Intraday Option Selling Part 2 | Rule Based Option Trading

We continue our conversation on intraday options selling with Python Trader popularly known as 'Saddy' by his Twitter followers.

He speaks about picking options trades based on price action-based range breakouts. He uses initial balance of highs and lows. He identifies a relevant trading structure to pick these range breakouts. A structure is relevant when a buyer or seller has pushed the prices more than 50% of the initial movement.

He follows a strict stoploss and exits his position when his loss exceeds risk per trade points. If it’s a Thursday then he books losses only in the option which is losing money and keeps the profitable option open since it can go to zero.

He speaks of three ways for strike selection.
1. Candle based - Where you calculate risk per trade point and select the option
2. Bullish and Bearish Strangle – Where you sell ATM and OTM strike options
3. Debit spread- Where you will buy ATM strike and sell OTM strike options

He believes directional trading is psychologically draining. So he merges it with non-directional trading.

He also speaks of risk management and position sizing in detail. We’re certain that this episode will benefit options traders.
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About Python Trader
Python Trader known as 'Saddy' by his Twitter followers has been trading options since 2017. He works in a bank and likes to keep his identity private. You can follow and interact with him on his Twitter id @pythontrader999.
He is a rule-based options trader. He is from a non-technical background. But still managed to automate his trading strategies with the help of developers. Algorithmic trading helps him to concentrate on his day job but still trade in the markets on an intraday basis.

About The Right Choices with Oracles of Dalal Street :
The Right Choices with Oracles of Dalal Street is hosted by Apurva Sheth. He is the Chief Markets Editor at Samco. He has more than 11 years of experience in financial markets.
Our show focuses on curating actionable and insightful strategies from real-world stock market heroes. Our guests have been successful in markets and are willing to share their insights with you.

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