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I am holding 43200 weekly call option on Bank Nifty bought for around ₹228. Please let me know the important levels for this week – Karthik A R
The trend is bullish for Nifty Bank. It closed at 43,020 on Monday and the charts show that the index has short-term support at 42,900 and 42,600. There is a good chance for the index to rebound anywhere between these levels if there is a dip.
We expect the index to see a rally this week where it could potentially touch 44,000.
However, since you’re holding a weekly option, it will be subject to high time decay and the price can drop drastically if the index stays sideways even for one session. Therefore, our suggestion would be to rollover the weekly option to a monthly contract i.e., exit the weekly option that you hold and with those proceeds, you can buy a monthly option. In this case, you will have more time and can even hold the monthly option for a potential rally to 45,000.
But if you’re specific about holding the 43200 weekly CE, you can hold for now and exit at the prevailing price when Bank Nifty touches 44,000.
On the other hand, you should consider exiting at the prevailing price if the index falls below 42,800. Because such a drop means the rally towards 44,000 can take time resulting in the option price tumbling.
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