Date of Publication :29th June 2023

Abstract: One of the most alluring positions for a derivatives trader is the straddle, whether they are long or short. As per the most recent SEBI India data, the majority of derivative traders are experiencing losses. On indexes like the S&P 500 or Gold, there are some methods that are researched by researchers for identifying strategies that can be used to maximise returns and advance decision-making. Finding the best approach to accurately identify an impending consolidation in an index is the key to the strategy of a short straddle's success. In order to maximise gains, this research paper identifies the precise entry and exit points for executing a short straddle in Bank Nifty index weekly options. The findings of the back testing indicate that the method can be successfully applied to previous signals, demonstrating historical success. This makes the findings important to other traders who might then use this in the market or researchers who could now conduct more research. When trading in the markets, a lot of people want such strategies to implement for consistent returns.

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