Technically Speaking: Trading Stocks and Options | Swing Trading | 4-30-19

Technically Speaking: Trading Stocks and Options | Swing Trading | 4-30-19

Show Video

Good. Afternoon and welcome to our technically, speaking. Trading. Stocks and options I'm Connie Hill I want. To welcome you here today every, single one of you whether this is the first time you've been here or if, you, are returning, veteran, I see a hello from Bobby hello, Bobby as well. Happy. To join you today. We're going to focus on something that, sometimes. Is. Left. Out of focus, when, we do some trading and that. Is position, sizing and. We're going to go through several examples, as well as analyzing. And looking at some trade, management from this last week. So. Stick with us because I'm, intending. To show you so a few things that I wish I have, known and, did sooner. Than when I caught on to all of it all, right. We. Will be using some option, strategies, today. Options. Are not suitable for all people. Or, all investors as special risks inherent options. Trading makes. Those investors, to potentially, wrap it in substantial, losses. Spread. Strategies, such. As battles, and other multi black option strategies, can entail subs and substantial. Transaction. Costs which may impact any potential, return. In. Order to demonstrate functionality. The platform, we need to use actual symbols but TD Ameritrade does not make recommendations. Or, determine. Suitability of, any security, or strategy, and the, investment decision you make in your self-directed, account, is solely your responsibility. Paper. Money which we'll use here today is, for educational, purposes only and as. We use that I want you to keep in mind of that it's a great tool, for you, to use alright. As you're, practicing some, of these things past. Performance, of any security of strategy, does not guarantee future results or, success. While, this Brad webcast. Discusses, technical, analysis, and other approaches. Including, fundamental, analysis. May. Assert. Different, views. All. Right here's a little just a little bit of information about me I've been a coach here at TD Ameritrade since, 2004. And, really. Enjoying sharing, with you some of the things that I've learned along the way as it, fits in with the things that we're discussing here now. Our focus in this class is really a lot on technicals, right and in. This case applying. It to sometimes. Stocks sometimes, options we're gonna use the both, of those today. Now. We had been working on our short term options, and. One. Thing I just really, wanted to focus on cuz I we. Didn't do it as well as I wanted to last week were. Trade. Management, techniques, so, we're gonna have a little follow up with out on our trade with Apple, and, then. A risk, probably. A risk and position, sizing and then, of course we'll be using the thinkorswim paper money as we do that all, right so let's jump out here I. Should. Mention to you this is more of an intermediate level class it's not intended. To be a beginner class so we me talk through some strategies, you, might not be familiar with in fact we're going to talk through some options strategies. If, you aren't familiar with options, going.

To Barb Armstrong's, class, I think first is on. Monday. Morning, I'm. Gonna, get the right time here, at. 9. O'clock Eastern. No. One I think it's actually 11, o'clock Eastern, is her getting started with option strategies. Ok, so as you go along you're like man you're talking about stuff I don't get I don't know that's. Ok we'll. Get you to the right class so you can follow along and enjoy. It as well. Well. We have in our paper, account, our, sample. Class account we had a trade going on with Apple. And. I'm gonna zoom in even maybe a little bit more with. Apple, we had the following going, on we. Had seen. Maybe. Let me get to to the side here let's move that over there. We. Have seen this upward trending stock and then, we saw this sharp. Vertical, rise up which. Looks like a flagpole, those. Of either. Comfortable in and, understand, price, patterns. That's, a pole and then, we saw this action, here where it consolidated. And. What, we call will a flag, alright, okay so just imagery, think of your flag, hanging. Out, off. Your front porch wherever it is and. That. The flagpole, makes, a very sharp, move up okay. It's not like laying, on the ground barely above the ground but. The flag itself, does consolidate. And then, what then you look for a breakout, now. A couple of weeks ago before a class started, I, looked. Like it was breaking out alright, so, we entered a trade in it for our class, and. By the time we actually had our class, the. Price, had pulled back so it was just barely, breaking out, but. Sometimes people will get on in, on intraday, moves and intraday. Breakout of that flag consolidation. Some. People might wait till the end of the day to see if it really stays there or not in, our case, we. Entered it in and took a look at it once class, came along, now. Last, week, when we met this is what the candle, looked like it's. That very candle, okay. So it was moving along. It. Had not hit, its intended, target, yet. And. I say its intended, target would be the length of the flagpole again. So. Up here near the top let's see where that went to, 211. And some change. Did. Not make it quite there but what, happened, next, day. After. Our class it runs up a little bit and what does it do it starts, selling off do. You recognize that candle. That. Is kind of a kind. Of a dragon, star doji candle. Till. Might not be or the shadow might not be as long on the top as we typically might want to see it but. It's still the same idea the idea that it tried to run up ran. Out of steam dropped down and closed. A little, bit lower than whether yet. Opened. So. Let's, see what did we do here. So. We recognize, that for, that short-term swing, trade we. Recognize, well, 211, was a nice place to go but it's not gonna make this right. And, let. Me show you I did a screen shot for us that day. So. This is a paper I call my trade watch and if something happens during, the week that, I want to report back to you on that I'm keeping track of then I'm gonna put it in on here so, on our Apple trade we got out the next day on. April, 24th, on that dragonfly, doji, the. Price here. We. Are in at 7:45. And our. Exit, price was 11:25. That gave us 380, of, profit. Per contract, not including, commissions, multiply. That out by three contracts, it's, about eleven. One. Thousand one hundred forty, dollars which. Equaled, about a. Fifty, one percent gain. Over, about six days. Now. When we talk about short, swing trades, we're just looking to ride that, swing of momentum, and, if it runs out for is the target it runs out, but. You want to be quick to. Walk in your gains if you can now. I just, out. Of curiosity because, you can see what the chart looks like today. Out. Of curiosity I, wanted, to go see, what. That strike price, was worth now. Supposing. That it hadn't, have been cashed in okay. So let's, uh let's. Minimize this, knowing. That. 11, let's, see. 1125. Was. The price on the exit okay, let's go here let's go to the trade tab let's. Go to Apple. That. I might need this up on my other screen to keep track of it. We. Had this for. Okay. It's not a BM let's bring up Apple. These. Are some other positions, from a different class okay, so don't. Worry about the position, there and a by order I. Believe. These were make contracts, we may have to go back here.

To The. Monitor, tab account, statement, I've, gotta identify a particular, statement. Let's. Go to our margin account. We've. Got Apple RT in there. There's. Our 30 contracts. That's. The order history trade. History in the last 10 days shows. It. Was the, May, okay. May, 31st contract. So we have gone with some weeklies in that one there's, our 1125, price okay let's. Come back here and see what the May 31, so. Let's collapse this and. This. And let's expand, the May 31, the. Weekly and our strike price here. Was. I'm. Have to go peek I forgot to. Memorize, that let's, go back here we'll just real quick. 200. It was the 200, calls we had there. Alright, so we'll come down here to the 200. And. I'm just gonna highlight it here. So. If, we had held on to that, contract. Seen, the weakness seen that'll pull back and just said mm maybe we'll decide to write it out if. We had in our class, the. Price of those options would. Now be, worth, less. Than, what they were when we purchased, them initially, at 7.45. Cents. So. As an option buyer. We've. Experienced. Or would have experienced, in this situation, a run-up, of the price a pull, down on the price and not, walking in the gains in fact we, would essentially be negative, on the trade now because if we wanted to sell it we. Could only get 705, out of it okay. So, that's the idea with the swing trading is take, advantage, of that momentum as it grows now. As you have questions, I want you to chat them in those of you that are logged. In we've got rusty, who's in Houston. Terence, I'm not sure where you're coming from but. I imagine you're all sign, out as, we get out of winter fact. We're flying out here in Utah, and. I. Believe. That there's a lot of pollen, in the air we have such a wet, wet, winter, fact, we're probably gonna get snow in our mountains again tomorrow or tonight. But. Things are blossoming down, here in the valley and I sound, a little bit hoarse that's why I think, it's just a little pollen, in the air. Well. Let's go to the next task on hand. And. I, kind of have this written down here as an agenda item, now. We're gonna position size. For this. Is a type of multiple, traits not multiplier. Trades okay. Well. What are we going to look at we're. Gonna come over here on, the charts, and I. Was looking, at let's. Get rid of this on, this side let's get rid of that side bar I, was. Looking at the nasdaq-100. It. Just kind of go along we're an earning season right trying to find a stock that maybe he had a potential, set up according. To the rules that we've talked about either. Maybe a bounce a break out a cold, cold. At the end of the day I could hold at some point in the day although. It couldn't be a closed above the high of the low day for his first thing in the morning but it could be a move above. The high of the loading and, there. Was one here that I was. Able to identify that I know, we thought might be worth looking at okay. Again. Doesn't. Mean it's perfect doesn't, mean it meets your rules. Doesn't. Mean the, things we talk about here you should absolutely do, okay. This is a good example trade, so we can review some principles, okay. So. We can see a general uptrend, in. Broadcom. Looks. Like they got there or have their earnings with a little pop.

Up In March. So. They probably really want to have their earnings, until June. Sometimes. So don't. Have early, ins lurking, around the corner that we can't see. Looks. Like the stock rallied, up made. A new high 322. For. The year it, pulled back well, where did it pull back - it's, kind of interesting the area that it shows it, pulled back it shout out to the 30 day moving average, and then. We can also see in here this was old resistance. Around that 306. 307 area. Stock. Came back to it touched it a couple times and bounced, up off of it. Now. If. You're, looking for a close, above. The high of the low day. This. Would. Have been our low day here, right we can see the stock went down there the lowest, the. High on this day that we'd be looking for an entry on the next day which was yesterday. Would. Be a close above 310 95, and. It looks like it closed at. 312, 72. So. A couple of bucks yeah it. Did close above, that. Now. Some. Of you might think well for a sweet trade maybe that's too late and, it could and it might be it. Could also be if you're somebody that looks, at charts. At the very end of the day maybe you're working all day and you come home at night and look at them it. Could be that you say okay it's about that entry condition, let's, set up a conditional, order to go ahead and get in fact, we're gonna do a follow-up on one of those as well. Alright. So, this. Could, be, some. Confirmation. Of the cold if. You're getting into a stock. They're gonna hold for a shorter, period of time, some. Of you might not feel as comfortable with that unless you have a pretty good target in mind. If. You're doing an intermediate. Trade. You. Don't have to be johnny-on-the-spot right, you don't have to go down there and pick it clear, off is low. If. You wanted, to you could be that aggressive with a naturally you don't have to you to, really have a, trade. That. You feel good about the entry on okay. So what I wanted to do with this little stock is. Propose. Some, trades on it and do, some different. Position, sizing rules. Now. I have to tell you for those of you that don't see this Terrence. Is joining us from Argentina. Now. If I use if I say that with my my. Broken Spanish accent, I'd say I didn't Tina. And. If anybody else is in Argentina, hola. I do. I do, know some Spanish at least I've retained something, alright. We. Can see the, MACD, is rolling, up here so. We see oh it's gaining some momentum on the MACD, if that's an oscillator, do you like to look at try. To keep this pretty simple blue. Line is 10 day exponential, moving average, red, is the 30 day exponential.

Moving Average, so both of those are heading, up. Indicating. Short-term trend is bullish, intermediate-term. Is bullish, and just with your eyes you can see it's. Making higher highs and higher lows you, can just see that throughout all, right. So. Let's. Say let's, take a look at this. Suppose. Well. Let me let me back up for a moment in our portfolio. For our class. We. Have granted, and allocated. Out of the total, about, 150, thousand dollars, that. We can do and use in this class and we're not anywhere, close to using, that amount but. If you had a hundred and fifty thousand dollar portfolio, you. Could if you wanted to say you know I want, to break that up into X number of pieces if, you want to break it up into, say. Twenty. Traits, then. You might say I'm not going to put more than seventy five hundred dollars, into each, trade, meaning. Investing, into it. Maybe. You feel. Like you have, some positions, that you're interested in that you'll like and you, don't want to be stretched, out far to have to check up on so many positions you, know maybe you're saying okay well not put more than 10% of, my, portfolio into. Any single position. So. It'll, just depend, on you there's, gonna be some of you there are self-directed people, that. Ten. Positions, won't bother you I do. Recall once upon a time talking, to a man about. About. 94, positions. Open. At once and. We discussed, is that hard, to manage is, that hard to stay on top of them and he said well it's not but that's all I do. Right. He doesn't even leave this computer, during the. Days of the market he just sits there because he was trying to manage so much so. He may have changed his mind okay, but, you'll have to find what's right for you. All. Right so. We have, $150,000. Let's. Go on the assumption will make the math really easy and you might not choose these numbers that, you're. Willing to put 10% of that account into any one position so that you could spend. $15,000. And that, means invest, that. Doesn't mean risk that doesn't mean loose that. Means how much money you want to dedicate to that position. And. That's one way that people do diversify, their portfolio. Now. There's another way to people may diversify. It and manage. It and position size it and that's by the risk and it's. Determining, how much risk there is on a trade, and. Seeing. How many shares you shouldn't buy more, than to, exceed that risk. So. Let's start first with stock stocks pretty easy to do this with. And. So let's do this. Let's, suppose, you're. Willing to put in ten percent but you're not willing, to risk more, than one. Percent in any single, trade, okay. You're, only willing to risk or, lose not. That any of us like losing, but. Well, maybe somebody does I don't. Actually know, everybody. But. Maybe. You're willing to risk one percent. Let, me stick a one in here and that. Would mean $1,500. Meaning, things, go wrong in the trade it comes down it hits its stop-loss you. Get out pretty close to losing 1500, bucks if, a stock gaps down. You, might incur a little bit more of a loss. For. Stocks gapping, you probably have seen that before, okay. So let's look at this guy this, is. Kind of an expensive stock right three seventeen forty one and, with. It being a little bit of an expensive, stock in our portfolio, you might think it's limited in terms of what we could do with it now, I drew, on this line or drew in this line, 306. 82. Where. You, know some people might see previous. Resistance, and new support, and maybe. Saying well maybe. A stop list could go, stop-loss. Could, go 3%, below, that. Area. Some. People might say you know it's only been three days ago it went as low as, 3:05, 11 and they, might based their stop-loss, off of this or they, may base it off of something totally different if, it's appropriate they might base it off the moving average which happens, to be about the same as that's, 306. 80. Mm-hmm. All. Right. Now. Let's let's, use the low of two days ago let's. Use, 305. Eleven, so. We're gonna change, our, watch, list here to a calculator. On our gadgets. And. I hope this cooperates, with me today, so. We're gonna go. Three. 3:05, 11. And. Then. We're gonna multiply. That, by point, 97. Well why point ninety seven. Because. Point, 97, times that don't. Work tells. Us what's three percent below that number three percent below that value let's. Try that again. 305. 11. Well. I, got, the right numbers in here two times. 0.97. There. We go, to. 95. 95. I'm. Gonna stick your mouse in that area make sure it makes sense to you if you put your mouse in this area you know, if I still get about it do another calculation I, do, something, else it doesn't have to be this exact spot.

And. But. That is a possibility, on this one so. If, we say 305. So. Let's do this let's write. Stop. At. 295. Point. 95. Then. What would the risk in this trade, be, okay. So the risk in this trade for the stock. Is. Going to be current. Price, 317. Point, 27 minus. 295. Point. 95. So. We would be taking a risk on the trade of 21. Point, 32. Okay. So let's run through what that means on this so. If we're risking. 21. Dollars and 32 cents, to. Buy some shares of stock. Let's. Take our risk of. $1,500. And divide that by our, risk. In the trade okay, we, don't want to lose. More. Than $1,500. And so. Let's divide that by twenty, one point 32. That. Tells us we could buy how many shares. Seventy. With. That particular, formula, we could do 70 shares. Now. Suppose. We really, did buy all 70, shares let's see how much money we might spend. I'm. Gonna leave those decimals, in there well actually what let's, clear them out so we'll say 70 times per price, of the socket 317. Point 2. We. Would be spending twenty, two thousand, two hundred. Now. If you wanted, to make sure you weren't over. Going. Over fifteen thousand dollars per position, then. You'd have to look at that and say nope we're not gonna do that that. Weighs the boats you heavily. Couldn't. Puts us more than ten percent over what. We want to allocate per, trade. Okay. Then so, what. Do you do then. You just say oK we've got to use our fifteen thousand dollars if that's the one you're gonna go with. Fifteen. Thousand. Dollars. Divided. By the current price of the stock is three seventeen. Thirty one, that. Gives you about forty seven shares. And. So sometimes people will just pick you, know they'll. Go through this scenario sometimes. They'll pick one number sometimes they'll pick another. Sometimes. They'll pick the number that puts them the, least out risk. Okay. Because buying 70 shares puts. Away above. That fifteen, thousand dollars per trade okay. So, forty seven, is going to be the magic number we're going to use now, if. If. You. Would like to see if this pulls back during the day great. Mohnish. Make sure it still has a cold, that, it's reinforcing, it but, I will say it has kind of grown a little bit as the days gone on but many times we'll see stocks pull back so. This might not be the absolute. Best time, of the day but. Guess what is the only time we're meeting for a class so. We better take advantage of it. All. Right don't really need the options right now and, so. Let's go put in our price, here. Let's. Just do a buy. Custom. With a stop, we'll, put it all in at the same time we're. Not gonna say this as a swing trade per say, how. Many shirts are we gonna do we're just gonna do 47. Should. You feel bad that you're. Not doing 50, or 100, no don't, feel bad don't. Worry about that at all. Current. Price. Is kind, of, adjusting. As the markets in play right now and. Then we need to put our stop price in here. Yeah. To 9525. And. Make. This good till cancelled, okay. You don't want to go set your stop-loss up every day that's kind of tedious. If, you wanted to get it a little bit lower price today you can adjust the price here. You. Can do whatever you want with that price I'm, just gonna keep what flooded in, all. Right and we're, gonna hit confirm, and send read. Through it make sure it represents, what you want you're gonna see you Commission in there five dollars if you, want to in a sub-account you, can put it in a sub-account I'm going to put it on our trading stocks and options account. We're. Gonna send it off and, my. Expectation. Is we're gonna get filled and we did get filled rather quickly now. Go, back to the chart here what if you were a person that. Looked at that and said you know I think, for. You. Know you're thinking for yourself maybe. You wouldn't mind doing a short put vertical on it different. Type of trade do. You want to get in quickly, yes, do you have to be there getting the lowest price of the day dang it no. You don't need to right. You're, gonna try a something, that meets your rules and, you have verification, of your roles but. Don't feel like you've got to be down here at the lowest point of this hammer on this day.

When. We were getting this hammer. Okay. So. Let's. Go over here to the trade tab. You. Know how many days do people like to sell it varies, okay, some. People will go out further in time and, way, out of the money to have a real high probability. Trade. Some. People will like to get. Something in arranged that gives them a decent amount of. Credit. But, that theta decay, will kick in fairly quickly rather. Than waiting for it to kick in in two months so. Somebody, could look at 17 days that might be a little short for some people. We. Could look at these May 31 and. What I'm going to have you look at is the open interest column. And. It. Is right here. Let's. Get the right thing here. See. This open interest on the puts ask. Yourself, is that a lot or is that not. An. Answer yourself, if, anybody comes in the room it's okay that you're talking to yourself okay. Is, it is it pretty good or not it's. Kind of I'm gonna say on the, anemic side especially, if you're somebody likes to trade a lot of contracts, no cares not a lot there. Let's. Go out to the monthly options, then June 21. Are. We seen some good open interest there, well, let's see, there's, our open interest column we look down at we see hundreds, we see thousands. So. That looks a little bit more like it right you don't feel like you're at the circus. All by yourself. Who. Wants to go to the circus by themselves. All. Right so. Strike. Prices some, people will use that Delta, to, determine. What. Strike price they want to choose to sell. We've. Got a 40 we've got a 30 we've got a 21, we've got a 14. And. Then so you'll decide as you're practicing these types of trades where you like what, range you might like the best for, a purposes, today we're gonna go at this 30 Delta that. Essentially. Says hey you've got about a 30%. Probability. Of expiring. Out-of-the-money. Which. Is what you want on a short put vertical trade, right so. Let's do this I'm gonna do a right mouse-click and I'm gonna say sell vertical. It's. Smart it knows to go get the next number in sequence in, terms of the strike prices so it'll be 300. 290, selling. The 300. It's. Gonna come up with a credit of about 250. All. Right so, on. The. Short vertical. If. We do 300. And 290. Our max. Gain on that is gonna be, 250. Right. For one set of contracts. $250. That means our max loss is going to be what I want. You to tell yourself again. If somebody comes in the room don't worry about it, okay. The, max loss here, is going, to be 1, minus. 250. Or. Or. 10 I should say 10 because that's the difference in the strike prices -. 250, gives us 750. So. We want a position, size of. 750. Dollars. Well. If we're only willing to risk in any trade 1,500 dollars and. Our. Risk on one contract, is 750. Those. Of you that can do some quick math say well if you do 2 contracts. Whoa. That's, just really, tight so we look at that if you go, 1,500. These. Numbers actually work out kind of nice for us divided. By 7.5. Say. It's. The equivalent of 200 shares which means you chopped off those zeroes and it's, 2 contracts, that's. The maximum, number, that you. Should do that theoretically. Come options expiration, day, if. Things don't work. Out in the trade like you wanted that you're collecting this premium you're not keeping it all and you have a full, max loss. You. Don't want to do that with more than 2 contracts, so you can steep with keep, within. Your, balance, of $1,500, that you're willing to risk it straight, let. Me accesed you guys. So. We've got our two contracts, here I'm not, going to put in a loss or a target, on this at this point but. I am going to go ahead and, let's, see it looks like it did it at the midpoint versus. The natural so. We can see a paper money will be nice to us today and fill. That. All. Right let's do. One more trade. What. If you're not a short put vertical person.

And. We need to watch that you. Guys don't let me forget about that. We. Put it in at 250. And. Usually. I see a column, over here that tells me what the going rate is if. We don't get filled on this in a couple minutes I'll come back and look at it. Somebody. Might not be a short put vertical person, what if you're a long call vertical person. Similar. Types, strategy. But you, know in the short put vertical we're looking for the price of the stock to stay above 300. Where. Is it right now well. 300 is about down here, this, has, about 17. Almost 18 dollars. Worth of wiggle room before, it gets down here to that short strike price. Now. Many times on a long vertical. The. Stock, needs. To move for, you in. A short vertical scenario, that we did and it doesn't always work out that way but the one that we chose. It. Just needs to stay above that 300. Strike. Now. On a long vertical many, times people will start at the money so. We've got 317. Almost 318. So. Actually. Your 320. Is your closest, at the bunny strike price I'm. Gonna start here, though I'm going to start at 310, this. Is going to be a little bit more conservative let's, look at it so if we say by a vertical. It's. Gonna cost us, 570. What's. The max gain on it max. Gain on it is difference, between the two strike prices $10. -. The net debit there. Oh get. It just got a nickel cheaper for us, alright, so, net. A, strike. Price difference, 10 - net dabit tells us what our max potential loss could be, okay. So. On it I'm just gonna call, this LCD. And. We're doing 310. 320. Again. You might choose different strike prices these. Don't have to be your strike prices that you go with and, I'm just going to come here and lock the lock so it quits, fluttering. Around on us so. 10 minus 570. Tells us our max potential loss on this trade / contract, is going to be about 430. Let's. Do the same thing with our calculator, let's. Take our $1500. Divide. That, by. Our, max, potential loss of 430. That. Support, letters, with the numbers in the right order okay. 348. Each. Contract, controls 100 shares so you'll wipe off everything you just stick with that first number 3. In this. Scenario we, could put, in our account 3, long. Put verticals. Tygris. There. Is no, advertising. On our YouTube, channel, okay. And. Yeah. This will be held for, review so. Remember, you guys in our in, our webcast. We don't allow people to, advertise. For their own purposes, okay. So. Don't, do that alright. Confirm and stand off it goes we're. Gonna send that one in with. The idea now it did put it kind of at that midpoint price, so it might not, be. Getting filled so quick ah. There. Goes our long. Vertical we've got three contracts. Let's. Come over here let's. See, working. Orders let's make sure so. We've got our short put vertical still, working. No. That's our shares, and the stop-loss okay we must have got filled on it. Must. Have got filled on our contracts, okay, now. One other thing I want to follow up with you on and this is kind of the trade management, piece I'm gonna skip back to it wasn't. Sure how much time we might have a couple. Of weeks ago we put in a trade actually. It's tearin or working orders and, it. Never felt, so we put in on April 16th, to. Buy thirty-five, shares of Illumina if. The. Price of the stock were, to go to three, thirty seven forty and, we the order type was what we call it a buy.

Stop Which, means don't buy it unless it gets to this particular point. Alright, so. Let's. Go look at Illumina, because, none of them. Have. Triggered. Yet. So. Here's Illumina, this. Is kind of when we were looking at it we were seeing this nice little flag pull up straight vertical move pop-pop-pop. We. Were seeing it start to consolidate. And so. We put in at that buy stop order that says only if you get out of the flag. Consolidation. Area. Only. Then are we interested in getting filled. Well. It's been two weeks and what's happened, the. Stop has the stock, has dropped back. They it looks like they have earnings a couple days ago, didn't. Die. I guess, the market didn't like too much what they have to say cuz they're continuing. To slow it down here a bit. So. At this point, is there any reason, I want you to answer yourself again, is there any reason to keep that trade, out in our working orders is. There any reason to. It. Doesn't meet the criteria anymore. At all, okay. So, we're gonna zap it I'm. Gonna come over here with the buy stop this is the green one I'm. Gonna click on it and hit the X and it's going to cancel all three of those because, attached. To it was, an OC order, Oh Co order, for a target. And. For. A stop, okay. So, we'll get rid of both of those. Now. One other trade man this guy. We've. Had. To look out every week because, it keeps going and going, we. Could call it the Duracell. Battery. Trade. Right. I like, the Duracell, battery bunny. Entered. Into this trade with some stock hunter, shares on this. Day that has the little, green oval. Okay. It's, never come down and hit her stop-loss and we've moved it up up up. Okay. Now I want you to ask yourself, if you heard if this were your trade and you were up on the trade let's. Go look here. On. Our visa. And. We're. Up about $3,000. On it which is nice it, was more of a trend trade was, not a swing trade which we have been focusing, on okay. The. Average, price on. This. Long Collett and then we did it with the month of September. Okay. I was. Thinking it was a hundred shares of stock that it's not-it's a long call out, in September, so our plan was to trend, trade it is, it doing what we wanted yeah it's doing what we wanted, we. Come back here to the trake town. Come. Over here to visa pull, up our position, yes. Now an 88. Delta. Okay. An 88. Delta. Now. One thing you can do when a trade gets to this point is you can kind of lock in your profits, and open. Up a new contract, you're starting to little lose a little bit of your leverage. When. The Delta is starts creeping up into the high 80s, and the low 90s. Now. For. Our purposes today and I'm actually going to leave it next, week we'll roll it I'm we're, gonna assume that next week it's gonna continue to be going up and it'll. Be in a position that, you'll, say hey it's 90 or above and, let's. Go ahead and all it note would there be anything wrong with rolling it right here not. Really, there's. Nothing wrong really, with that I mean, if we're trying to sell it the option, contract now is worth 26:45, and I. Believe when we entered the trade it was. We. Just looked at the number. Thirteen. Eighty. Okay. So it's almost completely. Double, not quite but it's up about a hundred percent. On. That particular trade, but. You would be concerned. About hey this is traded nicely for me let's. Work on profit, patek. Ssin that's why I say we're, gonna take a look at that next week and if it's something in the 90s deltas we're, gonna roll it don't, talk to you about rolling it. All. Right now. You. Guys what, what I want you to do to follow up today I, hope. That as we went through those three examples on, Broadcom that. You were able to follow how we did the position sizing on, the stock on the short put vertical and on, the long haul vertical.

Okay, The. Same thing, we did we worked with basically, as how much risk is on the trade and, then. Just using that formula, depending. On if it was stock or a vertical, just. Seeing what your what, your max loss was against, how much you were willing to risk, yes. / Louvre, okay. And. Remember that that $1,500, isn't how much you're willing to put into the investment, with $150,000. Account it's, how much you're willing to lose if things. Go wrong in the trade you, don't want to lose more than 1% of your account now. Let's. Get this up here. If. You are somebody that is taking, advantage of the webcast, which I hope is every, single one of you. Go. Over to education, click. On the webcast menu, and this little box will pop up if. You want to go back to some of the things we talked about last week come over here to the archived webcast you. Can see the archived webcasts, whether they're from me, whether. They're from somebody age somebody. Else I should say one, that might be helpful to you, is. A verticals. Webcast. That John McNichol, does, and so I'm actually gonna select your intermediate, I'm, gonna pick John's name. He. Does a fun, one on reversal, and bounce patterns, and then he has this one here trading vertical, spreads if if, you were feeling a little bit like I don't know not really into verticals yet, again. Go to barb Armstrong's, class and then. Trading these vertical, spreads as well it could be a good place for you to go check, out the in-person events there's. One coming up in. Strategies. For growth. That. Is going to be in. Birmingham. Michigan I'm. Going to be at that one and I would love to meet any of you that are. Close by I am going to attend, that. So. I've given you an assignment we've, talked about trade, techniques. How. To a position size and address. Your risk and of course we use the thinkorswim platform a, little bit so. That's. What I want you to work on on your own is those. Wrapping, up those trade techniques, keeping, the profit and then, position, sizing when you get in now. I just have to remind you that. In. Order to demonstrate functionality. The platform, we need to use. Actual, ticker symbols the TD Ameritrade doesn't give commendations and so anything. Investment. Decision you're making yourself directed account is your responsibility. Next. Week we're, gonna try to do a whole process, from. Swing trade beginning just wouldn't trade down even, though we focused on little parts of it through the last little bit now, coming up next is going to be Cameron, Mae with the question answer, session he'd. Love to have you there I know it's a very popular session. Get, there early so you can check your questions, in alright have a good day for everyone we'll see you next week bye bye. You.

2019-05-04 21:13

Show Video

Other news