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How To Lose Money With CONFUSION (timeframe mixing) The issue for many new traders is understanding the correlation between timeframes. We often get caught up in indicators, news hype, chat room posts, and various other things. One of the biggest challenges I see when talking to new traders is simply the lack of "experience" in reading multiple timeframes. This causes confusion and even self-doubt. The issue with the internet being so vast is there is a lot of info - but what do you go with & why? In this post I have tried to "dumb it down" - the simple idea is to pick your timeframes based on your trading style. Now if work gets in the way and you need to trade end of day or even swing (Longer-term) then really, you shouldn't stress so much about a 15 minute candle. A lot can happen throughout the day. But on the opposite side of the spectrum, if you are sat in front of your screen every minute the market is open. (scalping) then trying to work out what the monthly is doing whilst you hold a trade for an hour is not going to affect your trade (in general). To give you a great example of this - I trade COT data as it's swing, with Monthly and weekly bias. I will have a mentee say something like "COT is a buy, but the price has dropped". Yes if you're looking at the 4-hour candle. If you think what institutional players can manage in terms of drawdown, especially using hedging techniques. It's far greater than the guy investing £5k of savings into Bitcoin. If a hedge fund buys Bitcoin at 45k and the price drops to 22.5k - the likelihood is they have a hedged position & will be buying it all back at fair value. Whereas Mr £5k has lost some sleep & half of his capital - bailed, only to see the price shoot back up above his original entry. You think of someone like Elon Musk - if his entry of a Billion Dollars was at 40k (example) and price drops to 20k, he has a paper loss of 500m for sure, it will hurt. But again if the Tesla share price drops from 800 to 700, he has a paper loss of (say 20 Billion) - a 500m loss on paper is less of a concern. *** You get the picture. Investors & traders know that things don't just moon! they have dips, impulsive moves and so on. So take the charts into account - You have an idea of what timeframes to pick based on your own personal availability or your style you have already identified. As a scalper it's easy to use 4 hour or even a 1 hour candle for your bias - a 15minute for a local area of interest & an entry on a 1m - 5m chart. (example only). If you trade swing trades (depending on the overall time & expectations) a weekly bias, a daily interest and a 4hour trigger could be what you look for. Here are some examples; In these examples - all I have done is used 1 tool. This is only to show the idea - If stochastic is up then I want to be Bullish, if down I'll consider Bearish moves. Keep in mind this could be anything from above/below a moving average, a key price level or a magnitude of other things. Even other tools like RSI for example. Example of step down The idea is this gives you a directional bias. Then we look at the area of interest. And finally - we want to look down on the next timeframe for the trigger (entry) Traders can easily get confused with one timeframe saying one thing and the next timeframe up or down saying something else. If you can treat it like a tick sheet, you can step down with confidence and work on a strategy favouring your directional bias & that's in confluence with the time period & your expectations. This really is an oversimplified breakdown. Just to give a general idea. Have a great week! Disclaimer This idea does not constitute as financial advice. It is for educational purposes only, our principle trader has over 20 years’ experience in stocks, ETF’s, and Forex. Hence each trade setup might have different hold times, entry or exit conditions, and will vary from the post/idea shared here. You can use the information from this post to make your own trading plan for the instrument discussed. Trading carries a risk; a high percentage of retail traders lose money. Please keep this in mind when entering any trade. Stay safe.
Education
by Mayfair_Ventures
10
A Quick intro to Moving Averages (Beginners) I have recently had some questions on some of the basics such as moving averages. First of all, there is some great free content out there via sites such as Babypips I wanted to share some simple info to at least explain what a moving average is. Where it is used and what are the types of. Moving average is a simple, technical analysis tool. Moving averages are usually calculated to identify the trend direction of a stock or to determine its support and resistance levels. It is a trend-following—or lagging—indicator because it is based on past prices. They also form the building blocks for many other technical indicators and overlays, such as Bollinger Bands, MACD and the McClellan Oscillator. The two most popular types of moving averages are the Simple Moving Average (SMA) and the Exponential Moving Average (EMA). Moving averages are a totally customizable indicator, which means you can freely choose whatever time frame they want when calculating an average. The most common time periods used in moving averages are 15, 20, 30, 50, 100, and 200 days. The shorter the time span used to create the average, the more sensitive it will be to price changes. The longer the time span, the less sensitive the average will be. @TradingView has many of these tools to use under the list of indicators. A simple moving average is formed by computing the average price of a security over a specific number of periods. Most moving averages are based on closing prices; for example, a 5-day simple moving average is the five-day sum of closing prices divided by five. As its name implies, a moving average is an average that moves. Old data is dropped as new data becomes available, causing the average to move along the time scale. Then you have an Exponential Moving Average (EMA). reduce the lag by applying more weight to recent prices. The weighting applied to the most recent price depends on the number of periods in the moving average. EMAs differ from simple moving averages in that a given day's EMA calculation depends on the EMA calculations for all the days prior to that day. You need far more than 10 days of data to calculate a reasonably accurate 10-day EMA. Highlighting the difference between an MA & an SMA - The Smoothed Moving Average (SMMA) is similar to the Simple Moving Average (SMA), in that it aims to reduce noise rather than reduce lag. The indicator takes all prices into account and uses a long lookback period. Then how it can be used and applied, *** There are many strategies out there, the most basic starts with above or below a level (above = buy, below = sell) And then it steps into two moving averages crossing for example. Also as I mentioned above - other indicators use a form of moving average to calculate their plot. Another simple strategy - Investopedia This moving average trading strategy uses the EMA, because this type of average is designed to respond quickly to price changes. Here are the strategy steps. 🍒Plot three exponential moving averages—a five-period EMA, a 20-period EMA, and 50-period EMA—on a 15-minute chart. 🍒Buy when the five-period EMA crosses from below to above the 20-period EMA, and the price, five, and 20-period EMAs are above the 50 EMA. 🍒For a sell trade, sell when the five-period EMA crosses from above to below the 20-period EMA, and both EMAs and the price are below the 50-period EMA. 🍒Place the initial stop-loss order below the 20-period EMA (for a buy trade), or alternatively about 10 pips from the entry price. 🍒An optional step is to move the stop-loss to break even when the trade is 10 pips profitable. 🍒Consider placing a profit target of 20 pips, or alternatively exit when the five-period falls below the 20-period if long, or when the five moves above the 20 when short. I hope this helps - Please feel free to add more info below. Any suggestions & comments to help new traders, always appreciated. Disclaimer This idea does not constitute as financial advice. It is for educational purposes only, our principle trader has over 20 years’ experience in stocks, ETF’s, and Forex. Hence each trade setup might have different hold times, entry or exit conditions, and will vary from the post/idea shared here. You can use the information from this post to make your own trading plan for the instrument discussed. Trading carries a risk; a high percentage of retail traders lose money. Please keep this in mind when entering any trade. Stay safe.
BITSTAMP:ETHUSDEducation
by Mayfair_Ventures
97
❗ What to look for when I post an idea - Check the Trade Log! ❗A quick video running through how my ideas work and why they're different! Trading for me is all in the detail and the planning now. Know your numbers and your data and you can plan properly. You know if your strategy or system works or not and you can ensure your risk management is in line with probability. Rule number one is... You cant run out of money, else you're out of business, right? You can even run out of money with a profitable strategy, if you risk to much and hit a losing streak - even if the strategy is profitable! Trading is a long game, not about retiring off that one lucky trade you might hit over the course of a week. You'll also give the profits back with interest anyway. Talking from experience! Have a great weekend, any questions - feel free to reach out vis the DM. ------------------------------------------ I try and share as many ideas as I can as and when I have time. My trades are automated so I am not sat in front of a screen daily. Jumping on random trade ideas 'willy-nilly' on Trading View trying to find that one trade that you can retire from is not a sustainable way to trade. You might get lucky, but it will always end one way. ------------------------------------------ Please hit the 👍 LIKE button if you like my ideas🙏 Also follow my profile, then you will receive a notification whenever I post a trading idea - so you don't miss them. 🙌 No one likes missing out, do they? Also, see my 'related ideas' below to see more just like this. Interested in access to my strategy so you can be in these trades the moment they're valid? Drop me a DM . The stats for this pair are shown below too. Thank you. Darren
Education
by pow_removetheguesswork
29
Why Most Traders Lose Money — Here Are The Top 3 ReasonsI’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Anyone that has been around the markets and trading for any period of time has probably heard that most traders lose money. In fact, there’s actually an old trading adage that says: 90% of new traders will lose 90% of their account within 90 days. So after reading that, before you reach for your broker’s phone number to wire out all of your money… how about I let you in on a little secret: If you follow some simple rules and avoid these 3 mistakes, you can be in that minority of traders that actually make money consistently in the markets. And if you are currently making one or all of the mistakes, I’ll also show you exactly how to fix it. So let’s dive in! 1) Most Traders Enter A Trade Too Late The first thing on my top 3 reasons why traders lose money is: Most traders get into trades WAY too late! There are a lot of reasons this happens, but most commonly it’s because new traders are basically gambling. They’re buying stocks or options based on news, or a hot stock tip, which really isn’t what I would consider a strategy. So let me give you a great example with a company I’m sure you’ve heard of: Uber Technologies (Yes, enemy #1 for taxi drivers worldwide.) Last year UBER , known for its popular ride-sharing and food delivery services, IPO’d in May (2019). With the disruption this company caused, their IPO had a lot of hype surrounding it, bringing a lot of investors to the table. On the day of their IPO, UBER opened at $42/share and people poured into the stock. For a few weeks, the stock had a turbulent, roller coaster of a ride all the way to as high as $47.08/share, a little over a 13% increase since its IPO. And around this new high, more and more inexperienced retail traders piled in thinking that it would continue its bullish run with dollar signs in their eyes. The mainstream media was continuing to hype it and more and more and investors and traders gobbled up more of the stock. Looking at the image below, you’ll see after that high of $47 things got UGLY fast, with UBER falling day-after-day, week-after-week. It wasn’t until November of 2019, about 7 months after their IPO that UBER found a temporary bottom at $25.58, down more than 45% from its high of $47.08… and I would bet there were a LOT of people who bought near or at the highs and were still holding at that point. So what did retailer traders do when UBER made a bottom? Yes, once again most (losing) retail traders didn’t get in at, or even around the bottom… once again, they piled as UBER neared its previous highs. And as you’ll see yet again, UBER rolled over on its way to making another new all-time low this past March 2020 going all the way down to $13.71/share. That’s more than a 70% decrease from its ATH and yes, I’m sure some investors rode it all the way to the bottom. Now I want to share a second example with you, so let’s take a look at Amazon AMZN . So as you know, AMZN is a HOT STOCK and last year it has a crazy move where it crossed $2000/share…. and yes, just like our example with UBER , inexperienced retail traders piled in at the very top. Once again, in the weeks that followed, AMZN’s stock tanked leaving those who’d piled in dazed and confused, now holding onto sizable losses. So as you can see, the first of my top 3 reasons most traders are losing money is simply because they’re piling in way too late in a stock’s move, generally near a high. Now on to reason number 2: 2) Most Traders EXIT Too Late Yes, as you can imagine if people are getting in too late, well, they’re also typically getting out too late as well. So let’s talk about why this happens. Why do retail traders tend to hold onto trades way too long, either turning a small loss into a BIG loss or sometimes even more painful, turning a winner into a loser? Let’s take a look at another example with an UBER competitor, LYFT . Like UBER, LYFT also had its IPO in 2019, opening up at $87.24/share… but that didn’t last long. In less than two months, LYFT went as low as $47.17… and what do you think those who bought during the IPO are saying right about now: “Oh, I’m holding it because IT WILL TURN AROUND!” This is generally where I see traders get religious Instead of ‘taking their medicine’ and getting out when the trade moved against them, they held on and are now pleading and praying the stock will turn around. I hate to be the one to break it to you, but ‘hope’ is not a strategy… at least not one with a winning trading record. Now on to number three in our list of top reasons why most traders lose money: 3) They Don’t Have A Trading Strategy As you’ll see, I’ve saved the best for last as this one alone can help fix or eliminate the other two we just discussed. So first, let’s answer this question: What Is A Trading Strategy? Well, a trading strategy gives you three key pieces of information you need before ever entering a trade: 1) It tells you WHAT you are trading. Is it stocks, options, futures, cryptocurrencies? This is answered in your trading strategy. 2) It answers when you ENTER a trade. 3) It answers when you EXIT a trade and that’s exiting with a profit or loss. Now, let’s take a look at an example here using TSLA on how I make trading decisions. I like to look at three different indicators, that when in alignment, give me a clear signal to go long or short a stock or ETF. As you can see on the charts, back in December of last year (2019) my indicators gave us a long signal on TSLA at around $370/share. And the indicators told me we were good to go until around $850/share. All I had to do is let the indicators tell me when to get in and when to get out… no guessing, hoping or praying. Summary So as you can see, there’s actually no big secret to why most traders are losing money. It’s actually pretty simple to see and correct, but it takes a plan and a little bit of discipline. If you’re brand new and not sure where to get started, I’ve written The PowerX Strategy, a book that outlines my EXACT trading strategy for trading stocks and options.
TVC:NDQEducation
by rockwelltrading
1
Why S and R works so good - Spring & Upthrust WyckoffWelcome Traders to a new Educational Posts. Today we will have a deeper look at Support and Resistance. One of the most popular chart techniques out there, but the question?! Do they really work? Absolutely YES. But probably not like most of the traders think they do. That simple Break and Retest Strategy. NOOO! I would like to introduce you to the extended version of Support Resistance. The Wyckoff Spring and Upthrust. Wyckoff Spring and Upthrust In other words they are simply the Fake Outs at Support and Resistance Levels. The idea behind it is to get an entry exactly there where most of the trader will put their SL. -> WHY?! because of the LIQUIDITY The whole market is based on Liquidity (Supply Demand). The bigger fish will always win. Those who have the bigger amount will always dominate here. Just FACTS . So how do you want to position yourself in the market. Exactly there were 95% of the Retail Traders will put there SL? Or do you want to change your perception on how you view the market. This will completely change your view on the Forex Market. Supply Demand What I also do is I use my own style of Supply Demand to identify exactly those areas where most of the trader will put there SL and I will place exactly my Entry there with a very tight SL to get bigger Risk Reward. Of course I will not have that much of valid entries for my setups as they do not occur as often as Support Resistance Setups but the Total Risk Reward is a complete new Level. WHY? Example Upthrust Because you are rocking the market with the market movers. You are always clearing with these entries both sides. #1 Sellers at Resistance because of Upthrust #2 Breakout Trader(buy) because of Upthrust Sell is the right decision in this case but most of the Traders will lose that Trade due to SL hit. Everybody is placing the Entry and SL different but the majority is losing this trade. Spring Example This was the bigger manipulation as the price did a strong move to the downside through the level of Support. This level was a very interesting level for Retail Traders to buy. Doji occured for Price Action Confirmation but the price dropped down to the level of Demand. Why? -> Liquidity. All SL were located there so Market Movers had there buy limit order placed exactly there. Conclusion With this Post I do not want to judge Retail Traders using Support Resistance. Maybe you found a nice Strategy with that and you are profitable. I am also using Support Resistance but simply in a different way as you can see. I just wanted to share with you my thoughts behind Support Resistance and how I use them to be profitable Please leave a LIKE if you found this Post useful and share your thoughts below!
Education
by DariusFxTrading
3
Trading The Wheel Options Strategy — 3 Reasons Why You’d Lose MoI’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. So, as you know, I love trading the wheel options trading strategy, and this past week was a roller coaster for this strategy. Friday morning I woke up and my account was down $25,000. Now I’ve been trading a larger account. It’s two hundred fifty thousand dollars in cash, five hundred thousand dollars in margin, so $25,000 is not that much, but still. So in this article, we are going to talk about the Wheel Options Strategy. We will talk about the three reasons why you would possibly lose money with this strategy and also how to avoid these mistakes. So here we'll talk about my account. As you know, this show is about real money and real trades, and at the time of this writing, I am still down about eighteen thousand dollars. So it has gotten a little bit better since this morning, but down eighteen thousand dollars. So we’ll take a look at these trades in detail. But first of all, let’s talk about the three reasons why you would lose money with this strategy and then also how to avoid them. 3 Reasons You Would Lose Money So there are three big mistakes that you can make when trading The Wheel strategy. So the first is panicking. If you are somehow trapped in a position and you say, what the heck do I do now? I often see traders who say, “What do I do now?” So solution number one is don’t panic. Easier said than done, right? But not panicking is so important. This is what one of our members posted in our community. “It’s not a loss if you don’t sell.” so the worst thing that you can do going back to this is panicking and closing your positions at a loss. Don’t do this. Don’t close your positions, & evaluate what’s happening. The second mistake is not having a plan. Mistake number three is not having the right trading tools. So, now I will go through my positions that I had and then I will show you how I handled them with my plan. Then we will also talk about the third mistake in more detail, and then some more solutions. My Positions So five positions that I had in my account were (On February 26, 2021): AAPL AMD DBX GDXJ RIDE So let’s start with AMD first. If AMD were to stay above 83.50 until the remainder of the trading session (at the close that day), I’d make money. Everything that happens with my positions, I write this down, and I recommend you do the same thing so that you know of what’s happening to your positions. You will know which ones are actually in trouble and which ones are good to go. So if AMD closed above 83.50 nothing would happen, and I would keep the whole premium. For this trade, this was $576 in premium for the week. Not bad at all. The second position is DBX which is Dropbox. So Dropbox needs to stay above 21.50 and it was trading at 22.85. So it seemed that we were pretty good there. You might be wondering why I am talking about the positions that are OK? You see, in order to stay calm and to make sure that you’re not panicking, focus on the positive first. I know if you’re taking a hammer and you smack one of your fingers, what do you focus on? The finger that hurts. Right? But you have four other fingers that are absolutely fine. So it’s important to focus on what’s going right for us. So if DBX stays above 21.50, which is very likely. So I sold 47 of these options for $13 totaling $611 in premium, so not bad at all. So what’s happening with GDXJ? So the week prior I got assigned because it expired below my strike price. So I got assigned 2,100 shares at $48. Now, here’s what I did with this. So let’s forget these shares for just a moment and let’s again focus on the positive of what’s working well for it. I sold covered calls at the 49 strike price, and I collected premium. So how much premium did I collect for these calls? I sold 21 contracts for $75 each. So I collected for this trade, $1,575 in premium. So we are OK there, and I still have the shares, because they expired worthless. So the next position is RIDE. So if it stays above 21.50 I just collect the premium and nothing else happened, but the price stayed below. I got assigned 4,700 shares at $21.50 so this position is in trouble, we will deal with that at some point, but here’s the good news. I still collected $1,974 in premium. So the last position here is AAPL, and I did get assigned these shares a week prior. So I have 800 shares and I’ve not been able to sell any calls against it. So here I have 800 shares at 133, and also these shares are in trouble because Apple right now is trading at $124. So I got assigned and now AAPL is down. Not good. I still collected all this premium and it all added up. So because overall, it was a pretty darn good week, collecting $4,736 overall. I don’t know about you, but this is not bad at all. And I know you might be saying, “oh my gosh, you’re talking about making some money here, but what about all of these red positions?” Why You Shouldn’t Worry About Being Assigned We’ll take a look at these starting with RIDE This is where it goes back to what is the worst thing that you can do? Panicking. Like if I were to sell for example. If I would sell these shares instead of collecting the premium that I have here, I wouldn’t have made any money on RIDE, I would have lost $8,272 instead. I don’t know about you, but I would rather keep the premium of $1,974 instead of losing $8,272. For me personally, I will not worry about it. So here is where it goes back to. What do we do? Follow your plan. So you got to follow your plan, and this point I’m about to make is very important. I’m actually excited to get assigned, and in a moment you will see why. Your reaction should be, “Yes! I am assigned because I want to own the stock.” I’m really, really happy about this. I’m happy about having stocks. Or your reaction might be this where you say, “oh my gosh, what have I done?” If this is your reaction, then you violated the number one rule of “The Wheel Club,” and here’s the number one rule of the wheel club: "Don’t sell puts on stocks that you don’t want to own". OK, wrong movie, but you get the idea right? So let’s take another look at my positions. Am I happy to own AAPL stocks? Yes, I am. Am I happy to own GDXJ and RIDE? Yes! Would I have been happy to own AMD stocks if I was assigned? Of course! Absolutely! OK, so let’s take a look here at the stocks that I’ve traded thus far year to date. And as you can see, my profits year to date, around $43,000. Take a look at all the stocks. These are the stocks that I would not mind owning at all, and this is really the number one rule of The Whale Club. So Apple, AMD, DBX, GDXJ, HAS, IBM, LL, WYNN, ect. All of these are good, solid stocks that I wouldn’t mind owning. So let’s talk about what do we do with RIDE. Why am I so excited to own it? This is where it goes back to having a plan. So my plan is just to follow The Wheel strategy, and this means that after assignment, I will sell covered calls and collect premium. Very, very easy. This is where we go back to mistake number three, not having the right tools. I use the PowerX Optimizer and I will show you right now how to use it and why it is so important. So PowerX Optimizer supports two separate strategies. The PowerX strategy as well as The Wheel strategy and part of the PowerX Optimizer is the real income calculator. I set my buying power to $500,000 because that is the buying power that I have in the account. So the stock I want to use as an example is RIDE. Let’s plug in some numbers and see what our premium is on this one for if I get assigned these shares, and start selling calls. So getting assigned 4,700 shares at 21.50. Now, the option strike price that I’d try to sell would have to be at the price that I bought at or above. The last traded price was $0.43, so let’s assume we’re selling the shares at that same price. So I’m using the strike price here of 21.50 and I’m selling calls for $0.43. If I did this I would get $2,021 in premium! Wholly Cannoli, are you getting excited about this? I’m excited about this. Now you see why I’m excited to get assigned. If you add this with the premium I’ve already collected on RIDE from selling puts, which was $1,974, that’s almost $4,000. You get the idea right? So I would not make any money on the stock but that is OK. So is this stock really in trouble if I make 4000 dollars in two weeks? I don’t think so. So one trade that I had last week that wasn’t doing so well was AAPL. I got a signed AAPL at 133, so I need to see if I would get enough premium to sell calls. This is why it is so important & I can’t even stress this enough, how important it is to have the right tools. Having the right tools help you make the best decisions instead of panicking. Back to AAPL, I was assigned 800 shares at $133. How much premium could we get for selling calls? So right now, if we sell calls with expiration for the end of this week, at the 133 strike price, we would only get about $0.13, and I would only make about $104 which is nothing. So out of all these positions, Apple is the only one that right now is kind of in trouble because I not yet able to get enough premium when trying to sell calls, but that is OK. All I need to do is just be patient and wait until AAPL goes up. Summary In the meantime, I do believe that Apple is a solid company, and I don’t mind owning the shares. This is where we go back to rule number one of The Wheel Club. “Don’t sell puts on stocks you don’t want to own” because if you do this, then you probably sitting there today, like, what have I done? But I hope this helps you see how to deal with being assigned and that you also see, how to handle things when a trade is in “trouble.” Just sell covered calls, and collect premium. If there isn’t enough premium available to sell calls, just wait until it bounces back, it’s really not a big deal. I am absolutely OK making $4,736 last week with the potential to make another $3,000 this week. Not bad at all, as you know. My goal is to make $15,000 per month. If I can make $7,000-$8,000 in two weeks. I’m well on my way.
NASDAQ:AAPLEducation
by rockwelltrading
1
Granolabar's Gap Down Guide (my own style)Introduction Within the past week, AMEX:SPY has become increasingly volatile, with massive gap ups and downs followed by all day runs extending more than 3% in either direction. This is apparent with a cursory glance at the following chart. With this volatility comes uncertainty, especially for those who are swing trading on the timeframe of a few days to a few months. However, we can use this increased volatility to our advantage. i am going to introduce my way of trading these days, particularly the ones involving gap downs. Identifying the Setup Identifying the setup is relatively simple, but there are a variety of factors that can improve your chances of success. Firstly, the stock needs to have gapped down overnight. This one is quite obvious and easy to identify; look for a literal gap in the prices going from after hours to premarket, like those identified in the following chart of SPY. Secondly, there are a few things that can improve the chances of this strategy playing out. For example, if the stock recently hit a supply zone and rejected, the gap down is more likely to be followed by more downside as the stock is already in "pullback mode." Additionally, trendlines are another great thing to keep in mind. For example, SPY recently hit a nearly 4 month long strong trendline and rejected. Generally speaking, the larger the timeframe that the trendline is identified on and the more "touches" it has, the stronger it will be. I often find it useful to work my way down from the 1 month or 1 week chart down to the hourly to identify trendiness that I need to keep in mind. Trading the setup To trade this setup, I like to primarily stick to the 5 minute chart. The one minute chart has too much noise, while the 15 minute takes too long for confirmation that you would miss a sizable amount of the move. Once you are on the 5 minute chart, draw a horizontal line at the bottom of the premarket low, as shown below. This will be the critical value to watch. Theoretically, you want to enter when that line breaks , BUT there are often fakeouts around these critical levels. To know when to enter the trade, I watch the candle sticks. First, there must be a 5 minute candle that closes below the premarket low. Then there are two possible scenarios from here. Scenario 1, the next candle immediately pushes below the low of the first candle. In this case, you would take puts or sell short as soon as the second candle breaks the low. My reasoning for this is that if the movement is strong, the second candle would not hesitate to make a new low. It is better to enter on the break than to wait for the candle to close and miss out on potential profits, which are often pretty sizable when things are moving quickly. Notice in the below example that had you waited for that candle to close, you basically would have missed half of the entire fall, which lasted 4 5 minute candles. Scenario 2, the next candle does not immediately push below the low of the first candle. In this case, you would wait until there is a candle that closes below the low of the first, instead of merely making a new low. My reasoning is that if the momentum is not strong enough for the second candle to immediately make a new low, the confirmation candle to enter needs to be more definitive. The play is not invalidated because the first candle closing below the premarket lows indicates that there is downwards pressure. In this way you minimize the likelihood of shorting a bear trap while also capitalizing on the fall. Let's Talk Take Profit and Stop Losses Now that you have successfully entered the position at an optimal place, the next thing to consider is where you want to exit, whether that is to secure the tendies you just made or protect yourself from further losses. Note, this part is completely up to you and your risk or reward tolerance. Assuming that it all goes to plan the the stock starts to fall: I typically trade weekly options for this kind of play, as it is a short term play. Because options premiums move quickly in both directions, I will take profit at 25% with about half the position if the candles are getting smaller, indicating that the trend may be weakening. Then I will set a stop at open, meaning that I will sell the remaining portion of the position if the contract goes back down to my purchase price; this guarantees that ultimately the play is profitable. However, if the candles stay rather large, I will hold the position until the candles do start to get smaller, and sell half the position there, often around the 50%, 75%, or 100% profit mark. If the option does hit 100% profit, I will almost always sell half, with very very few exceptions. This ensures that even if the other half of my position expires worthless(worst case scenario), I come out of the play completely unscathed. If the play does not go according to plan: Let's assuming that right after you enter based on the conditions above, the stock reverse to the upside. Now the question becomes, when do you sell to prevent yourself from taking major losses. For this I use my EMA clouds, or simply just EMAs with the region between the lines shaded in. I typically have a 5/12 EMA cloud (green) and a 34/50 EMA cloud (blue). As soon as one candle closes above the 5/12 green EMA cloud on the 5 minute chart , and the next candle closes above the first candle, that Is when I take the loss and move on. Often times, when playing this strategy, the price will come back up and retest the break line; do not panic if the position is immediately red, but also stick to the stop loss rules mentioned above. This cloud strategy also applies to closing the last half of the profitable position mentioned above. When you are left with half a position at 100% profits or more, I will wait for reversal to sell. The reversal tends to happen when one candle closes above the 34/50 EMA cloud on the 1 minute, and the next candle pushes past the first high. There are also many other ways to market the bottom, such as bullish divergence, engulfing candle, abandoned baby, etc. TLDR This is my way of trading gap downs that utilizes candle sticks and the EMA clouds to determine Stop loss or Take Profit places. Simply put, buy puts when the price cleanly breaks the premarket low, ride with the clouds until they suggest a reversal or hit a stop loss point. if you have any questions or comments, please feel free to let me know. I would love to hear other perspectives or criticisms. Also, the "clouds" are just EMAs filled in with crayons, but if you want the script, it's in my profile.
AMEX:SPYEducation
by granolabar_trades
30
How I’ve Improved Productivity in My Trading DayI’ve been trading for a long time, and over the years, I’ve learned different ways to make the most of my time. Today, I want to talk about three ways I boost productivity in my trading day: - Using my PowerX Optimizer to quickly scan for long and short trading ideas. - Using my Wheel Income Calculator to find attractive premium collecting ideas. - Having a trading plan and following that plan. In this article, I’m going to break down each one of these and explain what they are. I’ll also explain how they help me streamline my trading. This gives me more time to focus on other things I’m interested in, like my business and real estate. 3 Pillars To Trading I always say there are three pillars to trading: - You need to have a trading strategy. - You need to have the right tools. - You need to have the right mindset. For me, I trade two strategies: PowerX and the Options Wheel. And I developed my own software tools to help me trade these strategies quickly and efficiently. The PowerX Optimizer software shows me what I should trade, when I should enter, when I should exit based on my preferred criteria, and my Wheel Income Calculator tells me which option strike has the best risk/reward. If trading software doesn’t show me this, it’s not allowing me to make the best use of my time. Let’s take a closer look at these software programs, starting with the PowerX Optimizer. PowerX Optimizer With my PowerX strategy, I’m looking to buy calls on stocks trending higher or buy puts on stocks trending lower. The PowerX Optimizer is a software I programmed for myself, my head coach Mark, and my son. A few years ago, we made it available to everyone. This software answers the three questions I’m looking to have answered when I’m looking for stocks - What to trade. - When to enter. - When to exit. The PowerX Optimizer will answer all three of these questions for you. Now, I had the software programmed for myself because I wanted all my criteria in one place. With the PowerX Optimizer, I can scan for my basic criteria that I set within the software. For instance, I want to see a 60% return on investment over the past year, I also want to see stocks that are between $5 and $200, and I want a profit factor higher than 3 and a risk/reward higher than 2. This is the criteria I use for trading this strategy. Your criteria may be different. The scanner finds the best stocks and options for me based on my criteria. I certainly don’t want to just stumble across a stock or trade everyone on TV is talking about. Worst case scenario, if nothing meets my criteria, I simply move on. Every day this scanner produces a list of stocks that I potentially want to trade — in less time than it takes to make a cup of coffee! Talk about a time saver! In the beginning, I would just use charting software like TradingView, and I would go through a bunch of stocks every day to see if they met my criteria. It got to the point where I figured there had to be an easier way, which is why I had the PowerX Optimizer developed Instead of spending hours and hours sifting through charts and doing the math, I’m able to find a handful of stocks to look through every day in just minutes. This frees up my time to focus on other things. The Options Wheel Calculator With my Options Wheel strategy, the idea is to “get paid to wait until you buy the stock.” So I’m looking to sell a put and collect premium, and I want to pick a strike that coincides with the level I would feel comfortable buying the stock. Ultimately, I want to get assigned, and then I’ll look to potentially sell covered calls on the stock. The tool I use to identify stocks and options I want to trade with this strategy is the Wheel Income Calculator. The Wheel Calculator pulls up stocks and tells me the minimum option premium I need to collect to make this trade work for me, and the risk/reward setup for each strike. I have set aside $500,000 in buying power for this strategy. That’s what works for me. It does work with smaller accounts if that’s what you have to work with. That’s why I love these tools. They have made my life so much easier. I’m not just picking a trade based on a gut feeling. Instead, I’m trading with a systematic approach that’s based on data. Remember, I like to trade for SCR Profits. SRC stands for Systematic, Repeatable, and Consistent. Trading Plan And that leads me to the last thing I want to talk about today: having a trading plan. You see, having a trading plan is key to having the right mindset to trade. There are three key parts of a trading plan that I’ve already mentioned, but again, they are: - What you’re going to trade? - When you’re going to enter? - When you’re going to exit — both for a profit and a loss. This is also where those limit and stop-loss orders I mentioned earlier come in handy. Limit orders allow you to tell your broker the price you want to get filled, and if you get that price, you move on. Same with stop-loss orders. You tell your broker what point you want to get out of the trade, and if the stock hits that level, you’re out. This allows you to not be tied to your computer, watching every tick the stock makes and opens up your day to allow you to focus on other things. I cannot stress enough how important it is to be prepared when you’re trading — and to have a plan before you enter a position. So, as you can see, by defining my strategies, I developed tools like the PowerX Optimizer and Wheel Income Calculator to help me find trades quickly and efficiently that work with my rules and my plan. I hoped this helped and I’ll see you at the next one.
TVC:SPXEducation
by rockwelltrading
1
What’s The Best Vertical Spread Option Strategy?I’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. What’s The Best Vertical Spread Option Strategy? You may have previously heard someone say, “ Vertical spreads are the same as getting weekly paychecks! “ Is that even true? We’re going to go in-depth on each strategy to discuss each of the pros and cons. I’m also going to discuss how each strategy should be used in any given market condition. Since we’ve previously discussed credit spreads and debit spreads, you’re probably wondering… what’s the BEST vertical spread option strategy? Let’s break down each of the vertical spread option strategies in detail and look at examples in Tasty Trade. Call Debit Spread What is a Call Debit Spread? A call debit spread is a position in which you buy a call option and sell a call option at different strike prices using the same expiration date. When should this strategy be used? This strategy is used when you believe the stock is increasing in price, but not a dramatic movement. What are the benefits of this strategy? Trading this position can potentially reduce the overall cost associated with taking on the trade. This type of strategy also reduces the break-even price of the trade. When does this trade lose money? When the underlying stock moves sideways or downward. What is the max risk for this trade? The max risk associated with this strategy is the cost of the premium paid to take on the trade. What is the max reward for this trade? The max reward for this strategy is the difference between the strike price of the two calls, multiplied by 100. Minus the premium paid to take on the trade. Call Debit Spread Example - Reduced Margin Requirement: $910 - Max Risk Reduced: $910 - Max Reward: $4090 Put Debit Spread What is a Put Debit Spread? A put debit spread is a position in which you buy a put option and sell a put option at different strike prices with the same expiration date. When should this strategy be used? This strategy is used when you believe the stock is decreasing in price. What are the benefits of this strategy? Trading this position can potentially reduce the overall cost associated with taking on the trade. This type of strategy also lowers the break-even price of the trade. When does this trade lose money? The underlying stock moves sideways or downward. What is the max risk for this trade? The max risk associated with this strategy is the cost of the premium paid to take on the trade. What is the max reward for this trade? The max reward for this strategy is the difference between the strike price of two calls, multiplied by 100. Minus the premium paid to take on the trade. Put Debit Spread Example - Reduced Margin Requirement: $910 - Max Risk Reduced: $910 - Max Reward: $2090 Call Credit Spread What is a Call Credit Spread? A call credit spread is a position in which you sell a call option and buy a call option as protection. These option contracts have different strike prices but have the same expiration date. When should this strategy be used? This strategy is used when you believe the stock is decreasing in price or trading sideways. What are the benefits of this strategy? Trading this position produces a credit from the premium received for selling the put option. Buying the additional call option provides protection, limiting the risk of the trade. When does this trade lose money? This trade loses money when the underlying stock moves up quickly past your strike price. What is the max risk for this trade? The max risk associated with this strategy is the difference between the strike prices, multiplied by 100. What is the max reward for this trade? The max reward for this strategy is the premium received for selling the call option, minus the premium paid for protection. Call Credit Spread Example - Margin Requirement: $965 - Max Risk: $965 - Max Reward $35 - Premium Received: $35 Put Credit Spread What is a Put Credit Spread? A put spread is a position in which you sell a put option and buy a put option as protection. These option contracts have different strike prices but have the same expiration date. When should this strategy be used? This strategy is used when you believe the stock is increasing in price or trading sideways. What are the benefits of this strategy? Trading this position produces a credit in the form of the premium received for selling the put option. Buying the additional put option provides protection, limiting the risk of the trade. When does this trade lose money? The underlying stock moves downward sharply. What is the max risk for this trade? The max risk associated with this strategy is the difference between strike prices, multiplied by 100. What is the max reward for this trade? The max reward for this position is the premium received for selling the put option, minus the premium paid for protection. Put Credit Spread Example - Margin Requirement: $837 - Max Risk: $837 - Premium Received: $163 - Max Reward: $163 How Do I Choose The Best Vertical Spread Option Strategy? I personally only select options that match my trading plan. You’ve probably heard me say it a million times if you’ve heard it once… There are 3 things you need to know to be successful at trading. 1.) You need to know which options to trade 2.) You need to know when to enter 3.) You need to know when to exit I use the PowerX Optimizer to help me execute these trades successfully.
TVC:NDQEducation
by rockwelltrading
Trading Stocks vs Options: Which Is Better? I’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Stock Trading vs Options Trading Stock trading vs options trading, what should you trade? What is better? Is it better to trade stocks or is it better to trade options? That’s what we’re going to talk about today. I will also show you practical examples from trades that occurred today, so let me jump onto the desktop. Now, I want to use an account size of $20,000 as an example here where I’m comparing whether it is better to trade stocks versus options. Depending on your account size, just multiply the numbers that I’m showing you by whatever your account size is and you’ll get the idea. So the idea is, on a $20,000 account, we want to risk 2% of the account. This would be $400, nothing more. Comparing Stock Trading vs Option Trading Now, as we are comparing stocks and options, here are the things that I want to compare. First of all, I want to write down how much we are risking stock trading vs options trading. I also want to write down the reward, how much are we planning to make on the stock or the option. Based on this, I want to write down the risk/reward ratio, and also very, very important, the buying power. What is the buying power? The buying power is the amount of your account that you need to reserve for this trade. It is not the risk and you’ll see this in just a moment. Let’s take a look at some very specific trades that happened this morning. INSW Stock Trading vs Option Trading The first trade that I want to discuss is INSW . So this morning (at the time of this writing) on the PowerX Optimizer, INSW came up as a trade, as a buy to open. And the idea here is that we are buying 239 shares based on a $20,000 account at $22.84. Our stop loss was at $1.67 and I was trading 239 shares. I want to keep it a little bit easier for all of us with the math so let’s round up and call it 240 shares. What is our risk? Per one share, we are risking $1.67 and we are trading 240 shares, meaning that our risk is exactly $400.80. So here let’s just round it to $401. Now, what is the potential reward that we are looking for? Here we are looking for a reward of $8.62 per share. $8.62 times 240 shares, so we’re looking to make $2,069. So we’re putting this into our table, $2,069. So the risk/reward ratio here, PowerX Optimizer is calculating it, it’s 1:5.16 so let’s just say 1:5.2. Now for the buying power. Again, we are buying 240 shares, and the cost per one share is $22.84, so we need $5,482 in buying power. So this is how much our buying power will be reduced when we enter the trade. Now, let me ask you, is this making sense thus far? Just so that you know what happens when you’re trading the stock? And again, we are trying to risk around 2% of the account here, $401. Now, let’s take a look at the option here. So I prefer to trade the in the money, I’ll do another article on the difference between ITM and ATM. But here we are talking about the $22.50 call, and the risk was $172 per one option. So if we want to risk $400 overall, we’re dividing this by 172 and we can trade 2 options risking $344. We’re risking a little bit less and this is just based on the price of the option. In terms of the reward, we’re looking to make $6.80, it’s $680 per one option and we are trading 2 options, meaning that if this trade works out, we would make at least $1,360. Now, according to The PowerX Optimizer, we were making a little bit less. So let’s take a look at the risk/reward, the PowerX Optimizer calculated for us. So the risk/reward was slightly lower at 1:3.95. Now we’re rounding it up so it’s 1:4.0. So as you can see, the risk/reward ratio when trading the option is slightly worse but here’s the deal. What is the buying power that we need for this? The buying power that the broker will deduct from the overall buying power in the account is our entry price. So here we were trying to enter at $2.16, we can round it up to $2.20, and since we are trading 2 options this means that our buying power is $440. Can you already see what the difference is between stock trading vs options trading here? Your buying power is less than 10%. Now, keep in mind, the buying power is not what you’re risking. The buying power is just how much of your $20,000 is being held in reserve for this particular trade. So you can’t use this money anymore. If you trade the stock, you would still have around $14,500 left. However, if you’re trading the option, you would still have $19,500 left. Is this making sense thus far? TVTY Stock Trading vs Option Trading The other trade that I want to show you is TVTY . Here we wanted to trade 392 shares, so let’s just round it up to 400. Now let’s discuss the risk first. So the risk is $1.02 per one share. We’re taking $1.02 times 400 shares, meaning that we would risk $408, which is still within our parameters. We were planning to risk around $400 so here it would be a little bit more, it would be $408. Now, if this trade works out, here is what the reward would be. So the reward is $5.61, that’s how much we are trying to make on this trade. And if we take the $5.62 times 400 shares, we are trying to make $2,248. So the risk/reward, if we look at this, is 1:5.5. Now, here is the buying power that we would need. TVTY is trading at $11.30, so this is where again, $11.30 times 400 shares, we need $4,520 in buying power. Again, not a big deal if you’re trading a $20,000 account, it will be reduced and you’ll have less money to trade right now, around $15,500. Very, very, very important, this is not the risk. This here is the buying power that is needed. Our risk is $408. Our risk here per one option is $141. So if we want to risk $400 overall, we’re dividing it by $141, it’s 2.83. Now, in order to make it all a bit easier to compare apples with apples here, I am actually saying that we would trade 3 options, and $141 is what we are risking per one option, so $141 times 3. It’s a little bit more than our $400, but I think we are still OK here. So we would risk $423. Now the potential reward per one option is $444. So this is where we take $444 times 3, and again, this is where we are looking at $1,333. As you can see, the risk/reward ratio here is worse than if we would trade the stock. It is 1:3.15 so we are rounding it again to 1:3.2. Again, it would be better to trade the stock, but you’re using quite a lot of your buying power. For the option, all you need, all that is reduced, is your entry price, and the entry price it’s $2.47. So let’s say $2.50 times 3 is $750. As you can see you need less buying power, but you also have a smaller reward. But this is why I say usually on a smaller account, it makes sense to trade options instead of stocks. Now the other important thing, especially when you trade a retirement account, is that you don’t get a margin account. This means that you cannot leverage the money that you have in the account and you cannot short stocks. So in the US, in a retirement account, you cannot short stocks. However, what you can do in a retirement account is that you can trade put options, and with put options, you can bet on a falling market. So this brings me back to the question… What is better, stock trading vs options trading? Well, this is why I wanted to show you a direct comparison using a real-life example. This way you see exactly when it is more advantageous to trade stocks, and when it is more advantageous to trade options. Long story short, often for smaller accounts, since you use less buying power, it makes more sense to trade options. And now you have a direct comparison between stock trading vs options trading that will hopefully help you decide what is best for you.
TVC:NDQEducation
by rockwelltrading
The Poor Man’s Covered Call ExplainedWhat Is The Poor Man’s Covered Call? Questions we’ll answer in this discussion: - What is it? - Who is it for? - When to use it? The Poor Man’s Covered Call is a very specific type of spread. As you know, we’ve been covering option spreads for several Coffee With Markus Sessions. We’ve also covered the Covered Call’s strategy in-depth on our YouTube Channel. In this article, we’re discussing the difference between trading stocks, covered calls, and the Poor Man’s Covered Call. Trading Stocks Let’s take a look at trading stocks first. Let’s say that you’re bullish on a stock like Boeing BA . If you were bullish on this stock, you might purchase a decent amount of stock, let’s say 100 shares. At the time of the original writing of this article, this stock’s strike price was $180. If you purchased 100 shares of BA , at $180 dollars each, this would require $18,000 in purchasing power. If the stock increases by $10, to $190, you stand to earn $1,000 in net profit. So you’ve risked $18,000 to earn $1,000. If the stock price increases to $200, you’ll earn $2,000 and so on. This is pretty basic and you probably understand this concept. A profit picture is a sliding scale that moves to the right as the stock price increased. It is a visual representation of your profits. or losses depending on the movement of the stock. In this example, the price of the stock is increasing so the scale is moving to the right. Selling Covered Calls In this example, let’s say that you’re still bullish on BA . And in the short term, you expect an upward movement in price. Since you already own the 100 shares of BA stock, you can sell a $200 Call Option against these shares (again, this is based on the price of BA at the time of writing this article). If the stock price increases to $190 like you expect, you’ll earn an additional $450 on top of the $1,000 you’ve already earned. If we see a decrease in stock price, the covered call acts as a hedge. In this example, if we saw a downward movement to $170 you would lose $1,000. But because you sold a $200 Call option contract and received a premium of $450, your net loss would only be $550. Covered Calls VS Poor Man’s Covered Call Poor Man’s Covered Call When would you trade a Poor Man’s Covered Call? That’s easy! When you don’t have the $18,000 to buy 100 BA shares! And When do you trade a covered call? When you expect the stock to stay above the current price and move slightly higher. Instead of buying a stock, you would purchase a deep in the money call option at a later expiration. When looking for a call option deeper in the money, we’re trying to find one with a Delta of 0.95. his means for every dollar the stock moves, the call option is gaining .95 cents in value. Deep “In The Money” Calls For this example, We’re buying a deep ITM call at $71 which means the capital required to take this position is only $7,100. As you can see this is a fraction of the price to purchase the stock outright. At the same time, we will sell the $200 Call option. Similar to the covered call. But instead of owning the stock at a price of $18,000, we purchased the ITM call option and sold a $200 call option. if the underlying stock price moves from $180 to $190 you would make $1335 because the Delta is 0.95, which means it’s only increasing 95% of the value. The profit on this type of position isn’t as high as a covered call, but it’s much more than owning the stock outright, with much less risk and less capital. This sounds too good to be true right? The perfect strategy! BUT… there’s a downside associated with this strategy. Your profit is limited. If you see a huge movement in the underlying stock, you’ll only benefit from a portion of the total gains. In this example, if the underlying strike price gained $40, the stockholder would earn $4,000. The covered call would earn $2450, and the Poor Man’s Covered Call would earn $2,320. Many traders use this strategy because of the limited capital involved with taking on a position, and the limited risk associated with a potential downward movement of this stock.
NYSE:BAEducation
by rockwelltrading
2
Pattern Day Trader RuleI’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Now I want to talk to you about the pattern day trader rule because this rule requires that you have at least $25,000 in your trading account if you are day trading. Here’s the tricky part. The tricky part is that you could trigger this rule even if you’re only swing trading, and not day trading, which is why it’s important that you are aware of what the pattern day trader rule is. I will give you examples of what can trigger it, even if it’s accidentally, and I’ll break down what then happens if you trigger it. Most importantly, I want you to be aware of how you can avoid it. What Is The Pattern Day Trader Rule? So what is the pattern day trader rule? According to FINRA, who set the rule, a pattern day trader is a trader if you execute 4 or more day trades in 5 trading days. So if you execute 4 or more day trades in 5 trading days, then you’re being flagged as a pattern day trader. This is not a good thing. So what actually is a day trade? A day trade is a trade that you open and close, during a trading day. So as an example, if you buy a stock at the open, at 9:30 Eastern Time, and then sell it before 4:00 pm Eastern Time, you are placing a day trade. Now, very, very important: this whole rule only applies to stocks and options. It does not apply to futures, forex, or binary options. It only applies to stocks and options. How To Trigger The Pattern Day Trader Rule How can you actually trigger this rule even if you’re swing trading? Well, it actually happened to me very recently. My head coach, Mark Hodge, and I, we were trading with our Mastermind members. I asked Mark to place a trade in my account, but he accidentally placed it in the wrong account. When something like this happens, I have a rule. “When you make a mistake, liquidate.” So I asked Mark to close the position, and when he did that counted as a day trade. So we opened the trade, realized we made a mistake and closed it right away. This lead to me having one strike in this account. And again, if we would get 4 strikes within 5 business days, then we are flagged as pattern day traders. Now, here’s another scenario. Let’s say that we enter a trade tomorrow and it hits the profit target or stop loss on the same day. So this would be another strike because now we are also entering and exiting during a trading day. So as you can see with this, even if you’re not day trading, it is possible that this could happen a few times. If this happens 4 times within 5 trading days, then you’re flagged as a pattern day trader. What Happens When You Trigger The PDT Rule? What happens when you trigger this rule? Well, first of all, if you have more than $25,000 in your account, nothing happens. This is because the pattern day trader rule says, if you are a pattern day trader, then you need to have $25,000 in your account. Now if you don’t have $25,000 in your account, then you will be restricted to trade on a cash basis only for 90 days. What does this mean? Well, see, as a day trader, you actually do need a margin account, and when you trigger the pattern day trader rule and cannot put $25,000 in there, this means that now you are restricted to trading with cash only. So let me give you an example. Let’s say you are trading the Wheel trading strategy, and you put $20,000 in an account. This means if you put it into a margin account, that you get $40,000 in buying power. So when you trigger the day trading pattern rule, you no longer get this buying power here, the 2:1 leverage. You are now basically going back to whatever cash you put in there when you trigger this rule. How To Avoid Triggering The PDT Rule? Now the question is, how can you avoid this? Well, and I want to give you three tips for how to avoid it. Number one, have $25,000 in your account because if you have $25,000 in the account, then triggering the rule won’t matter. What about if you don’t. Number two, you want to make sure that you count the number of day trades. Leave the date you placed a day trade on a sticky note, and count the number of day trades that you do even if it is accidental, so you can keep track of how many strikes you have. Number three, you can avoid it here by trading a cash account. So if you’re not trading a margin account, you don’t have to worry about it. Then, of course, if you are trading futures, forex, bitcoins, so cryptocurrencies, or if you are trading binary options, this is also when the day trading pattern rule does not really matter. Summary Now you know what the pattern day trader rule is, how you can trigger it, even if it is accidentally, what happens when you trigger it, and how you can avoid this. So let me ask you this, at this point, was this helpful at all? If so, feel free to share this video on Facebook, on Twitter, and I’ll see you for the next article.
NASDAQ:NDXEducation
by rockwelltrading
1
Backtesting retest Break of Market Structure on Multi TimeframeStrategy Create a zone from the order block which created break of market structure on 1D timeframe Wait for it to be tested on 4H timezone => which will create new 4H order block Trade the retest of that 4H order block Color coding & icon use Green boxes : 1D order block zone Yellow boxes : 4H order block zone Tick icon : Trade won on 4H Cross icon : Trade lost on 4H Circle with cross icon : Trade in breakeven Win / loss assumptions Win : 3R movement without breaking -1R Loss : -1R movement Breakeven : 1R movement, followed by -1R movement Risk Management 50% TP @ 1R 25% TP @ 2R 25% TP / Trade closure @ 3R RR achieved = 3R Net R achieved = 1.75R Strategy results Testing duration : Jan 2020 - Jan 2021 Wins = 16 Loss = 7 Breakeven = 4 Non-losers = 74% Absolute Winners = 59% Net RR = 21 Avg R/Win = 1.31R Avg R/Trade = 0.78R
Education
by makuchaku
8
Covered Calls For BeginnersI’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Covered Call For Beginners For good reason, the covered call strategy is one of the first option strategies that new traders start trading. This is an effective strategy that options traders often use to provide income on stocks they already own. Questions to be considered in this article: - What Is A Covered Call? - Should You Trade It? - Specific Example Can You Do It In A Retirement Account, EG, IRA? What Is A Covered Call? A covered call is an options strategy used traders to produce income on stocks on long stocks held in their portfolio. This strategy is used by traders who believe that stock prices are unlikely to rise in the short term. A covered call strategy is defined as holding a long position in stock while simultaneously selling a call option on that same asset. This strategy can provide income to a trader who is long term bullish on stocks but doesn’t believe there will be a significant increase in price immediately. A covered call will limit a trader’s potential upside profit if there is a significant move in the price of the stock upwards. This strategy provides little to no protection if the asset price moves downwards. Covered Call Example For the specific example that we’re going to cover today, we’ll take a look at JP Morgan JPM . The price information reflects the price of JPM back in July at the original time of writing for this guide but is just being used as an example If you were holding JPM stock in your portfolio before the pandemic, chances are that you are currently underwater. DISCLAIMER ***For the purpose of full transparency, I do not own or hold any JPM stocks*** I typically only hold stocks between 5 and 25 days. Stock Price Movement Recap For this example, we’re going to assume that I own 100 shares of JPM . If I were to purchase 100 shares for $96 it would mean that the capital requirement for this position is $9600. You’re probably familiar with the way profits move in relation to stock prices… but just to be safe: - If the stock increased to $106, or $10, I would earn $1000. - If the stock increased to $116, or $20, I would earn $2000. - If the stock decreased to $86, or -$10, I would lose $-1000. How Does A Covered Call Work? Sell one call option contract for every 100 shares of the underlying stock in your portfolio. The contract selected would ideally have a short expiration date of 7 days. You would choose an “out of the money” call at a higher strike than the current price of the stock. When choosing this strike price, you would typically choose a price at least one standard deviation away from the current strike price. In other words, choosing a strike price that you do not believe the current strike price will exceed before the date of expiration. If you’d like to learn more about this options strategy, or options in general, I have an awesome Options 101 Course. What’s the benefit of having a Covered Call for the stocks in my portfolio? It’s simple really. When you sell a call option contract, you will receive a premium. This strategy generates income when you don’t expect to profit from the movement of the underlying stock price. In this example with JPM , I received a premium of $55 for selling a call option contract at the price of $116. Provided that the underlying strike price does not move above $116, the contract will expire worthlessly and I will keep the premium I collected by selling the options contract. Let’s take a look at how a covered call will affect your portfolio with the same stock movements. - If the stock increased to $106, or moves $10, I would earn $1000 plus the $55 - If the stock increased to $116, or moves $20, I would earn $2000 plus the 55 - If the stock decreased to $86, or moves -$10, I would lose $-1000 but keep the $55 for a total loss of -$945 Why does this work? If you take the entire amount of premium you received and divide it by the number of days between no and contract expiration, you come up with a number like this: $55 dollars in 7 = $8(ish) per day. This covered call contract is paying us $8 dollars per day. If you take the $8 dollars, divide that by your total capital investment of $9,600 it equals 0.08%. This may not sound too incredible, but… If we do some basic arithmetic and take 0.08% and multiply that by 360 trading days per year, you end up with a return of over 30%. This is in addition to what you earned from the growth of the stock. On some stocks, it’s possible to earn upwards of $20 per day. This could increase annual returns in excess of 40% to 50% Does this sound a little more exciting? YES! Should you trade it? ABSOLUTELY! BUT…. There is a risk associated with this strategy. If there is a large movement of the underlying stock price that surpasses the strike price of your call option contract, you will be forced to sell your shares at this price. This would limit your upside potential to the difference between the current stock price and the price of the call option contract. Example: If the price of the stock went up to $117 (past the $116 call option) and the options contract expires, your stocks will be sold $117. This means you would earn $1,100 + $55, or $1,155. In other words, you would lose $100 for every $1 the strike priced moved above your call option contract. The silver lining is that you can probably buy your stock back the next day if you wanted to hold them long term. This type of trade can be taken inside of your retirement account such as an IRA, which provides you with another way to grow your account conservatively.
NYSE:JPMEducation
by rockwelltrading
The Biggest Mistake I Faced In TradingLet's imagine you decided to become a trader. You are very motivated guy, study technical and fundamental analysis every day. Three months later you have learned a lot of information, know all about indicators and chart patterns. Using these knowledges you developed your personal trading strategy, backtested it and decided that it's profit and accuracy are appropriate for you. It is time to make money using this strategy. The strategy triggered to the current price action and you executed, for example, the long position, but.... the price started to move down and you see that your deposit is decreasing. You say: "Okay, it is normal situation", but subconsciously afraid of the potential loss. You are monitoring the price action and waiting for the price reverse in the appropriate direction, but the price continue fall down. You decided to close the position before it is too late. You did it. And the next moment the price started to go up. Later you found that your position could be closed in profit, but because of your fear you lost money. The fear is the worst enemy of the trader. Even if you have the best trading strategy you will lose your money due to your fear. It is not easy to do but just imagine that your trading sessions is just a game and there will no bad effects for you despite your trading decisions. You should believe in your skills and destroy the fear to make money. This is the biggest problem i faced in trading! DISCLAMER: Information is provided only for educational purposes. Do your own study before taking any actions or decisions.
BITSTAMP:BTCUSDEducation
by Skyrexio
6
Short Selling Put OptionsI’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. Short Selling Put Options When short selling put options, a question people ask me is, “Okay, Markus, how do you decide what strike price do you want to sell and whether there’s enough premium in there?” I made a put options calculator called “The Wheel Calculator” that I gave away as part of my recent class on selling put options (Theta Kings) that helps me determine just that. This calculator is now also integrated within The PowerX Optimizer Software as well. Using my put options calculator, I can enter a few different figures and it quickly lets me know if this stock makes sense to sell put options on. I started a small account with $25,380, and have continued to grow it substantially. This was all done by selling put premium using my handy put options calculator! So let’s take a look at a few examples using the airlines. Here’s how you can quickly compare if an option makes sense to sell. So United Airlines UAL , at the time of this is trading at $31.08/share. So I’m going to take a look at the April 24th expiration and the $20 strike price. I’m thinking maybe it would be a good idea to sell the $20 United Airlines UAL put option. So now that I have the strike selected that I would like to sell put options on, let’s take a look at the premium these options have. This will let us know if this trade actually makes sense. Right now, the Bid/Ask is $0.74 over $0.87. So I probably can get $0.80 for selling this option. This is all I need to enter in my spreadsheet, along with the expiration. With the needed inputs entered into my handy dandy put options calculator it tells me, “United Airlines can drop 36% and you’ll still be okay.” It has to drop 36% before we get in trouble. I think that’s pretty good odds in my opinion. The cool thing is that it also says that based on my account size, I should buy 17 options, and I would collect $1,320 in premium. So this means that per day I would get $110 in premium. That’s not bad at all if I can make $100 on just one position. And I like to have 4 to 5 positions in my account at any given time. So based on the number of positions I like to have, this means that you can make $400 to $500 per day collecting premium. I like this a lot because it means annualized I would make 87%! 87% is nothing to sneeze at, right? Short Selling Put Options — American Airlines So now let’s do this same thing with another airline, American Airlines AAL , and see how the numbers look. So like we did with UAL , I’m looking at what strike price in relation to where AAL is trading would it make sense to sell. For American Airlines AAL it looks like probably the $8 strike price would make sense right here. You always want to do it below the previously established low. So let’s take a look at American Airlines AAL . The price right now is $12.26. the options strike price, we said we’d probably have to look at is $8. Here we’re able to collect $0.35 per contract at the $8 strike price. And you see, I could actually, since American Airlines is so cheap, buy 41 options based on my account size. So 41 options and I would collect $1,444 in premium. This means I would get $120. That’s not bad at all. And you see, American Airlines AAL also can drop 35% and we would still be OK. We only get in trouble if American Airlines over the next 15 days drops more than 35%. Possible? Yes. This is why you should always be willing to own the stock. And this is why you want to make sure that you’re not getting in trouble. You need to adjust your position size based on your account. Here obviously, I don’t want to trade two airlines because if airlines are crashing, they probably all do. With that said, let’s take a look at Boeing AAL . Boeing Example I like trading Boeing. I'm looking at a Boeing AAL chart to see where might be a good level here to sell Boeing. Based on where AAL is trading at right now, it looks like $100 would be a good level to take a look at. Let’s first try a strike price of $100, shall we? For $100 we get probably a $1.55 right here, with Boeing AAL trading right now at $150. So if we were to sell the $100 put option on AAL , we are looking to make $1.55/contract. And you see, this means that Boeing AAL could drop 33%, so we’re good here. However, we can only buy three options. Why? Because Boeing AAL is really expensive. So if we would have to buy Boeing at $100, this is when it gets expensive, right? So you see, the strike prices here are much, much, much lower. This is where you see I would only trade three not to overextend myself. And that’s very important when you’re selling puts. You want to make sure that you’re not overextending yourself because otherwise, you’ll get margin calls. Margin calls are ugly. A margin call means that your broker tells you, “I want more money.” You want to avoid that at all costs! Because if you don’t have the money, you would have to sell the stock at a price that you don’t want. Usually, this is how you can wipe out an account. Anyhow, you see this is how we would only make $43 a day. Let me ask you, what would you rather make? $110 to $120 per day? Or $43 per day? I don’t know about you, but for me, these are better. So it’s very easy to quickly compare which options you should be trading when you’re selling puts. One of my favorite trading strategies right now is selling puts. This is what you have seen in the past few examples. My goal is to make $400 to $500 per day by doing so. The best days to sell puts is on a down day. On a down day, the VIX is usually shooting up and options premiums are higher. This is exactly what you’re looking for as a premium seller. For experienced options traders, selling put option premium in an environment like this can be a great way to consistently generate income, even if the stock doesn’t do exactly what you want. I hope this helps!
NASDAQ:UALEducation
by rockwelltrading
1
The importance of having a plan and sticking to it!Hello traders Before I log off for the day (I'm in UK and heading to bed!) I wanted to share an idea on having a trading plan with an 'EDGE' but also having the trading psychology to stick with a trading plan. I'm lucky enough along with our fellow traders to run a script that has given us an 'EDGE' in the markets. This has enabled us to trade freely without emotional constraints. I simply place trades that appear on my charts then let them play out. I do this with no anxiety, no worry and no constant checking of the charts or my trading account. Here we have a short trade on EURAUD working the one hour time frame. This trade present last Thursday the 7th and I simply entered. I was then alerted by TradingView when the trade hit take profit on Tuesday the 12th. I've only just checked the charts now on how the trade played out candle by candle. As you will you see from the chart the trade played out with a good drop towards the take profit target before retracing back to near entry. After another little drop and another retrace to near entry the trade then headed down to take profit target. All of this happened with out me knowing! In my opinion this how trading should be! On this pair I have the script I use set to a take profit target of 1:3.4 and I always use a stop loss because realist among us will know not every trade lands. The script presents all the trade information on the chart when the algorithm sees everything is met accordingly to my settings. I simply take the trade and get on with the rest of my day. I'm able to do this as I know trading the pair in question by the manner describe above is profitable. How do I know this? The built in strategy tester tells me. At the bottom of this screen is the data from the strategy tester for the last 39 trades. This data is from two full years of trade data on the pair in question. Feel free to press the sub menus which show the performance overview and the list of the 39 trades. All data is based on 2% risk and a £1000 starting capital. No one can predict the future but this level of back test data gives me the confidence to go and trade in this manner. All of what I have described above is what has given not just me but all our traders an 'EDGE' in the markets. With that edge has come the ability to control emotions accordingly. Sticking to a structured plan is now easy and we trade emotionless with no fears or anxiety. I have left descriptions on the chart showing not only the entry and exit points of the trade but also a pointer where the old me would have been feeling regret, anger, anxiety and all the other bad feelings that can come with trading. Those feelings all used to come as a result of not having an 'EDGE' in the market to the level that I have now with using this script. For any more questions on the script in use feel free to ask any questions.
Education
by RichScott
1
How To Start A Successful Trading BusinessWhen you start trading, you need to go into it like you would if you were getting ready to start a business. Too often, I see new ‘traders’ who open their account and before ever mapping out any goals, a strategy, a trading plan, or anything, they’re already putting money into the markets… …and for me, this isn’t trading, this is gambling. So in this article, I’m going to walk you through how you can start your own successful trading business. So let’s dive in! Starting A Trading Business: Step 1 – Charting Software First, as a technical trader (like me) you MUST have good charting software. Charting software is your window into the world of stocks. As a technical trader, we rely on charts and indicators to find high-probability setups. Charting software with good indicators is an essential first step in your path to being a successful trader. I personally use (and highly recommend) TradingView. It is a paid service and for what I do, I use the Pro Version which currently costs $14.95 per month but it is well worth it. Remember, starting your own successful trading business requires a modest investment into the ‘infrastructure’ of your business. Step 2 – Finding The Right Broker Now on to step 2, finding the right broker for you! Finding the right broker can be a tricky process, especially if you live outside of the United States. If you’re trading stocks and options, I highly recommend tastyworks, or Interactive Brokers if you live outside the U.S. Starting A Trading Business: Step 3 – Trading Strategy Next, now that you have your charting software and broker, every trader needs a good trading strategy. Similar to the broker, one size does not fit all. Why? Well, there are a LOT of variables that can go into developing your trading strategy. For example, are you trading for Income or Growth or the amount you have to trade with? All of these things play a big factor in the type of strategy you want to, can, or should trade. Right now, I’m trading two strategies. My core strategies right now are, The PowerX Strategy and The Wheel. Step 4 – Trading Computer The next thing to consider when getting your trading business set up is you will need a computer. Almost all brokers and trading software are cloud-based, so you don’t need a seriously advanced computer anymore. Most computers that are less than 3 years old should be more than powerful enough to run even the most system-intensive trading platform. Step 5 – Additional Monitors. Now, for your home set up, I think at least one additional monitor is a must. The good news is that if you have a laptop, you already have one monitor! If you travel a lot (like me) I would highly recommend the ASUS MB169B+ 15.6″ Full HD 1920×1080 IPS USB Portable Monitor. They’re lightweight and work great on the road or at home. It fits easily in my backpack (because I HATE checking bags) and doesn’t add much weight. Step 6 – Trading Newsletters Next, over my morning coffee, I like to read a few different trading newsletters. I have three primary newsletters right now where I get most of my market-related news. Most of the talking heads on TV are absolutely terrible for getting non-biased information anymore. No matter what station, everything you hear is coming through some sort of filter. For this reason, I stick with these three newsletters that I’ve found to provide good info: - Morning Brew - Seeking Alpha’s Wall Street Breakfast - The Rockwell Trading Newsletter Summary Now that you have all of the pieces in place to start your trading business off on the right foot, in my next article I’m going to go through something that at first, I’m sure you will cringe: Trading Taxes. But I assure you if you’re proactive and take the time to get set up and structured properly, taxes aren’t actually as bad as you’d think for full-time traders. I hope this has helped and you’ve enjoyed it. Good trading!
DJ:DJIEducation
by rockwelltrading
Strategy on how to trade Lockheed MartinHey guys! Hope this analysis finds you having an incredible week, and ready for an even better weekend! Please kindly like this chart if you found this content helpful! Ok let's dive in! Lockheed Martin is still officially in a bear market. It is still 30% away from its all time high, with the technicals on the weekly indicating very tough days ahead for LMT holders. Tale of two stories here when it comes to very good fundamentals but very poor technical indicators. Ratio Time • P/E 14.64 (Very attractive) • Forward P/E 13.08 ( Boeing Forward P/E is 156.29 !!) • P/ FCF 27.57 • Debt/Eq 2.56 (Normally I would say this is really high in a different sector, but money is cheap right now and these guys are in a field that requires massive capital output...this is why if I see a level this high in a utility provider I am ok, but if I see a level this high in a financial or tech I run!) • EPS 23.4 • EPS this Y +25.8% • Sales Q/Q +8.7% • ROE +171% (again justifies that debt/equity level as they use debt very...prudently) • ROI +47% • Gross Margin 13.3% • Net Margin 10.2% (Stunning) ..especially when we see the rise in price recently in Boeing . Boeing has a 2.9% GM and a -7% Net Margin guys. Yes BA are losing money with a forward P/E of 156?? Holder Metrics • Insiders Own 0.08% • Insider Transactions over past 3 M (0.00) • Institutions Own 77.9% • Institution 3 Month Transactions -0.42% So what do we do when the technicals say run and the fundamentals say buy? We listen to both! The strategy I like to take ahead a potential trade when I see two conflicting tales are either run. Or wait for the technical indicators to display signs of a potential bottoming pattern. Next Chart will display pivot points . Finding a position at a lower price heading into the mean with good underlying fundamentals is a much better approach, although it takes patience and time as I think the idea of playing a short off the TA or a long strictly off the FA would be... short sighted. Best tactic is to embrace both and wait. Pivot points below! Friend please share with me & the wonderful TradingView community how you think we should trade Lockheed Martin! If you have a LMT chart yourself please be especially sure to share it with me!
NYSE:LMTEducation
by ZenMode
My Personal Plan For 2021I’m Markus Heitkoetter and I’ve been an active trader for over 20 years. I often see people who start trading and expect their accounts to explode, based on promises and hype they see in ads and e-mails. They start trading and realize it doesn’t work this way. The purpose of these articles is to show you the trading strategies and tools that I personally use to trade my own account so that you can grow your own account systematically. Real money…real trades. My Goals For 2021 In this article, I want to talk about my goals for 2021, and how exactly how I’m planning to achieve the goals, so I thought it would be fun to write them down and share them with you. Now, as you know, goals need to be specific, measurable, attainable, relevant, and time-bound. Now, I will show you my financial goals both for trading, because after all, this is what I love to do, but also for wealth building. After that, I will share with you the goals for my company, Rockwell Trading as well as my personal goals, and also my goals for this channel. FINANCIAL GOALS Trading For Income For my financial goals, let’s kick things off and start with trading. The plan here is to trade for income, and my target goal is to make $15,000 per month. This is meant to cover my living expenses. Now, here’s the deal. This is a rough estimate of how much I have in living expenses. So this means that I am looking to make $180,000 per year. For this trading plan, I opened a new account. I put in $250,000 into this new account, and it is a margin account. Since having a margin account doubles your buying power, this turns that $250,000 into $500,000 of buying power that I will use for trading to achieve this goal. To figure out how much buying power I needed, I needed to figure out my living expenses. So as far as I know, my living expenses are around $9,000 per month. You might be wondering, “If your living expenses are only $9,000 a month, why would I try to make $15,000 per month?” Well, very easy, there is this thing called taxes and I want to account for it. This cost is estimated. Quick side note. By now you may be wondering why I seem to be unsure of exactly how much my living expenses are. I will cover this later in this article. So, again, the goal here is to trade for income. My next goal is for wealth building. Wealth-Building Goals One of the avenues I like to use for building wealth and one I’ve very knowledgeable about is real estate. So the plan here is that this year, I plan to buy a 10 million dollar apartment complex. Now, I’ve already been investing in apartment complexes for the past few years, but the rough idea of the financials is: - 7 million dollars will be used through financing. So I will find a bank that is basically financing 30% of this. - I’m actually planning to raise 2 million dollars through investors. - The last one million dollars will be my own money that I’m putting into this deal. This is very typical for how investing in commercial real estate is done. Now, here is the plan. The goal is to sell this for 15 million dollars in three to five years. So we’re selling it for 15 million. Then, of course, we have to give back 7 million dollars to the bank, right? Because we’re borrowing 7 million dollars. 2 million go back to the investors because everybody needs their money back right? Then 1 million dollars will need to go back to me because I also want to make my money back. Now, this is only ten million dollars. That leaves five million dollars in profits that can be divided among the investors and me. So essentially, I’m planning on making two million dollars based on the one million dollars that I invested, which would be a very healthy return. Throughout this whole process, I’ll show you exactly how this process unfolds as it happens, and what apartments I’m looking at with video updates on my YouTube channel as they happen. My other plan for this wealth-building goal is possibly buying a resort in Mexico, and here’s why. Those of you who already follow me know with my company, Rockwell Trading, we do have a Mastermind program, and we have Mastermind meetings at least three times a year. Now, recently due to covid, we weren’t able to have these in-person meetings, but if buying a resort in Mexico is feasible, then not only could we host our Mastermind meetings here in the future, I can also rent these rooms out for Airbnb. Now while I have experience with real estate, I’ve never been in the hotel business, so this might be a really stupid idea, but maybe it is a good idea. Right now this is just a goal, and will look into the details deeper to figure out if this will be feasible. Cryptocurrency So we talked about trading for income and wealth-building with real estate. My next financial goal has to do with something that I definitely have on my radar is that this year, and that is cryptocurrencies. Some of you know that in the past, I’ve been very, very public about being completely against cryptocurrencies, but I can’t deny that Bitcoin had a fantastic run this year. Bitcoin is now trading above $30,000. So guess what? Seems I was wrong. Moving forward I will definitely be looking into Bitcoin and other cryptocurrencies more closely, and fortunately, I have access to some fantastic resources of experts on cryptocurrency that I will interview for myself. I will also share these findings with you on my YouTube channel, and future blog posts throughout the year. My Goals For Rockwell Trading At my company, Rockwell Trading, we offer The PowerX Optimizer Software, and I am determined to make this the very best software in the world. For this, I am planning to release PowerX Optimizer 2.0 in the first quarter of this year, and I’m also developing an awesome trading log that will be integrated with PowerX Optimizer. So why do you need a trading log? Well, with this trading log it will be easy for you to analyze your trades. We all need to analyze our trades, and so this is definitely something that I will tackle this year. One other feature that I want to look into is possibly being able to execute trades through PowerX Optimizer by integration with actual brokerages. As it stands right now, you use The PowerX Optimizer to find stock, and then you have to enter the trades into a broker platform separately. I want to see if I can make this process easier, because, I have the same challenges. I see it on PowerX Optimizer, and now I have to enter it into the broker platform, so not only making trading easier for myself, but for everyone who uses The PowerX Optimizer. I’m constantly thinking of ways to improve The PowerX Optimizer, because not only do I believe in it, but I believe in Rockwell Trading as a whole. I believe this company, Rockwell Trading, can be an Inc 500 company. I am super passionate about trading, creating the best trading tools, and showing you the very best trading strategies that you can use to grow your account. It’s because of this drive I have to provide awesome value for you, that makes me believe we can make their list of the fastest-growing companies. Now I’d like to move on and share my personal goals for 2021 with you. PERSONAL GOALS Writing More Books The first of my personal goals for this year is, I want to publish two more books. So the first book, as some of you are already aware, will be on The Wheel strategy, which is a trading strategy for trading options. Right now I’m in the process of giving the book one final proof-read before sending it to the printers, and I only have a few more chapters to go, but I will be rolling this one out shortly in the coming weeks. The second book I’m thinking about writing will cover wealth-building strategies, which will cover what I’ve been doing over the past years to become a multimillionaire. When I came to the United States in 2002 18 years ago, I had $30,000, and today I am a multimillionaire, so I know a thing or two about how to build wealth. I think this would be another great book to share with you, that you can get a lot of value from. Buying A Plane Here is an absolute crazy personal goal that I have for this year, and you might actually say that this is a stupid idea, but for years I have been dreaming & fantasizing about owning a private plane. I’ve decided that 2021 might be the year where I make this a reality. Now again, this could be an absolutely stupid idea. Don’t get me wrong, I’m pretty smart about how I spend my money, and I’m not planning to buy a 10 million dollar jet because here’s the deal. A private plane is an expense, not an investment, right? However, everybody is allowed to spend money however they want, and this might be one of the things that I decide to splurge on. For other people, it might be exotic vacations, for me, the idea here is a private plane. So it’s smaller like an executive plane, and this is the kind of plane that I’m looking into. I’m definitely not planning to fly it myself, so no worries there. I’m planning to have a pilot fly it for me because I have no idea how to do this. I will look deeper into this and see if buying a plane actually makes sense or not? These are some of my personal goals. Now, in terms of habits, there are also a few habits that I want to start doing this year. HABITS Keeping Track Of My Finances First of all, I want to track everything. What do I mean by this? Well, when I say track everything, I want to get better at tracking my wealth, which would be my net worth. Now I have a rough idea of what my net worth is, but I should be probably getting much better about this so that I know at any given time how many millions I have. You see, the challenge is once you have money, it’s not that important anymore, but I want to do this and I also want to get a little bit better about tracking my expenses. Remember earlier, when I was talking about how I wasn’t sure exactly what my monthly expenses were? This is where being better at keeping track of finances, as a whole comes into play. I said that I’m planning to trade for income on my YouTube channel and that I think I need $15,000 a month, but I actually don’t know exactly how much I need. So I need to get better about keeping track of my finances. Health & Fitness I also want to get better at tracking my weight and calories. I’m 51, so I’m getting older, so it’s important to take care of this. I want to track everything from my water intake, calorie intake, and what kinds of food I’m eating. I also want to keep track of my workouts, and as of now, my workouts are very, very easy to track because it is actually zero, so I want to be better at getting exercise as well. My YouTube Channel Now how does all of this affect you? I mean, why would you even care about all this? Well, this is the beautiful thing about my channel. If you’re interested in what I’m doing with these goals, I’m planning to post videos there throughout 2021. Five times per week, I will post a daily stock market update. I used to talk about what was going on in the markets during the “Coffee with Markus” live streams. These are now separate, daily videos, 5 days a week, and this will be in four minutes or less. Two to three times per week, I will continue the “Coffee with Markus” live streams, but without the market updates, as they will now be in the other videos. I am planning actually keeping you updated on the wealth-building strategies I was talking about, with video updates. I will post videos updating everyone on the progress of my goals, and, of course, I also will continue to post videos covering the very specific strategies that I will use for trading. When it comes to trading, I will continue to show you exactly the two strategies that I’m currently using, which is The Wheel strategy, and the PowerX strategy. If I decide to trade any other strategies this year, I will post videos about that as well. I will share videos with my real estate adventures, which as of right now, is where I’m planning to invest in a 10 million dollar apartment, possibly buying a resort in Mexico. I’ll be sharing everything with you, the good, the bad, and the ugly. I also want to cover topics I haven’t covered before, for example, credit cards. I have a bunch of credit cards and I’m using them wisely, so for instance, topics about credit cards like, “The Apple Card, is it worth it?” I have 3 American Express cards so I’ll cover whether or not they’re worth it. I also can tell you that right now I have 650,000 airline miles, so I will show you exactly what I’m doing to get all of these points because, with 650,000 airline miles, you can go around the world several times. Another topic of interest is that interest rates are low right now. So we will talk about, for example, LOC these lines of credit, or does it make sense to refinance your home? I have been looking into refinancing my home and I will let you know what I found of whether it makes sense or not, and other strategies to employ when interest rates are low, and then when interest rates are high. For example, when interest rates are high, I will cover high yield savings accounts as well as CDs. YouTube also has these so-called “shorts” and these are videos below one minute or less. These will be videos that I do as a quick reference guide. So for example, what is the bid/ask spread? What is Theta in options? Recap So let’s just briefly recap, I wanted to share my goals with you for 2021 and they are: - Will publicly trade here for income with a new $500,000 margin account, with the goal of making $180,000 a year. - For wealth building. I’m planning to buy a 10 million dollar apartment complex, and am looking into buying a resort in Mexico for the Mastermind meetings for Airbnb? - I will look into cryptocurrencies and see which cryptocurrency. Does it make sense to invest in Bitcoin? Are there any other cryptocurrencies worth investing in? Is it better to maybe invest in gold or silver? - I will look into publishing two books. - Improving the PowerX Optimizer Strategy. - I’m looking into if a private plane is a stupid idea or not. - Keeping better track of my health and finances. - Becoming an Inc. Fastest Growing Company. - Providing more content on my Youtube channel. So long story short, this will be an exciting year. I am super excited for 2021. This is the first time ever that I’m doing anything like this, and I will really be pulling back the curtain throughout to show you everything that I personally do. I hope that you find this not only interesting but that these are also strategies that you can employ in your life right away, but this really depends on what stage of life you’re at. You might be at a stage where you are still trading for growth, trying to build an income, and I will show you very specific trading strategies for doing this. It might be that you have a retirement account and you’re looking back right now. You’re getting your initial statement and you say, “You know what? This hasn’t been doing anything over the past year and I want to have better wealth-building strategies.” If so, there will be videos on my channel as well. Sometimes you might be wondering, “Does it make sense for me to open an American Express account or to have an American Express credit card?” Or something relating to this. And I will share all of this with you. Hope that you’re enjoying this. And this is what you can expect from me in 2021.
TVC:NDQEducation
by rockwelltrading
3
Why one cannot be completely bullish or completely bearish? Why one cannot be completely bullish or completely bearish? The stock market consists of two major players. Some people are long traders they bet the stock price will go higher. They buy low and sell at a high price to make a profit. Some long traders buy the stock at a high price and sell at an even higher price. Some long traders look for bargain stocks. Some other people bet the stock price will go lower. They are short-sellers. They don't own the stock initially, but they borrow the stocks from the stockbrokers and sell the stocks from a high price, then when the price drop they repurchase the stocks back at the lower price, return what they initially borrowed with interest back to the stockbrokers, and then profit the price difference. We can interpret the security market as a continuous tug of war game between the long traders and short traders. Sometimes one side will win the game, and in that situation, the price will advance higher or lower. Sometimes one side will gain strength that means the price will speed up and advance faster. Sometimes one side will win, but then go in the opposite direction temporarily and that is a correction. Sometimes one side will win but will lose strength completely and reverse direction completely. Due to the rapid changes in the security market, one trader cannot be 100% bullish or 100% bearish. Therefore, a market opinion may be "I am 70% bearish, and 30% bullish." That simply means that I am 70% confident that the price will go lower, but I reserve 30% market opinion that the price may hit a bottom and may reverse direction and go higher as the market story develops. When that happens, I am ready to liquidate my short position and willing to participate in the opposite direction or stay on the sideline. Thank you for reading! Greenfield Remember to click "Like" and "Follow!" Disclosure: Chart interpreted by Greenfield. Just a market opinion by Greenfield Analysis LLC for only educational purposes. This is not a recommendation. Greenfield Analysis LLC has no investment in any of the securities mentioned in the article, and no plan to initiate a trade in any of the securities mentioned. Greenfield does not receive any compensation for this writing. Investment involves substantial risk. You should consider carefully before making an investment. Investment at your own risk.
NASDAQ:NFLXEducation
by GreenfieldAnalysis