After the downtrend and the prolonged consolidation Nifty breaking out to the upside

The previous entry in this blog series was on July 2nd, when we initiated our first bullish position for the July series. This position was gaining profits nicely until July 7th. However, on July 8th, Nifty plummeted due to new war-related news, closing the day with a 520-point drop at 23,882, significantly below our reversal trigger point of 23,983. The decline was so steep that we refrained from taking a short position that day, opting to wait for a pullback, which occurred the following day. On July 9th, as Nifty edged higher, we reversed to a bearish position by closing the existing 4 lots long future, opening 4 lots short future at 24,030, and simultaneously opening 8 lots short 23,900 monthly put options. This move resulted in a realized loss of Rs 59,800 in our trading account.

Subsequently, the bearish momentum ceased, and Nifty entered a consolidation phase with a mild bullish inclination for six trading sessions until 16th July. On 17th July, yesterday, the range was breached on the upside as Nifty closed at 24334, advancing 261 points above the previous close, surpassing the EBL/EBR channel. This strength was validated by the MHAF chart, which displayed a robust bullish green candle.

As observed earlier, the MHAF spreadsheet indicated a buy trigger for yesterday at 24255, which Nifty surpassed by closing significantly higher. This development has invalidated our earlier bearish outlook, and we are now prepared to reverse our position once more (for the last time in this monthly series) when the predetermined level of 24413 is exceeded on the upside.

Once the level surpasses 24413, we intend to close out the short futures, accepting another round of losses, and then go long again while simultaneously shorting 8 lots of 23500 call options. This final strategy in the current series will provide us with an exit point at 24627, either before the expiry with a minor ultimate loss or allowing us to break even with no profit or loss if the Nifty expires near that value on 28th July.

This month has been challenging for this strategy due to significant fluctuations in both directions. Ultimately, breaking even would be a significant accomplishment. Even a small profit would maintain a streak of non-losing months for this strategy since December 2025.

Cheers and happy trading.