jim2000

I think you're correct that a trader needs an edge. The edge imo needs to be the trader doing what needs to be done. The smaller size is good too for rough patches and newbies. Oh, and don't be greedy.

Why do traders fail? Why did I fail? It's really very simple, in the attached chart you see thousands of times on thousands of charts, look on any chart and find this pattern. It pertains to any market that goes up and down. In any time frame. When price is doing this, i.e. going up, be long. Have a position. When price stops doing that, get out. You have to determine where to get in, (context), when to get out, (when price reverses momentum), and whether or not to get back in, rinse and repeat. This is not hard to figure out just by looking at any chart, even though it took me years to realize. All anyone has to do is just look at this chart and emulate it with your own trade. If the chart does not look like this then don't be there and find one that does. It took me many years and many dollars to figure this out. And yes PATIENCE is a virtue. And yes don't treat trading like a slot machine or the next trifecta. Be CALM and don't pull the trigger until you're at ease and confident. Being calm and picking your spot will breed confidence. Trust me.

If you are short on ex date at the close you pay the div. If you cover before the close you do not pay div.

Thanks for the words of wisdom. It's funny how once one becomes more experienced as a trader one can read a post such as this and really understand it and say hey, now I get it! Now I understand! Almost every single word is important. It only took hundreds of trades of not setting stops, and hundreds of times realizing what could have been. I am lucky to still have an account. You truly do a great service to the trading community. Thank You.

This is just a thought and you are probably already aware of it, but it really does work...If you can let the winners run by continually managing and adjusting your stop, you won't care if you get stopped out 5 times for 10 ticks each if you get that 1 trade that goes 100 or more ticks.

I think alot of it depends on what you are comfortable with. I don't think 10 ticks is too much to risk but personally I'm not that precise on my entries yet, so I need more wiggle room for the trade to work. I have seen others post that their stops are a couple ticks but maybe they are getting good precise entries. I might suggest trying different amounts to see what works best with your setups. You know it doesn't do any good to get stopped out on every trade. I actually use 2 different entries and a different stop for each one. One is more precise with a tighter stop and the other is less precise with a somewhat wider stop.

Walter, Very good and informative videos and information. Thank you. My platform, ToS, also does not have tick charts at this time. They are working on that. My minimum timeframe is 1 minute. You indicate that the 1 minute chart can be traded but it is just different. My question is, can I use the CCI with the same settings that you use or do I need to change the settings to trade the 1 minute chart?

I will begin trading the YM soon and thought I read somewhere that the pattern daytrader rule does not apply to futures. Is this correct?

I think I prefer to sell rather than buy. I feel more comfortable. I can't seem to pick the direction a stock is going so by selling, the stock can move up or down and I don't care. I make money either way. I am no good at picking the direction a stock will move.

Sold SVNT Dec 15 calls @ 2.55.

Thanks Momentom, I appreciate your reply, and I will heed your words. I'll look up Comex Gold and study that situation. I'm assuming these smart rich guys got cocky, greedy, and over leveraged. Thanks again. I appreciate your perspective.

Yeah, but it is almost a no lose trade. That is if you watch it carefully. Also, on paper it's a huge margin risk, but in reality there is no risk, zero risk, because you will cover the call at, or just before the strike if needed, even just above strike is ok. If after buying the stock it starts to drop, just sell it at market above the breakeven point. You enter the trade receiving, not spending, cash. It doesn't matter if the underlying goes up or down. Even if it goes above the strike before you can act you have a cushion to work with, the premium you received. Sell a call near the expiration to avoid the need to watch it closely for 5 or 6 weeks. You don't need to study charts to pick a good company, just look at the options chains for different stocks until you find an option with a high enough premium to make it worth the while. Probably at least $1 All you really need to do is be prepared to buy the stock, no problem If it does go above the strike if the option is excercised that's ok because chances are you will still be within your profit zone, if not and you take a small loss, that will happen from time to time, but not often Like I said before, a gap up before you buy the stock, or a gap down after buying the stock are the 2 risks to this trade. Oh, this is all my opinion, not a recommendation.

I understand the risk that the stock could skyrocket up, you get assigned and have to buy the stock at e.g. 70 to sell it at 55, a loss of 1500 per contract. But who would be stupid enough to do that? What do you think of this scenario? When you sell a naked call you don't care which direction underlying goes. It goes down, that is great. It goes up, you buy the stock just below the strike price to cover. If price stays below strike at expiration, great. Then either sell stock or write covered call. At this point there are many strategies to employ. Am I missing something? Who would be foolish enough to not cover if the underlying was approaching the strike? Any thoughts on this?

Has anyone here ever written naked calls. If so how did that work out?

Are credit spreads a good way to trade options?

Thanks TinGull I will definitely do this.

The website says $0.015/share ($5 minimum) or flat fee of $9.95. For options the rate is $2.95/contract or $1.50/contract + $9.95 whichever is less. They also indicate you can choose any broker internet rate. This seems more expensive then what I'm paying now at Scottrade. TradeKing is $4.95 + $0.65/contract. I guess ToS, at my request, would need to discount their rates to be less. I'm not sure what IB charges but I thought it was like $1/contract with no added commission.

I downloaded the TOS trading platform and like it. Have you TinGull or anyone traded futures on TOS? I see from their website that futures trading is available.

Haha. I will look into ThinkorSwim. Thanks. In addition to the high fees, they also restrict trading to buy puts and calls, and sell covered calls.

Scottrade.

Per side I pay 7.00 + 1.25 per contract.

I did unload these today for 100%. However, with commission and fees I didn't net much cash. Bought at .04 sold at .08. I might try TradeKing for their low rates.

Thanks TinGull for the critique. That's why I posted these trades to get some feedback. Also, personally, I would like to see yours and others trades to learn what others are doing and how. Thanks again.

Bought VRSN NOV 30 call @ $4.80 for a quick swing play. Bought ANR DEC 22.5 call @ $5.40.

Delta tells you how much the price of the option will move in relation to the underlying security. e.g. if delta is .98, and the stock moves up $1.00, then the option should move up Approx. $0.98. If using options to buy stock cheaper with more leverage, stick with high delta strikes. i.e. above .90 Also, in general stick with in-the-money options. The out-of-the-money options are cheaper but they typically have lower deltas and less chance to appreciate. As an example, for fun and pure speculation I bought some OTM MSFT NOV 40calls for cheap. MSFT went up today $1/share however my calls stayed the same, went nowhere. Now if microsoft were to rally big in the next couple weeks, that would be great, but it was a cheap gamble.