Real-time options education and strategies
This post is about the smaller account that I manage for somebody. The positions are smaller and easier to understand than my positions which don’t seem that helpful for demonstrating good trading techniques! 😄 On twitter I refer to it as the PDT account. PDT is short for Pattern Day Trader and if you don’t … Read more
There are plenty of references to the RS+ trade on the blog and in my twitter feed. It’s certainly one of my favorite option structures. Basically, a RS+ is a version of a 1×2 (or 1×3) Ratio Spread in one expiry plus 1 (or 2) long options in a later expiry. It could also be … Read more
Over the years I’ve developed my own methods of analyzing price action and that has helped me stay on the right side of the trade most of the time. Of course there are going to be failures along the way that aren’t necessarily due to a misreading of the chart but rather a news events … Read more
Friday, Sep2, could, in retrospect, be an important day in revealing a clue to the next directional move in /ES (S&P 500 index futures) and the other stock indexes. The low of Thursday (#2), Sep2, was 3903.65 and price rallied strongly closing near the high of the day leaving a relatively long lower wick and … Read more
Yesterday I tweeted that there was an opportunity to add long /ES (bullish) Deltas on the potential 30-minute bullish reversal. The buy zone was 3971-74 and the stop was 3964.50. That’s 10 points of risk. That’s important because I didn’t know that it was a bullish reversal, only that it had the potential to be … Read more
Even though K.I.S.S. stands for Keep It Simple Stupid it’s not my intention to refer to anyone reading this post as stupid! It’s a reminder to all, myself included, that we can often make things more complex than they really have to be. In this post I’m going to present a potential trade that was … Read more
That was quite the bullish reversal last week! Below is the SPX daily chart. The green, yellow and red lines represent last year’s high, HB (Half-Back or midpoint) and low. For weeks now I’ve been expecting SPX to reach 3662 because that was last year’s low and price had already dropped below the 61.8% retracement … Read more
I’ll pass on many average setups to wait for a good setup. What’s a good setup? I have several tools that I use to identify good location for a trade; the upper or lower band of the 8 SMA is one, the High, Half-Back (HB), and Low of a prior period (hourly, day, week, month, … Read more
I’m a trader. My trades can last anywhere from 30 minutes to 30 weeks so I don’t need to add my opinion as to whether or not ‘the low‘ is in for the market or not. Doesn’t really matter to me. It’s a concern for long term investors but again, that’s not me. That doesn’t … Read more
When I trade any short term time spread in SPX or SPY I almost always use the 3-day rule. When I say short term I mean that the expiration of both the spread’s short and long options is generally within the following 30 days. The 3-days refers to the amount of days between the expiration … Read more