I’m net negative because of silver this year, but still positive on NIFTY. I mainly do positional options usually on NIFTY. Some selected ones:
- Dont catch the falling knife/Dont short a rising rocket
- Dont trade on smaller interval chart
- Can you handle being cheated by FIIs and not respond back? if you can, you won half the game
- Mandatory 1 hour gap after 1 intraday loss. End of day off after ___(a big amount) loss and Tomorrow off after ___(a big amount) loss - even if tomorrow makes a high ranged move, you’ll be making loss -trust me!!!
- You don’t have to take less probability trades or any trade at all. Take only high probability trades
- Don’t average
- Mind the delta!! Your highest losses are due to doubling the position sizes. You can’t handle negative delta. Corollary: During sudden moves against your position, better to exit early than later. Even if it reverses, the negative delta would hit your stops
- Gap? Usually it’ll reverse. But if it doesn’t, it may keep going in the same direction. Exit at second/third 3m candle.
- Do not repeat the same strategy after loss. If you were neutral before, don’t take another neutral trade after loss.
- Just because it’s so far doesn’t mean it won’t come close to it today. Markets can be irrational.
- You’re reading this, because you forgot all the lessons. So, do it like you mean it
Today’s gap is an excellent demonstration of my gap rule. All these insights are paid by my hard earned cash and pain. I still break most of the rules, but I managed to stop almost all revenge trades completely(point 3 and 4). That alone put me in profit with nifty for a few years… nothing decent though. It’s not really about following rules, it’s really about managing emotions.