)
📜 AMEX:SPY $605 Call 2/18
$350 → $645 (+84%)
[02/10] SPX – GEX Until the First Weekly ExpirationThe SPX opened with a huge gap-down in both the futures and CFD markets. After the previous two Fridays, there was a massive gap-down in the premarket each time. Everyone was expecting the same scenario again, but it seems the market quickly recovered from the put support at the 6000 level, and we are now steadily moving toward the positive GEX range.
Although we are still in the transition zone (where it’s easy to switch between positive and negative GEX territory), we may soon reach the HVL level at 6060, which, if I had to guess, might be adjusted during today’s premarket update.
The GEX levels align with the technical foundations:
🟢 6090–6100 to the upside is a bullish take-profit zone, and our purely positive GEX range is fairly narrow. If buying pressure is strong, above 6100 we could see a very strong positive gamma squeeze upward.
🔴 To the downside, “armageddon” could begin if the put support around 6010–6000, which held the sell-off this morning, fails to hold. The next target in a negative gamma squeeze could be 5950, followed by 5900.
The transition range is quite wide, and the market is expecting a volatile week (though I believe that from now on it’ll expect volatility every day for the next four years...).
The transition zone is sure to narrow by Friday. It’s worth paying attention to the premarket update around 6:45 AM, about three hours before the market opens!
If the red zone extends very deep afterward (for example, if it’s red below the HVL level all the way to the put support at around 5950), it indicates a significant downside risk compared to any potential rally—which I don’t think will change unless we get a breakout above 6100.
🔶 So, be cautious with those bullish horns—below 6100, we can’t talk about a confirmed breakout to the upside.
GOLD → First declines, then continues to conquer $2,900OANDA:XAUUSD is currently moving slowly on a bullish trend platform, with the price fluctuating around $2,868 and rising by approximately 0.45% on the day.
Inflation remains on an upward trajectory, and gold is responding as a safe-haven asset. "Gold is on track to reach $2,900 per ounce, and market sentiment remains highly optimistic, despite the short-term strength of the U.S. dollar."
Furthermore, recent statements from Federal Reserve officials indicate that major policy uncertainties—including tariffs and other issues stemming from the early days of former President Donald Trump's administration—are among the biggest challenges in determining monetary policy direction in the coming months.
Currently, the market's focus is on the upcoming Non-Farm Payrolls (NFP) report, set to be released on Friday, which will provide further insights into the overall strength of the economy and the Fed’s policy path. Theoretically, a disappointing jobs report could strengthen the case for interest rate cuts in the U.S., thereby boosting gold prices. However, the opposite scenario is also possible.
From a technical standpoint, gold prices may decline from the $2,870 resistance level to accumulate liquidity and prepare for further upward movement. Specifically, the price could react to lower trend boundaries and the previously broken resistance of the ascending channel. There are no fundamental or technical reasons to break the current trend, and growth may resume after a potential false breakout.
Regards Bentradegold!
USD/JPY: What's Changing at Year-End?Hello, dear friends!
As the year comes to a close, USD/JPY has shown significant movement, reversing course and dropping below the 157.00 mark. This late-year shift comes as market participants prepare for midweek closures and reduced activity around the New Year holiday. Despite lighter trading volumes, price action remains dynamic, signaling potential shifts in the trend.
Technically, USD/JPY has failed to maintain its position within the parallel ascending channel, suggesting the emergence of a new trend. A key level to watch now is the immediate support at 156.03. The critical question is whether this support will hold and for how long. Looking at the bigger picture, sustained consolidation below the broken channel could lead to a move toward lower targets, as indicated on the 4-hour chart.
If you find this idea insightful, don’t forget to leave your thoughts in the comments below and share it with your network. Your support gives me immense motivation to continue sharing valuable experiences and strategies in the forex market. Let's conquer this journey together!
USDJPY: Correction before dropping to 153.00-152.00Hello everyone, Ben here!
USDJPY has yet to resume its upward trend. Rumors about potential actions from the Bank of Japan (BoJ) are beginning to surface. Meanwhile, the US dollar continues to gain strength.
The 158.46 level represents a strong resistance zone established by the sellers. Strong expectations for an additional interest rate hike by the BoJ this week are also lending support to the JPY. Overall, this influence appears relatively weak but could still provide significant backing for this currency pair.
In theory, any upward movement of this major pair might be limited due to trade policy risks from the soon-to-be-inaugurated US President Donald Trump, which have constrained any significant bullish moves for the safe-haven JPY.
The focus this week will be on Trump’s inauguration speech on Monday and the highly anticipated two-day BoJ policy meeting beginning on Thursday.
From a technical standpoint, the price is attempting to break out of a major range and test key support levels. A false breakout around the 156.56 level could lead to the price targeting newly formed resistance zones. However, if the price settles below 156.56 or even drops under 155.95, it could trigger strong selling pressure sooner than expected.
Best regards, Bentradegold!
Trading the VIX - A Balanced Strategy for Smart InvestorsWarning:
This strategy is presented as a trading idea and should not be considered guaranteed trading guidance. Traders are responsible for their own decisions and should carefully evaluate risks before executing any trades.
Given that VIX is generally between 13 and 20, I designed this option strategy.
Combination VIX Vertical Spreads
Strategy Overview:
Days to Expiry (DTE): 37
Option Positions:
Buy VIX 13 Call
Sell VIX 15 Put
Sell VIX 20 Call × 2
Visualized Setup
Strategy Summary:
This strategy results in a combination resembling a modified short straddle centered at VIX 20. However, in structure, it is better understood as a short strangle (neutral) combined with a bull call spread (bullish). The bullish component of the spread suggests that the trader expects the VIX to rise above 13 but remain below 20. The inclusion of a short strangle component helps offset the premium of the debit call spread.
This structured approach allows for a calculated risk-reward balance, aligning with the trader’s outlook on implied volatility while leveraging option spreads to optimize capital efficiency.
Risk and Reward Assessment:
The strategy is heavily weighted towards a long VIX bias, meaning the trader anticipates an increase in VIX, though at a measured pace within a month.
There is a slight increase in risk to the short side of VIX due to the exposure created by the short options.
The expected profit range suggests that VIX volatility will stay within a defined range of 14 to 24. While the trader acknowledges the possibility of VIX exceeding 20, it is not expected to surpass 24.
The probability of profit at expiry is estimated at 65% if entered today. Despite the additional short-side risk, the overall risk remains comparable to a standard short strangle.
Historical VIX data indicates that the index fluctuates between 12 and 40 on a monthly basis, with a 52-week high of 65.7 and a 52-week low of 10.6. This reinforces the strategy’s inherent higher risk to the long VIX side.
Key Considerations for Execution:
Event Risk: Confirm that no major events (e.g., geopolitical instability, Federal Reserve announcements) are expected that could push VIX above 30.
Entry Timing: Optimal entry is when VIX is at a relatively low level, such as observed last Friday (2/7/2025) morning.
Exit Strategy: The position should be closed in approximately two to three weeks or when profit exceeds 100%.
Notes and Alternative Strategy:
One challenge of this strategy is the uncertainty in determining a precise stop-loss strategy. However, given the nature of a strangle, there is no immediate need to exit within the first 20 days, making it a relatively "lazy" management strategy. The trader has ample time to adjust after the initial 20-day period.
Management should be approached by treating the bull call spread and short strangle separately. Given the natural variance of VIX, this approach should not be overly difficult to execute.
A suggested alternative strategy might provide more controlled risk exposure. For example, I would start the trade with a butterfly at 20 if I see the potential rise of VIX. Then, I would reassess it after 30 days (assuming DTE=37; a shorter DTE may also be considered). Alternatively, I could simply wait until expiration day to make a final decision. This strategy has a limited loss while maintaining a similar profit potential.
The suggested strategy manages the cost-efficiency aspect while also limiting potential losses. The decision-making process can then be based on market direction after the expected conditions begin to form.
In comparison to the original strategy in terms of profit and exit timing, the proposed strategy may offer a faster exit, whereas a butterfly setup may require waiting until expiration. However, traders may find early exits possible for condors or strangles.
Here is a visualization of the alternative setup:
Alternative Strategy Visualization
Thank you for reading. Wish you a successful options trading!
Nifty50 Trade Setup – February ExpiryAnalyzing the 7th Feb settlement prices using my proprietary OptionSigma model, a key level emerges: 23,698.80.
📌 Bullish Scenario: A clean breakout above 23,698.80 signals strength—potential long opportunities in Nifty February Futures or Monthly Call options.
📌 Bearish Scenario: Failure to breach this level? Shorting is the only play—either via futures or buying put options.
⚡ Stay sharp. Watch the price action around this level for confirmation!
#Nifty50 #OptionsTrading #IndexTrading #OptionSigma #FNO #TradingStrategy