Current Trading Strategy on NIFTY Nov Fut @ 6232.55 on 11 Nov 2010

As I had said on 08 Nov 2010 that NIFTY is Looking volatile from 100 to 150 points on downside and NIFTY became down -81.45 Points in Spot and -75.75 in Future today. Current Level in NIFTY Spot is 6194.25 & NIFTY Nov Fut 6232.55 on 11 Nov 2010. If we see the movement from 05 Nov 2010 to 11 Nov 2010, its clearly indicates that Market is Conservatively Bullish means Investor is concerned about near term down risk. It is sure that market will breakout from its high level in coming months but firstly it will consolidate between 100 - 150 Points down & up both side.

NIFTY  movement from 5 Nov 2010 to 11 Nov 2010

So we can take following Trading Strategy in NIFTY :-

Collar means, Buy Stock/Index + Buy *OTM Put + Sell *OTM Call

*OTM :-  Out -of the- money

Buy NIFTY Nov Fut @ 6200 - 6230(according to risk level) with Target of 6300 - 6330(according to risk level) Stop Loss is 6175 + Buy NIFTY 6100 Put @ Rs. 37.25 + Short NIFTY 6400 Call @ Rs. 21.10 with the stop loss of Rs. 35 - 40 (according to risk level).