Absolutely. For NIFTY option selling, I’d use a fixed two-stage process:
Pre-market analysis → form a preliminary bias and identify important levels.
After 15 minutes → confirm or reject that bias using actual price action, volume, OI and option-chain behavior.
1. PRE-MARKET NIFTY ANALYSIS — Before 9:15 AM
Step 1 — Check Global Market Sentiment
Check:
GIFT NIFTY
US market closing
Nasdaq
S&P 500
Dow Jones
Asian markets
Major overnight news
Purpose: Determine whether NIFTY is likely to open with a bullish, bearish or neutral sentiment.
Step 2 — Check Previous NIFTY Day
Record:
Previous day's Open
Previous day's High
Previous day's Low
Previous day's Close
Previous day's range
Where did NIFTY close relative to the day's range?
Then identify:
Previous Day High (PDH)
Previous Day Low (PDL)
Previous Day Close (PDC)
These become important intraday reference levels.
Step 3 — Identify Major Price-Action Levels
On the 5-minute chart, mark:
Previous Day High
Previous Day Low
Previous Day Close
Recent swing high
Recent swing low
Important support
Important resistance
Gap-up/gap-down zone
Major H-levels
Don't mark too many levels. Focus on levels where price previously reversed, rejected or consolidated.
Step 4 — Check NIFTY Futures
Look at:
Futures price
Futures premium/discount
Change in futures price
Futures OI
Long buildup
Short buildup
Long unwinding
Short covering
A simple interpretation:
Price ↑ + OI ↑ → Long buildup
Price ↓ + OI ↑ → Short buildup
Price ↑ + OI ↓ → Short covering
Price ↓ + OI ↓ → Long unwinding
Step 5 — Check India VIX
Record:
India VIX = ____
Then classify volatility.
Below 15 → Low volatility
15–20 → Moderate/normal trading environment
Above 20 → High volatility
For option selling, don't look at VIX alone. Combine it with price action + expected move + event risk.
Step 6 — Analyze NIFTY Option Chain
Check ATM and nearby strikes.
For example, if NIFTY is around 24,000:
Calls: 23,800 / 23,900 / 24,000 / 24,100 / 24,200
Puts: 23,800 / 23,900 / 24,000 / 24,100 / 24,200
Record:
Call OI
Call OI change
Put OI
Put OI change
Highest Call OI
Highest Put OI
Call unwinding
Put unwinding
Fresh Call writing
Fresh Put writing
Step 7 — Calculate/Check PCR
Check:
PCR = Put OI ÷ Call OI
Don't use PCR as a standalone buy/sell signal.
Use it together with OI change and price action.
Step 8 — Find Option-Chain Support & Resistance
Example:
If there is strong Put writing around 24,000:
→ 24,000 may become an important support.
If there is strong Call writing around 24,200:
→ 24,200 may become an important resistance.
But verify these levels after market opening because OI can change quickly.
Step 9 — Check Events
Before taking an option-selling position:
RBI announcement?
Fed event?
Inflation data?
GDP data?
Major global event?
Budget/event day?
Expiry?
Major corporate/news event?
Event day = adjust risk substantially.
Step 10 — Create Preliminary Bias
Now classify NIFTY:
š¢ Bullish
Conditions may include:
Positive global cues
Strong futures
Support holding
Put writing
Call unwinding
Higher-high/higher-low structure
š“ Bearish
Conditions may include:
Negative global cues
Weak futures
Resistance rejection
Call writing
Put unwinding
Lower-high/lower-low structure
š” Neutral/Range
Conditions may include:
Price between major levels
Call + Put writing
Low volatility
No strong directional catalyst
Repeated rejection from both sides
Important: Pre-market bias is only a hypothesis, not your final trade signal.
2. FIRST 15-MINUTE ANALYSIS — 9:15 to 9:30
This is the most important confirmation stage.
Step 11 — Observe the Opening
Don't immediately trade.
Observe:
Gap up?
Gap down?
Flat opening?
Gap filling?
Strong buying?
Strong selling?
Immediate rejection?
Mark:
9:15–9:30 High
9:15–9:30 Low
This becomes your initial opening range.
Step 12 — Study the First 3 Candles
On the 5-minute chart, analyze the first three candles.
Look for:
Large bullish candles
Large bearish candles
Long upper wick
Long lower wick
Doji
Rejection
Inside candle
Breakout
Failed breakout
The wick + closing position is particularly important.
Step 13 — Compare Price With Your H-Levels
Ask:
Did NIFTY respect the level or break it?
For example:
Resistance:
Resistance → Price → Rejection
Potential bearish signal.
Or:
Resistance → Breakout → Retest → Hold
Potential bullish signal.
Don't sell just because price touches resistance.
Step 14 — Check VWAP
After 15 minutes:
Price above VWAP
Price below VWAP
VWAP rejection
VWAP reclaim
VWAP + support alignment
VWAP + resistance alignment
A useful framework:
Above VWAP + higher highs → bullish
Below VWAP + lower lows → bearish
Around VWAP → potentially choppy
Step 15 — Check Volume
Compare the opening volume with recent candles.
Look for:
Price breakout + strong volume
versus
Price breakout + weak volume
The second situation can indicate a potential false breakout, but it requires confirmation.
Step 16 — Recheck Option Chain
Now compare the option chain with your pre-market data.
Ask:
Did the OI confirm the price movement?
For example:
NIFTY rising + Put OI increasing + Call OI decreasing
→ bullish confirmation.
NIFTY falling + Call OI increasing + Put OI decreasing
→ bearish confirmation.
But remember that OI interpretation should be combined with option prices and underlying price action.
Step 17 — Check PCR Again
Compare:
Pre-market PCR → 9:30 PCR
Ask:
PCR increasing?
PCR decreasing?
Significant change?
Is price confirming the change?
Don't trade based on a single PCR number.
Step 18 — Identify the Actual Trading Range
By 9:30, identify:
Support = ______
Resistance = ______
Opening Range High = ______
Opening Range Low = ______
VWAP = ______
Major H-Level = ______
Now you have a much clearer map.
3. FINAL BIAS AFTER 15 MINUTES
Use this decision structure:
š¢ BULLISH BIAS
Prefer bullish/put-selling setups when:
Price above VWAP
Higher-high/higher-low structure
Important support holding
Put writing/Put OI support
Call unwinding or weak Call resistance
Opening-range high gets accepted/broken
Volume confirms movement
Action: Look for a Put-selling setup, preferably after a suitable reversal/retest rather than blindly selling immediately.
š“ BEARISH BIAS
Prefer bearish/call-selling setups when:
Price below VWAP
Lower-high/lower-low structure
Resistance holding
Call writing
Put unwinding
Opening-range low breaks
Volume confirms weakness
Action: Look for a Call-selling setup after confirmation/retest.
š” NEUTRAL BIAS
If:
Price is trapped between support/resistance
VWAP is flat
Both Call and Put writing are strong
No clear breakout
Candles are overlapping
Volume is weak
Action: Avoid forcing a directional trade.
This is particularly important for option sellers because choppy markets can look attractive due to premium decay but can suddenly expand in volatility.
4. YOUR COMPLETE NIFTY CHECKLIST
Use this every morning:
PRE-MARKET
Global markets
GIFT NIFTY
Previous-day OHLC
PDH
PDL
PDC
Major support
Major resistance
H-levels
NIFTY futures
Futures OI
India VIX
Option-chain Call OI
Option-chain Put OI
Call OI change
Put OI change
PCR
Major events
Expected opening
Preliminary bias
9:15–9:30
Opening type
First 3 × 5-minute candles
Opening-range high
Opening-range low
VWAP
Volume
Price structure
H-level reaction
Support/resistance reaction
Option-chain change
PCR change
Futures/OI confirmation
Breakout or rejection
Final bias
BEFORE OPTION SELLING
Is the direction clear?
Is price at a logical level?
Is there confirmation?
Is volatility suitable?
Is the strike sufficiently away from spot?
Is there a defined SL?
Is there a defined target?
Is the risk/reward acceptable?
Is there an event risk?
Is the setup better than simply staying out?
The most important rule
Don't predict NIFTY from pre-market data.
Use:
Pre-market = PLAN
First 15 minutes = CONFIRMATION
Price Action = FINAL DECISION
For option selling, the sequence should ideally be:
Level → Price reaction → VWAP/structure → Volume → Option-chain confirmation → Entry → SL → Target
This will prevent you from taking a trade simply because PCR, OI, or global cues "look bullish."
Reviewed by Admin team
on
August 22, 2026
Rating:
