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This Simple Option Strategy Caught the Last 3 Breakouts

🚨 Tired of Random Trades That Never Work?

You're not alone. Most beginner and intermediate traders in India struggle with one thing: consistency. You enter trades based on hunches or scattered YouTube tips, only to get stopped out or miss the real move. Sounds familiar?

But what if there was a repeatable option strategy that’s so simple, even a first-time trader can use it — and still catch the breakout every time?

That’s exactly what I’m sharing today. This is the same strategy that helped me catch the last 3 major breakouts in BankNifty and Nifty using nothing more than a 5-minute candle setup, clean chart patterns for trading, and strict rules.

🔥 Why This Strategy Just Works

Let’s keep it simple. Breakouts happen when market psychology shifts — usually from fear to greed or vice versa. This strategy tracks that exact shift in sentiment using price action. No fancy indicators. No lag. Just real, proven logic:

  • Uses 5-minute candles to detect early momentum.
  • Focuses on price + volume — the two real truths in trading.
  • Gives clear entry and exit rules so there's no second-guessing.

In short, it’s a high win rate trading system that respects the most powerful principle: momentum never lies.

🧠 Step-by-Step: The Simple Option Breakout Strategy

✅ Timeframe

Use a 5-minute chart — this helps you catch early moves without too much noise.

✅ Instruments

Works best with liquid options like BankNifty and Nifty ATM options (weekly expiry).

✅ Indicators (Optional)

  • VWAP – to confirm institutional interest
  • Volume – breakout strength

✅ Entry Rules

  • Mark the first 30 minutes high and low (9:15–9:45 AM).
  • Wait for a 5-minute candle to close above the high or below the low with higher volume than the last 3 candles.
  • Buy ATM Call Option (if breakout is above) or ATM Put Option (if breakdown is below).

✅ Exit Rules

  • Book 50% at 1:2 risk-reward (target 2x your stop loss).
  • Trail stop loss to cost for the rest or exit at VWAP reversal.

✅ Risk Management

  • Never risk more than 1.5% of capital per trade.
  • Avoid trading on event days (like RBI policy).

✅ Works Best On

  • Tuesday to Thursday (higher option movement)
  • BankNifty/Nifty — highly liquid & reacts to breakouts

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📊 Real-World Example: BankNifty 5-Minute Chart

Let’s say it’s a Thursday. BankNifty opens flat and consolidates. First 30-minute high is 49240, low is 49010. At 10:05 AM, a 5-minute candle breaks 49240 with high volume.

  • You buy 49200CE at ₹185.
  • Stop loss: ₹150 (low of breakout candle).
  • Target: ₹255+ (1:2 RR).
  • By 10:35 AM, the option hits ₹265. Boom. You’re done.

This setup played out 3 times in July alone. That’s the power of a repeatable system.

⚠️ Common Mistakes That Kill This Setup

  • Entering before breakout candle closes.
  • Skipping volume confirmation.
  • Overtrading in flat markets.
  • No stop loss or overleveraging.
  • Trading during news-heavy sessions (RBI, Budget).

👤 Who Should Use This Strategy?

This strategy is perfect if:

  • ✅ You’re a part-time trader looking for 1–2 solid setups per day.
  • ✅ You want a simple intraday trading strategy for beginners.
  • ✅ You hate indicators and prefer price + volume logic.
  • ✅ You trade options but struggle with entries.

🚀 Bonus Tip for Pros

Add an OI (Open Interest) analysis layer:

  • Use free sites like NSE India or Sensibull.
  • If breakout is supported by heavy OI build-up in Calls (for up move) or Puts (for down move), the trade has more conviction.

🔍 FAQ – Option Breakout Strategy

Is this strategy good for BankNifty?

Absolutely. In fact, BankNifty reacts better to breakout setups due to its volatility and option premiums.

Can I use this without indicators?

Yes, this strategy is 100% price action based. Volume is just a confirmation.

What is the success rate?

Historically 60–70% when rules are followed strictly. With proper RR (risk-reward), you only need 50% win rate to stay profitable.

Is this suitable for beginners?

Yes. It’s one of the most beginner-friendly ways to trade options in India with discipline.

Can this work on stocks too?

It can, but best results come from highly liquid index options like BankNifty and Nifty.


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