Nifty Options Trading using Keltner Channel, Volume profile & KST indicator

Options trading requires understanding of momentum. The best indicator to measure this is using Keltner Channel along with KST indicator.

Which are the Powerful Indicators to use for Options buying?

Below chart shows application of 3 powerful indicators – Keltner Channel, Volume Profile and KST momentum indicator. Each of these have its own merits.

Nifty 22500 PE 25^th April 2024 expiry:

Nifty 22500 Put Option shows application of Keltner Channel, Volume Profile and KST on 15 minutes time frame.

Volume profile – This indicator helps to understand the area where major volume has taken place. We can see that 200 is the level where lot of activity has happened in this option price. After gap up on 15^th April, prices came to retest the volume profile area and also mid of the Keltner channel. This was the classic opportunity to enter on the long side of 22500 put options for the trend to resume on upside.

Keltner channel – shows the possible area of breakout. Currently prices are moving down along with Keltner channel. We need a break in options price above 300 which is mid channel followed by 341 that will confirm opportunity to buy again for positive trend. On downside 200 volume profile area is going to remain strong support zone.

KST indicator - this indicator is a very powerful time indicator and it measures if the momentum is building up or slowing down. Currently the same indicator is now moving below the 0 line suggesting lacklustre movement and this is also in sync with Keltner channel.

In short, as soon as Nifty put options prices give breakout above 300 levels we can get good options buying opportunity for a trend to 400 which is previous price action area.

In a nutshell, one can combine 3 powerful trading indicator to trade options directly.

TRISHUL - Options Mantra – (OM) with Sutra of Waves (SOW) Learn the science of Trading Options using 5 powerful mantras in upcoming Options trading program on 27^th – 28^th April 2024. Elliott wave  with Neo wave, Ichimoku Cloud with Fibonacci Trading system in Sutra of Waves (SOW) scheduled on 1^st – 2^nd June 2024. Methods can be applied directly on stocks or on the Options chart. Limited seats only

Nifty Elliott wave with KST Momentum indicator – BANG ON!

 Elliott wave is the GPS of the market that helps to understand the overall maturity of the trend and also provides confirmation if there is a reversal in vicinity.

Below is the chart of Nifty which was shared on 10^th April 2024 much before the fall started when prices were trading near 22700 levels.

Nifty chart - anticipated on 10^th April:

Nifty happened: as on 16^th April 2024

Nifty has moved sharply lower and the forecasting of the down move was done much before the fall in US stock market DJIA and also before the Israel war news. Following was mentioned on 10^th April 2024:

Anticipated - Nifty GPS Elliottwave counts with channel and KST indicator all suggesting matured stage of up move with major #Gann hurdle at 22877, KST failing to show momentum breakout and trendline resistance, ALERT!

Happened: Nifty moved precisely as expected and prices reversed down to making a low of 22100 already. The move on downside has been sharp and fast which is in lines with Elliott wave outlook. 

Prices completed wave 3 higher and reversed down as momentum failed as shown by KST indicator along with trendline resistance. Elliott wave already confirmed wave 3 to be near completion within the Ending Diagonal or terminal pattern.

Support on downside is near 21980 which is the area where ongoing wave 4 can complete and then again a pullback on upside is possible. However, breach below 21710 will indicate bigger downside correction.

Do note the above chart is as per Elliott wave and not Neo wave.

In a nutshell, above research highlights simple Elliott wave application and how it helped to capture medium term reversal on Nifty almost near the top of 22700 much before any news or events!

TRISHUL (Options Mantra +Elliott wave + Neo wave) – Learn the science of Trading using simple concepts of Volume profile, Supertrend, Price action, Keltner channel breakout, KST momentum indicator (5 Mantras of Options trading) scheduled on 27^th – 28^th April and combine with Elliott wave, Neo wave scheduled on 1^st – 2^nd June. Limited seats only, fill below form for more details:

 

 

Trading two Powerful Indicators - Supertrend and Volume profile

 Trading requires application of Technical analysis methods. Two powerful indicators that we use is Supertrend combined with Volume profile to see big trader’s activity.

Elliott wave helps to understand maturity of trend, supertrend is classic trend following method and volume profile provides area of reversal or big players activity zone.

Nifty hourly chart

As shown in above chart, after forming a top near 22760 area prices reversed on downside. We have also hinted in earlier research using Elliott wave – Neo wave that the up move is matured and should probably reverse on downside.

Supertrend – The reversal as per Elliott wave was further confirmed when prices broke below hourly supertrend indicator and continued to sustain below that. This indicator uses Average true range concept to derive the levels. It suggests if there is significant move in opposite direction and the trend has reversed. We can see red line formation above the prices suggesting that as long as Nifty futures are trading below 22493 overall tone will remain bearish with sell on rise method.

Volume profile – This indicator helps to understand the area where big traders have created their positions. We can clearly see that 22600 (futures) is the major hurdle on upside as the volumes have been significant there and on downside 22100 (futures) is important support zone. So, this can be the zone of pause for the current down move.

In a nutshell, Nifty trend remains sell on rise unless we see close supertrend and any change in volume profile will further indicate if the big traders positions are now changing.

Thus, one can use this simple indicator to ride the trend and especially options traders will have an upper edge over others when combining this technique of trend following along with Elliott wave – Neo wave techniques.

TRISHUL (Options Mantra + Elliott wave + Neowave) – Learn the science of Trading using simple concepts of Volume profile, Supertrend, Price action, Keltner channel breakout, KST momentum indicator (5 Mantras of Options trading) scheduled on 27^th – 28^th April and combine with Elliott wave, Neo wave scheduled on 1^st – 2^nd June. Limited seats only, fill below form for more details: 

Gold at Lifetime High, crossed 71K! What's Next?

 In today’s session, Gold made new life time high near 71080 levels. Gold is following its own independent Elliott wave pattern and Time Cycle. We predicted this up move even before the rally started using Time cycle and Elliott wave theory.

Look at below the charts and detailed research on MCX Gold taken from our Monthly research report which we published in March 2024 – “The Financial Waves Monthly update” 

MCX Gold Weekly chart Anticipated as on 19th March 2024

MCX Gold Daily chart Anticipated as on 19th March 2024

 MCX Gold Daily chart with 51 Days Time cycle Anticipated as on 19th March 2024

Wave analysis as on 19^th March 2024

During the month of February Gold showed movement in both the direction. However, at the start of March 2024, Gold finally gave a breakout of the Triangle pattern. After which we saw a sharp rally in Gold which led prices to make fresh record high near 66356 levels. Gold moved precisely and managed to achieve out targets of 63300 and moved above it. We have successfully captured this rally of more than 8%.

We are seeing magic of Time cycle! As we mentioned in the previous report that a breach above 62700 will turn cycle on the buy side. Prices moved up precisely from it. Since the start of March 2024, we have witnessed rise of more than 6% in Gold. The sharp rally that we saw is majorly due to Fed rate cut speculation, profit booking in US bond fueled the rally!

On the Weekly chart, we can see Bollinger Bands® have started expanding and prices have recently given a breakout of the upper Bollinger Bands. In the previous week, prices gave a close above previous week’s candle high which is a positive sign. This keeps weekly tone on the positive side.

We have plotted 51 Day’s Time Cycle which has helped to determine crucial reversal areas. We can see prices made low exactly on our cycle near 61190. Since then, we saw a sharp rally of more than 8% in Gold. The next cycle is due by 23^rd April 2024. Until then we can expect Gold to continue to shine!!!!

In nutshell, Overall tone for Gold looks positive. Therefore, accumulating gold at current levels in a staggered way can be a systematic strategy to ride the trend with the targets of 66400. Avoid catching tops and use dips as a buying opportunity for a move towards followed by as long as 63800 holds on the downside.

MCX Gold Happened as on 8^th April 2024

Happened: Gold moved precisely in sync of our expectations. Prices achieved our target of 66400 and moved way above it and made life time high near 71080 levels. We have captured this up move of more than 8% in less than one moth.

We have been mentioning about reversal in Gold since past 2 months in our Monthly research reports. We have successfully captured this entire rally of more than 15% from Time cycle low which was near 61190 levels.For now, one can use buy on dips approach to ride the trend as long as as 69900 holds on the downside.

TRISHUL (Options Mantra + Elliott wave + Neo wave) – Learn the science of Trading Stocks and Options Mantra (OM) with 5 Mantras of Supertrend, KST, Price action, MA crossover system, Keltner Channel, Volume & OI profile scheduled on 27^th – 28^th April & Sutra of Waves (SOW) covering Elliott wave, Neo wave with Ichimoku Cloud, Fibonacci trading system scheduled on 1^st – 2^nd June 2024, Early bird ends on 10^th April, Limited seats

Nifty Trading KST momentum indicator with Keltner Channel Breakout

Trading KST momentum indicator with Keltner Channel are two powerful indicators to trade Options.

Using momentum indicators along with breakout techniques that can help in capturing the entire up move is important.
Nifty 15 minutes chart:

In above chart of Nifty we can see two important indicators that are focused on prices and momentum.

Keltner channel – This indicator is different than that of Bollinger Bands®. Bollinger Bands uses standard deviation to the mean whereas Keltner channel is derived using Average True Range (ATR). Both of the indicators have different way of application.

In Keltner channel we can see that break above upper channel on 28^th March which was the 1^st break above the upper channel of Keltner. Post that prices showed strong trend higher.

KST momentum – Breakout on Keltner channel was also accompanied by KST momentum indicator. KST momentum indicator broke above the signal line thereby giving strong confirmation that momentum was picking on upside.

In entire up move prices have not moved below the lower Keltner channel and KST if now again moves back above the signal line it will indicate a positive reversal. This can be a pause before the resumption of uptrend but a classic signal can be expected when both these techniques again get synchronized.

In a nutshell, Keltner channel helps to understand if the size of candle is increasing which is suggesting a significant move and KST further provides confirmation of momentum. Price action above 22500 which is upper channel will result into another synchronous signal from these indicators.

TRISHUL - Become Market Wizard (BMW) – Learn the complete application of Keltner channel along with KST indicator, Supertrend, Moving average crossover system and Price action as 5 Mantras in upcoming 27^th April – 28^th April 2024 Options Mantra (OM) program and Sutra of Waves (SOW) covering Elliott wave, Neo wave along with Ichimoku Cloud. Early Bird ends on 10^th April, Limited seats only. Fill below form for more details