Real-time options education and strategies
Paul gave me these screenshots and asked me to finish the analysis. Here goes: Just before noon on Friday, Paul bought the 24SEPT 4425/4400/4375/4350 put condor in $SPX. He paid $3.00. The Put Condor has an especially effective risk profile. The position carried just -2.67 deltas, and had a $300 max loss and a $2,200 … Read more
Paul put on a nice new trade in $AMZN last week. We discussed it a little bit in real time on the Twitter feed, but the trade deserves a more thorough breakdown because it contains a lot of good lessons about price action and trade structure. Paul gave me a set of screenshots and asked … Read more
(1) Looking at the overnight action in /GC (Gold futures). Textbook price action so far this evening starting with the bullish reversal candle labeled #1. It was a relatively large candle with a long lower wick. That type of candle indicates that there was a change in sentiment where sellers had been in control but … Read more
I have some older content that I don’t have in any post so that’s all getting dumped into this post. I hope you find it worthwhile. 2021-08-16 Monday (1) I established a bearish position in SPX on Friday afternoon by buying Sep3 Put Vertical Debit spreads. I already own some DH’d bullish positions in Oct … Read more
Note: I added an update at the end so make sure you read the entire post! If you listen to most ‘experts’ they’ll tell you to spread out your risk by placing many smaller trades to reduce your exposure. I used to do that until I realized that was exactly the wrong advice for me. … Read more
In the past I’ve highlighted many times the importance of the 8 and 20 SMA bands for analyzing price action. I’ve just recently introduced you to the 1.5 standard deviation 20 SMA Bollinger Bands. The Bollinger Bands can add another dimension to your analysis because many of the strongest directional moves occur well away from … Read more
Below are the building blocks for a two trades; the Condor and the RS+. Positions can be built through multiple transactions or they can be initiated as a completed spread. Starting with just the long option allows for the fastest Delta Hedge towards a zero cost position because it takes the greatest Delta risk at … Read more
The Condor is one of the most powerful option strategies for generating a very favorable reward/risk ratio. It can offer generous amounts of long (positive) Theta as well as short (negative) Vega. Being short Vega tends to reward a position where the underlying instrument’s price grinds higher. That is why I often utilize an out-of-the-money … Read more
Lots of traders like to day trade. Some like to swing trade. Most don’t know how to decide between the two. So here’s a thought; how about I let the price of the underlying instrument determine that for me? How’s that work? Read on and you’ll find out! On that risk profile (above) of day … Read more
This post is going to demonstrate how I use Call Condors to initiate longer-term (typically 3 months to 1 year) positions with relatively little directional risk when the trade is first placed. It is a trade that is designed to profit from a trending stock. If you look at the Thinkback chart and risk profile … Read more