How to Identify Trend Exhaustion
Information from the trading pit is no longer available because most trades are executed electronically. However, the lessons I learned from dealing with professionals and reading order flow still resonate. Be sure to answer all the questions on this list before entering any trade to think like a pro.
Are Bull Calls and Bull Puts the Same?
Information from the trading pit is no longer available because most trades are executed electronically. However, the lessons I learned from dealing with professionals and reading order flow still resonate. Be sure to answer all the questions on this list before entering any trade to think like a pro.
Seek the Answers the Pros Do
Information from the trading pit is no longer available because most trades are executed electronically. However, the lessons I learned from dealing with professionals and reading order flow still resonate. Be sure to answer all the questions on this list before entering any trade to think like a pro.
Holding Yourself Accountable This Year
Who likes to do chores? If you are like me, there are definitely other things I would rather do. That said, when you have completed your chores, there is a sense of accomplishment. Whether it is cleaning your closet or basement or organizing your budget, the new year is a good time to get things in order. But what about your option trading? Have you thought about taking an inventory of your trading in 2024 as one of your chores? If not, you probably should put it on the list.
How to Use Velocity Indicators
Given the recent jump in volatility for interest rates, equity and energy markets, I figured it would be appropriate to introduce a few of my preferred velocity indicators.
IV Rises as Earnings Approach
As a trader and teacher, my tangible tool is a chart. Math is required to calculate my preferred market indicators, and the graphs I favor illustrate psychological and sociological behavior. As for the spiritual part, it is the euphoric feeling a trader gets when all the hard work and analysis pays off as a lucrative trade that involves minimal risk.
Tools of a Trader
As a trader and teacher, my tangible tool is a chart. Math is required to calculate my preferred market indicators, and the graphs I favor illustrate psychological and sociological behavior. As for the spiritual part, it is the euphoric feeling a trader gets when all the hard work and analysis pays off as a lucrative trade that involves minimal risk.
Don’t Let Your Emotions Get in the Way
Trading isn’t just about entering positions—it’s about managing them effectively. As I often say: “Know what you will do no matter what happens before you enter a trade.”
For a bull call spread, consider profit targets, stop losses, and multiple exits to adapt to market moves. A solid plan minimizes emotional decision-making and sets you up for success. Preparation is key.
AMZN, AAPL & RCL Wheel Trades
It was an interesting Monday this week for my wheel trades. AMZN and AAPL have just been on fire lately, and I’ve had covered calls on them for a while now. Lots of rolls,
Putting Credit Spread Genius to Work
A scanner is a great way to find trade ideas. In Group Coaching class, we often model out vertical credit spreads, many of which come from MTM’s Credit Spread Genius scanner.
How Straddles and Strangles Work
Straddles and strangles are strategies option traders can use when they think a move in the underlying is imminent, but the direction is uncertain. Sounds like a can’t-lose plan, right? Well, obviously, if it were that easy, we would all be trading them, all the time. Let’s take a closer look.
The Market Needs to Be Your Friend
This post is just a friendly reminder to remember what kind of market you are trading in. Over the past several weeks, the market has been extremely volatile.
Option Trading and Life Are Not Perfect
When it comes to trading, we try to put the odds on our side to create a better opportunity to extract money from the market. Many traders do this by using technical analysis to gain an edge. Here is a brief reminder that you need to keep trying to put the odds on your side even though it may not always work out.
Don’t Always Bite on a Bullish Base
As an option trader, I am always looking for an edge on a trade. Quite often, and especially with the market moving higher, multiple bullish bases present themselves. A quick definition of a bullish base is when the underlying is in an uptrend and then levels off but does not pull back much from recent […]
Hard Profit Taking Option Orders
Here is a topic I cover daily when it comes to options trading. It is so important that I cannot go a day without bringing it up several times in MTM’s Group Coaching class or with students in a one-on-one environment. The topic is always having a hard profit taking target when you have a […]
Get Rid of Unwanted Positive Vega
Implied volatility (IV) levels have drifted a little higher recently. At some point, the market will sell off and they will rise even more. If you initialize an option position with positive vega when IV is high, this might be a bit concerning for you. But there is a way to help neutralize that vega. […]
The Strange and Recent Evolution of Option Traders
Everyone seems to be trading options these days. OK, not everyone. But a lot more people than there used to be. And sure, we know options are valuable tools and it makes sense for a lot of people to trade them. But where did they all come from and why all of the sudden? Well, […]
Resistance Works Better Than a Hunch
For about a month and a half, the S&P 500 ETF (SPY) has not been able to set a strong all-time high because of some major resistance. As I often remind traders who follow technical analysis, resistance like support has a much better chance of keeping the underlying from moving through that level. I would […]
Vertical Spreads Are an Option
Although most option traders do not live on buying calls and puts alone, they often forget to look at vertical debit spreads as well. Too many times they go straight for a vertical credit spread. By no means am I implying not to trade vertical credit spreads, but I believe too many traders automatically default […]
Is It Time to Change Your Trading?
Every so often I like to give a pep talk, and as we enter the last quarter of the year it seems like a good time for one. If you are an option trader, you know how difficult it can be to extract money from the market on a regular basis. Let’s be honest: Most […]
Hedging Like a Pro: Why 0DTE Options Outshine Gold
Hedging with gold is one of the most classic moves in the financial playbook, and for good reason. It’s been a reliable store of value for centuries. And still to this day, gold is the universal hedge. Let’s take a look. First let’s talk about inflation. Over time, we know that inflation can chip away […]