When I started my trading career almost 6 years back, I didn’t even know what was nifty future and why people traded nifty and not sensex. After going though few years of learning experience I saw that Nifty future was the better instrument to trade. However I did mostly intraday trading then.
From my personal experience if you apply technical analysis to nifty future, you will find that nifty future is in your control and most of the time you will predict correct moves. What I want to say is Nifty future react to technicals very well. But many times, even though traders are right to predict small moves in nifty but unable to make most of it.
So this made me to do some more research and finally came up with a solution. Solution is very simple, do your technical analysis on Nifty future and then take the positions on bank nifty future. Just for example: If nifty future is trading at support level and most likely to bounce then I will take long positions in Bank nifty future exactly when nifty future approaches support level. As bank nifty future has high beta so more movement will be seen in Bank nifty future than nifty future. Hence making maximum gains from technical analysis on nifty future.
About
Hi,
Practically your view is right but Bank Nifty is different Index and its Beta value is also 1, yes we can say icici bank is high beta share comparison to bank nifty.
Regards
Umang
Sir, I have used this strategy many time for intraday. If you look at bank nifty future and nifty future, You will see that these two index are highly correlated to each other. Correlation coefficient being about 0.92 so no matter even if bank nifty and nifty future are different index, but they will move in same direction for most of the time.
NIfty and Bank Nifty are like husband and wife they dont get separated. Majority of the days both will in same direction and co-related.Only on RBI news like Inflation data release,IIP data release and many others and sometimes global news like bankruptcy makes Bank nifty to come low,otherwise both will not get separtaed.
You got it right Vandhana, Nifty and bank nifty future has very high correlation. So most likely they will move in same direction.
bhaveek bhai,please guide as i am trapped.shorted zeel august future@155 on 25th july,now quoting around 160,kindly advice as it is trading around 157.50 to 164 from last 2-3 days,have seen 2 weeks data it is at high trading at high,can i get my shorted price,please help with your analysis,waiting,thanks.
Hi jack, I am on Holidays till 15 August, cant assists you with it.
I’m new in stock market
Hi Mohit, you will need to learn the basics of stock market and process of trading.
data feeder is feeding spurious data.
Want to see trayl service and then is it ok ,i will join
But only nifty and bank nifty
hi, i need to learn intraday trading