In my OEX trading over the past several weeks I’ve had personal extraordinary success, with daily returns in my personal journal of 11 wins at 33% average, and one loss at 50%.
Just prior to that I had several weeks where I simply did not trade, uncomfortable with the market moves and lack of VIX volatility, and then I “felt” it time to trade and had these wins.
I fall in love with an option. This is the most important option secret I teach, that few ever truly follow.
I watch it as I trade it, noting the bid/ask, but trading it around support and resistance lines, and recalculating my Pivot Point analysis.
I watch the volume, the times it moves, where it moves, and I begin to build inventory. Remember, that’s how I see it…fruit to be traded.
Using ATR, Pnf charting, and Dow Projections many of the stocks we own are tradable as options. We do not do complex covered calls, or butterflys.
If we are serious on a stock, we buy the option, and perhaps the stock.
But when we are short term trading, or day trading a stock or index, we are trading one option, and trading against other traders that are also buying and selling the same option. This is a game of bid/ask, nothing more than a card game, if trading an index.
The merit of how simple this correlation is (the odds are stacked against you) is how to make simple and fast trades on tight movements
Do not think long term. Have your investments, make sure they are sound, and do not watch them. Invest only what you can risk to trade, and that which you know is your “limit”. There are ratios one can analyze, but I find if our traders keep diversified portfolios, often with our Blue Chip holdings, and trade “investment and risk money” in their option trading, whether it be long term LEAP Options (the least risky) to any OEX or SPX option, or an option on any stock.
Check the website, subscribers. Many do not take advantage of how I teach, making note……..you are free to write to me and I will personally respond.
