When Not to Buy Options 📊
Most beginners only learn when to buy CE or PE.
But smart option buyers also know when **not** to buy options.
Avoiding bad trades can protect more capital than finding one good trade.
Option buying needs momentum.
Without momentum, premium decay can silently damage your position.
------------------------------------------
✅ Do Not Buy Options in Sideways Market
Sideways market is dangerous for option buyers.
When price moves inside a narrow range, both CE and PE premiums can decay.
Signs of sideways market:
• Small candles
• Flat VWAP
• Low volume
• No follow-through
• Failed breakouts
• CE and PE both weak
No movement means premium decay.
------------------------------------------
✅ Do Not Buy Near VWAP Confusion
If price keeps crossing VWAP again and again, market has no clear control.
This usually creates choppy movement.
In this condition, option buyers often get trapped.
Wait for price to move clearly above or below VWAP with strong candle close.
------------------------------------------
✅ Do Not Buy Wick Breakouts
A wick above resistance or below support is not enough.
Many breakouts fail because price does not close beyond the level.
For CE buying, wait for candle close above resistance.
For PE buying, wait for candle close below support.
Wick breakout can become a premium trap.
------------------------------------------
✅ Do Not Chase Big Candles
A big candle may look exciting, but it can also mean you are late.
If premium has already expanded too much, risk becomes high.
Late entry creates poor risk-reward.
Wait for retest, pullback, or fresh confirmation.
------------------------------------------
✅ Do Not Buy Without Volume
Breakout without volume is weak.
Option premium expands better when participation is strong.
Before buying CE or PE, check:
• Underlying volume
• Candle close
• Option premium movement
• Option volume
• Follow-through
No volume means low-quality setup.
------------------------------------------
✅ Do Not Buy Far OTM Without Momentum
Far OTM options look cheap, but they need a strong fast move.
Without momentum, they decay quickly.
Cheap premium is not always a good trade.
For beginners, ATM or slightly ITM options are usually better than far OTM lottery trades.
------------------------------------------
✅ Do Not Buy Near Expiry Without Speed
Near expiry, theta decay becomes aggressive.
If market does not move fast, premium can fall sharply.
Expiry option buying needs:
• Direction
• Momentum
• Candle close
• Volume
• Premium confirmation
No momentum near expiry means premium decay.
------------------------------------------
✅ Simple Avoid Rule
Avoid option buying when:
**Sideways Market + Weak Volume + No Candle Close + Premium Overextended = Option Trap**
Better buying condition:
**Direction + Momentum + Candle Close + Volume + Premium Confirmation**
------------------------------------------
✅ Finally the Important point is;
👉 Do not buy options just because premium looks cheap.
👉 Do not buy because one candle looks exciting.
👉 Do not buy because of FOMO.
👉 Buy only when the market gives enough confirmation.
✅ Remember:
- Option buying needs speed.
- Theta punishes delay.
- Weak breakouts trap buyers.
- No setup = no trade.
------------------------------------------
Educational Purpose Only.
Most beginners only learn when to buy CE or PE.
But smart option buyers also know when **not** to buy options.
Avoiding bad trades can protect more capital than finding one good trade.
Option buying needs momentum.
Without momentum, premium decay can silently damage your position.
------------------------------------------
✅ Do Not Buy Options in Sideways Market
Sideways market is dangerous for option buyers.
When price moves inside a narrow range, both CE and PE premiums can decay.
Signs of sideways market:
• Small candles
• Flat VWAP
• Low volume
• No follow-through
• Failed breakouts
• CE and PE both weak
No movement means premium decay.
------------------------------------------
✅ Do Not Buy Near VWAP Confusion
If price keeps crossing VWAP again and again, market has no clear control.
This usually creates choppy movement.
In this condition, option buyers often get trapped.
Wait for price to move clearly above or below VWAP with strong candle close.
------------------------------------------
✅ Do Not Buy Wick Breakouts
A wick above resistance or below support is not enough.
Many breakouts fail because price does not close beyond the level.
For CE buying, wait for candle close above resistance.
For PE buying, wait for candle close below support.
Wick breakout can become a premium trap.
------------------------------------------
✅ Do Not Chase Big Candles
A big candle may look exciting, but it can also mean you are late.
If premium has already expanded too much, risk becomes high.
Late entry creates poor risk-reward.
Wait for retest, pullback, or fresh confirmation.
------------------------------------------
✅ Do Not Buy Without Volume
Breakout without volume is weak.
Option premium expands better when participation is strong.
Before buying CE or PE, check:
• Underlying volume
• Candle close
• Option premium movement
• Option volume
• Follow-through
No volume means low-quality setup.
------------------------------------------
✅ Do Not Buy Far OTM Without Momentum
Far OTM options look cheap, but they need a strong fast move.
Without momentum, they decay quickly.
Cheap premium is not always a good trade.
For beginners, ATM or slightly ITM options are usually better than far OTM lottery trades.
------------------------------------------
✅ Do Not Buy Near Expiry Without Speed
Near expiry, theta decay becomes aggressive.
If market does not move fast, premium can fall sharply.
Expiry option buying needs:
• Direction
• Momentum
• Candle close
• Volume
• Premium confirmation
No momentum near expiry means premium decay.
------------------------------------------
✅ Simple Avoid Rule
Avoid option buying when:
**Sideways Market + Weak Volume + No Candle Close + Premium Overextended = Option Trap**
Better buying condition:
**Direction + Momentum + Candle Close + Volume + Premium Confirmation**
------------------------------------------
✅ Finally the Important point is;
👉 Do not buy options just because premium looks cheap.
👉 Do not buy because one candle looks exciting.
👉 Do not buy because of FOMO.
👉 Buy only when the market gives enough confirmation.
✅ Remember:
- Option buying needs speed.
- Theta punishes delay.
- Weak breakouts trap buyers.
- No setup = no trade.
------------------------------------------
Educational Purpose Only.
⚠️Struggling with entry-exits, and risk management?
📈 Join Our Trading Community
Contact ⬇️
📱 wa.me/919322295961
⭐ Trading course
⭐ Indicators
⭐ F&O Trade ideas
Our New Telegram channel⬇️
📱 telegram.me/investyourasset1
📈 Join Our Trading Community
Contact ⬇️
📱 wa.me/919322295961
⭐ Trading course
⭐ Indicators
⭐ F&O Trade ideas
Our New Telegram channel⬇️
📱 telegram.me/investyourasset1
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
⚠️Struggling with entry-exits, and risk management?
📈 Join Our Trading Community
Contact ⬇️
📱 wa.me/919322295961
⭐ Trading course
⭐ Indicators
⭐ F&O Trade ideas
Our New Telegram channel⬇️
📱 telegram.me/investyourasset1
📈 Join Our Trading Community
Contact ⬇️
📱 wa.me/919322295961
⭐ Trading course
⭐ Indicators
⭐ F&O Trade ideas
Our New Telegram channel⬇️
📱 telegram.me/investyourasset1
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.