Bear and Bull Swing Setup Examples | Swing Trading (Days to Weeks)
Good day, everyone John McNichol here. Welcome to swing trading days. Two weeks over. Everyone enjoyed the memorial weekend there. We're going to talk about today is after we look at current market conditions will review several swing set ups, both from a bullish as well as a bearish category and we'll go ahead and attempt to do some practice trades. Whether it's a stock individual option, as well as the spread trade, so stick around.
It's great to see those of that are live with us today. Welcome back. We got VJ Lamar Robert Um, Michael. And looking down the list. Fred's online there along with everyone else that's joining us today. Thank you so
much for being here. We have Mr James Boyd helping out on the chat. So any questions That I am unable to get to he'll be more than happy to help do appreciate him being here. You can follow him along with myself on Twitter . It's our first initial last name. Underscore T V eight. And it's kind of a repository for some of the things that we teach here at Tdameritrade education. Great way to learn more about your instructors as well. Let's
go and take care of disclosures will get right into it. Contents intended for educational purposes, only non investment advice or recommendation of any security strategy account type options not suitable for all investors. Spread's straddles the multileg options strategies often involve greater more complex risk than single leg option trades. Along with substantial transaction costs should be considered when evaluating any trade. You're
encouraged practice what you learned here today with tools such as to paperMoney software, which is for educational purposes and successful virtual trading during one time period does not guarantee success of actual funds. There are later time period as Mark Ignitions change continuously. Make note. As far as with options, long call or put option position, place the entire cost of the option position at risk. Likewise short options can be assigned at any time, regardless of the in the money amount. Ah likewise. Wireless Webcast may discuss technical analysis other approaches, including fundamental analysis may assert very different views. And in
order to demonstrate the functionality the platform we will be using actual symbols. Albert Tdameritrade does not make recommendations or terms suitability of any security or strategy for individual traders. Any investment decision you make yourself directed account is solely your responsibility. There's my bio for those that are interested. If you are new
this webcast, let us know we'd like to give you a hearty welcome. This class is a little more. On the intermediate. Some cases, a little more advanced.
It is focusing on short term trading kind of days, two weeks. Mr James Boyd does have a great companion workshop or correction . Ah Big Companion. Ah Webcast on trading the trend Remind me on when that is James. I believe it is tomorrow, but I know sometimes our schedule may have changed a little bit. That we can probably just go ahead and take a look on the education tab via the Tdameritrade website or on to think or swim platform. And go ahead and go to the Web cast their once there. You can
see our upcoming live content as you're on swing trading here right now. You can see the rest of schedule for today. If you want to see upcoming or other days sometimes you can scroll down a little bit more. But if
you want to see our schedule just go to the Webcast calendar. And as you scroll down. Ah you will see with James. It's actually on Thursday. Trading
the trend. I'll actually be on technically speaking tomorrow would break out and reversals as there are some patterns that are continuing to form. But James's class for trading the trend. Great Companion to this class would be at two PM Eastern time. Alright, let's go ahead and bring up the Agenda for today. And as we go ahead and bring that up. Let's go ahead and take
a look at some of the current market conditions as we did see a bounce from last week. Is that going to continue? Are we seeing a little bit of a slowdown there, possibly some resistance forming We'll go in review some possible swing setups will attempt to do both bullish as well as bearish there, and we'll see how many examples we can get in today. Whether it's a stock option, as well as a spread trade, so various ways we can trade to swing there's certainly pros and cons for whatever instrument you trade in the case of stocks. Ah For the most part
, many stocks are relatively liquid as far as the ease of getting in and out don't have time to K. However, con It is locking up a relatively large amount of capital. If one's just looking to profit from a relatively shorter term move. Options do give some of those pros such as less capital more of a defined risk. However you
know there are other risks. Such as which short options risk of assignment in the case of long options again, the entire premium can be put at risk and options do not last forever. So again, do what you're comfortable with and encourage it to continue practicing. Ah various instruments on to think or swim platform part of me utilizing the paperMoney platform. Let's go ahead and
bring up the thinker swim platform. Looking at some of the major market indices here. Looking at the S and P. The S and P did break a diagonal trend. We've been discussing this theme. For several weeks
now has potential for some support, and possibly at least a base starting to form. Uh, arguments been leaning a little more that way as we've seen a break of the nearer term downward trend. We've taken a short term high out. And then
notice that we maybe finding some resistance. Ah at the previous support areas, you can see kind of more of this congestion consolidation towards the end of April. Rallying up to that area there. Ah with the market about an hour left. We are potentially seeing and inside day. Or potentially a
bearish Karami with an inside day occurring at resistance knows to 55 Day moving average. Ah still falling, representing more of that trend? Bulls as far as bullish reversal would probably would like to see price action to not only make that higher high but to break out and get back at least into that previous range, But we're seeing Some of that momentum, potentially slowing down. So we go ahead and look at the NASDAQ. $NDX. Similar situation. Now we have talked about the NASDAQ being relatively weaker. From the standpoint of a combination of relative strength, falling and then also kind of more of that descending triangle. More
of that horizontal resistance. Correction Horizontal support falling resistance. Now traders need to be conscious of that preferential bias, even though a descending triangle if the trend continues, would be considered be a continuation pattern. We know that any pattern can also be potentially a reversal. As we did see a break of that downward trend. Ah some of the NASDAQ
stocks with the NASDAQ, at least ticking up from relative strength. Demonstrating possibly some buyers stepping in. Ah finding some undervalued quote, undervalued as far as technically stocks, however, stocks can remain undervalued for an extended period of time. Ah! Taken out that high barely there. But again, you can see some of that overhead resistance and at least a slowdown, uh, at where the price had been previous support kind of a key principle. I know James Teaches
this extensively as well. The principal and how broken support Ah can act as new resistance. Now it doesn't necessarily mean that prices going to roll over and retest lows, but at the very least, notice we're seeing more of a rectangle. Forman in the case of the NASDAQ prices continue to break higher.
Possibly signs of that bullish reversal. And continuation would obviously be rolling over and breaking below that support. Looking at the Russell as far as a small caps so you can see it continued theme here again. We've seen breakouts from the previous week being supported by some of those positive divergences as that downward momentum slowed down. Finding support. Break in some of the
downward trends that we've seen. However slowing down at that last breakdown that we had at the beginning of May there so with the Uh, last trading day of the month. Uh you know markets at least attempting to recover. Much of the loss from May, however, not necessarily recovering it entirely, at least at this point. Okay? Quick
glance at volatility V I X. And possibly a little consolation for the Bulls. Uh price breaking to the upside volatility breaking a little bit. To the downside. However we can kind of see some of those characteristics on volatility as well. Ah, volatility. Possibly
being in the lower more recent range. The bullish case as far as volatility is to see that volatility continued drifting lower, however, still risks in the market as we can see going back to early April. We still see kind of more of those higher lows in this case more recently , equal lows as far as we're volatility has been moving there. Alright, let's go ahead and talk about some of the setups and you know some of these. Ah, examples that we're looking at. All came from one of the public watch lists. The
weekly Watch list, which usually points towards stocks, and maybe more widely traded. That are optional and may have a wider selection of both expirations as well as strike prices there. So you're encouraged to take a look at some of those public lists if you are more of an active trader again, use using license some of your own due diligence there.
And if we go ahead and bring up on the think of some platform You can see again over here on the lower left. I'm looking at again an example list public list for the weeklies. And as I was going through Some of the themes to consider. And this is kind of a little more on the kind of the top down. Ah, approach here. Just going clean this up a little bit here for a sec. As we look at some of the
sectors that have been performing today. Ah you know, we've seen some lifts in consumer communication services. Or consumer? Discretionary A should say thank you communicate and communication services, given a little help to the NASDAQ, Their financials were a little positive earlier as well as information technology being noticed, we can see A lot of these have degraded here in the latter part of the afternoon. Uh
um include materials being Hit pretty harder after having a pretty good run up over the last week. So some kind of other mixed signals. You know, we've seen China. A lot of Chinese. A DRS Take a bit of a bump Ah today, which may lean more towards the bullish case, however kind of inverse. We've seen commodities back off a little bit. Today however, there's still concerns as far as with supply chain Ukraine, Russia as well as obviously rising fuel prices. Impact in
that Goldman Sachs putting out AH, commodities as far as being the more attractive trade in the market again. That's a third party there, but just showing some of the consensus that Maybe out there. Likewise we also addressed on potentially finding some resistance there. But even as we look at material stocks Knows the relative strength had been rising over the last two months compared to the rest of the market have backed off a little bit today. But, you know
is that just a little bit of a blowback After a previous break out there. Uh other areas. Uh let's see Ah, on the staples. We've seen a lot of staples after selling off over the last month, kind of making a bit of a run up, but similar to the broader market, you know. Is
this going to be an example of the continued reversal? Are we seeing some resistance, setting up as far as the bear case, Some bears may be looking for bearers setups looking for those prices to roll over. So just a couple examples there and kind of tied in to some of the examples that will go ahead and look at here today. Ah in in no particular order. Ah Since we were looking at Staples, let's go and take a look at Clorox. C L X. That's actually spell that right? There we go. So as you go in and look
at Clorox similar to what we're looking at on the sector. You can see how price sold off pretty strongly here. And then kind of retrace back up. A
couple of points to consider is notice that previous price actions such as these highs Ah, also the midpoint of a long range candle. Can act as areas of resistance. And as we kind of zoom in a little bit closer, we see an example of potentially a couple load. Ah, potential
close. Below the low of a high day I e. An example of a resistance bounce. Ah notice as far as with some of the moving averages. 55 day moving average,
although flattening out Ah, potentially acting as a bit of resistance there. So let's say for this example one maybe Over the shorter term bearish, maybe whether expecting that resistance to hold and or looking for the price to basically drift down trade lower over. Days Two weeks there can we do more of a defined risk trade? Take advantage of that, and one example that would be a spread trade. So let's do that
example first by doing what's referred to as a long put vertical Ah, this gives us the opportunity to Ah, the bearish And also be possibly a little directional. I'm gonna go ahead and go to the trade tab. And we got Clorox on the screen. As far as timeframe. I think when I was looking at this previously was looking out to July. One July would put us into some of the weekly options. That's 31 days.
And one of the considerations when looking at options is looking at liquidity. The difference between the bid and the ask price. Ah we have commonly taught. We'd like to see that spread to be no more than 10% of the ask price, So we kind of look at some of these at the money's with a $5 Ask Price . 50 cents would be 10% notice. That's a 30% spread. Or 30. Cents spread so smaller, the better, but that may point towards some of that liquidity. Traders may also look at things Such as volume and open interest. Um However, it is not
uncommon. Ah as you get into some of the weekly options as far as ah, The amount of options traded on that day may not be necessarily high. As there are quite a few Ah expirations to select from. If we go ahead and
take a look at that. The Greeks again. One of the starting points was looking at. An option . Kind of think as an example along the lines of a stock replacement in this case from a bearish perspective on going a little more in the money. And buying one option and then selling a another option where we believe that the price maybe trading down to think when I was looking at this was looking at somewhere close to around the 60 Delta. That was around the 1 48
strike. We'd be paying about $6.20 for that option. Now there's a multiplier, which is 100. So if I had to confirm and send on this This option would cost $620 per contract. Now that
would be a defined risk What we pay for that option is what is at risk. Now we can also since we're looking at it more on the near term, Likewise, as far as having a particular price target in mind, we can reduce the net cost of this trade. And also, AH , limit some of the impacts which are negative to the options such as time decay, at least reducing the impact of that time. Decay in some cases, actually make it a little positive. So what I'm gonna do here since we already have that long option. I'm going to go
ahead and take a look at an option to sell. And here looking at the 1 43. So what's the thought? As far as with 1 43 Well knows 1 43 is not necessarily much lower. Then where the price is right now. If one was more directional, they may go ahead and go with a lower strike. However that spread would cost more because the further out of the money You would select as far as the strike. That's less of a
premium. You'd get back. And you know, we may be also looking to improve the probabilities of a profitable trade by just looking at more of a slightly bearish moved down. So if I go ahead and take a look at those options again the trade tab And constructive spread since Ari had clicked on the aspirants for the 1 48, I'm gonna hold onto control Key. And I'm going to click cell. On that 1 43. Notice the net cost of the trade. Was reduced here. Ah it's down to 2
30, although the market prices closer to 60, so that would be about 232 $260. So we have an example of a defined risk plus transaction fees. We also have a defined game, and that's one of the trade offs. As far as with the spread, you do have a defined risk, but there's also defying gain. However if our
expectation is the price to trade down Around the 1 43 Mark. Ah this would potentially have a maximum gain about $270. If it's at or below 1 43 at that July expiration. Now, if it happens before then we may be able to capture a significant amount of this game. We've typically been
targeting anywhere from 30 to 50% of this maximum game. In that case, it would be anywhere from what Let's say about e 90. 92 about 100. What about 65? Nope Um $180 there. As a range about 30 to 50% of that maximum game. Now the other benefit here is with that defined loss. I can
position size this to a maximum loss. Let's say in this example I wanted to risk. Uh Let's see $1000 in the treat. We can take
that 230 divided into 1000 that should enable us to do this four times. So I'll change that to four. Go to confirm and send. So there's 9 40. There's our potential maximum profit and from a matter of profit management if we have a quick burst to the downside, we may lock in again of about 30% of that maximum game as an example $300 Ah, if we're going to give it a little more time, we may look to manage that if we have realized about 50% of that, in this case about $500 with this example I'm gonna go ahead and send this one out. See if we can
go ahead and get that filled now since I was talking through that it may make sense to one. Make sure it's unlocked, so we look at some of the current prices. That's the mid price. The market price is closer to 2 70. If we
put it through at the mid price it may or may not get filled. Right away. A lot of that would depend on liquidity. Now. This
is a simulated account here. If I did want to try and get that filled A bit sooner. We could go back to that monitor tab. Go to the work in orders. I can go ahead and right click. Cancel and replace the order. And then
put in a price that may be a little more marketable. However, keep in mind, the more we pay for the spread the less of a game because most they could be made or lost on this spread. Would be $5. Times the multiplier times the number of contracts So I'm gonna go ahead and put this through. So we at
least have an example going through. There's our adjustment now. Another nick, keep in mind is look at the break even 1 45 60. We're actually just at we're pretty close to that. So
assuming the stock doesn't do anything Ah, this can be a slightly profitable trade minus any transaction fees, so this is kind of a little more slightly bearish type trait. I'm going to go and send that through. And notice. We do have a practice straight filled on that will continue managing that. They're with me for a second here. As we
go ahead, go ahead and move this to our swing trade examples here. Alright, There we go. Go back on the chart here. And let's go ahead. Double check.
See if anyone has any questions. As well. Go ahead and continue doing some other examples here. Mhm and looks like James has thing well under control. Thanks, James for helping out there. Okay, So we did an example. On a possible swing set
up in this case to the downside. With. Or example on Clorox. Let's go and look at some other examples. We'll see if we can
get an example of both a stock as well as an option trade in. And just in summary as far as with Clorox, now a full successful swing trade, maybe the price actually trading down. To that previous low in this case around 1 32. We went ahead and did our example. As we go back. On the monitor tab. We're just targeting around 1 43. So
if one was more directional again, they may select the lower strike. Ah in this environment as we've seen volatility and prices dramatically go up as well as down. This is kind of one of the attractions as far as with spread trades based off of that defined risk. And may require a little bit of patients such as time to have that favorable move. So we'll see how that one plays out. Newbie says
How important is the delta on the long and the short put It's a good question if I go ahead and let's say I'll go to the analyzed tab. On to think or swim platform and go to the risk profile. To make sure we have Clorox in their this will actually show any positions that you have. And those of you that are familiar with the long vertical. As well as even a
short vertical Is the principle of that Z shape Ah, which is a define risk. In this case to the upside as you can see higher prices and the defined gain which in this case is to the upside. Maximum gain realized if we're at 1 43 add expiration. However we can be significantly profitable if the stock drops. Ah, over the next few days or the next week or two. The other traction with this strategy is If I come over here to the right of this little plus sign We can actually set the break even as I talked about on the confirm incent If I go to the break even And go to that break, even as of July 2nd. Ah This is where some
of the selection Of the Strike prices. Kind of come into mind by going more at To in the money. We do improve our probabilities a little bit. Ah notice in this case about a 53% probability of being at that break even or higher based off the current market conditions. If I went a little further at to add to the money. Ah those
probabilities would be a bit lower. It would require a stronger move more directional. Ah, so by being a little more in the money in the money to add to slightly out of the money. Ah that does improve a bit of the probabilities of a profitable trade, although that's probable Not certainty. Uh, also If I go ahead and reset The slices here. With long options were one has what's referred to as negative time decay. Being a little more
in the money on the long option and being a little closer to at the money on the short option, you may find yourself actually with APPOSITIVE theta. This is why our break even is actually slightly above the current price so more of the neutral, although still primarily Ah, slightly bearish strategy, Okay, And you know, as a poor man, a poor person's or a quick way of looking at it is keeping in mind that With us selecting that 1 43 strike that 41 Delta implies that we got a 41. Probability of it being to that maximum gain being at or below that 1 43 strike basically the probability of that being in the money. Now there are some risks as far as with the trade, and we'll move on to. Our next example is
remember. You do have a long option. In this case, the 1 48 if we don't realize our profit gains. As an example whether
it's at 30 to 50% We do need to manage that trade as we go into expiration. Ah let's say in that last week, which is relatively common for spread trades as the possibly close it out. Ah maybe it's at a marginal gain. Maybe it's at a marginal loss. But the
idea being if the long option goes in expiration, and it's in the money There's a likelihood that that option would be automatically exercise, meaning you would be put the stock in our example. Being put to stock at 1 48, which may not be your intention, so to remove Ah, that potential auto exercise is to close out the position. Before expiration in that last week. So if you found that helpful if you do find interest in this strategy, maybe it's the first time you came across that. Would encourage you to join me on Thursdays, where I teach long verticals and diagonals every Thursday that is live at, um, believe it's 11 A.m. eastern
time. And those are also recorded so you can also go in the archive. Look for John McNichol and see some of those Webcasts there as I showed you earlier. Don't the education tab. Via Webcasts. Once there you can actually go to the archived Webcasts. And if you
want to see anything that I've done, just go to the instructor. Look for John McNichol. And you can see some of my discussions on long verticals and diagonals . If you go back and look at some of the examples such as did actually a bullish vertical low over a week ago. And likewise for this class on swing trading . You can also see some of my previous sessions as well. So it encourage you to do that. And a
lot of times you'll see that in the description At the bottom of the Webcast as well. Alright, so Let's go ahead and see if we can do an example on a stock trade. And have a few examples for that Now. The previous example we did was bearish. Ah let's look at an
example of from a bullish perspective. One and this is a relatively less expensive stock . However, it doesn't remove. Uh uh, the possibility for risk their think it was mankind. M. N. K. D if I did that, right? Nope. M and K D. This is a pattern that we talked about in the breakout and reversal patterns. Again This is an
example that came off of that weekly list. We can see some resistance. That price broke out . We can see price pulling back. To that potential support.
Broken resistance have a tendency of acting as new support. We see an example of a W pattern or with some traders may refer to as a double bottom. Again taught in our technical analysis course I know James talks about these reversal patterns as well as myself tomorrow in technically speaking breakdown reversals. If I go ahead and pull this out a little bit more. So I can get rid of this drawing tool here. All
right. So you can see an example of a stock that is potentially forming more of a bullish reversal getting above. Some of the moving averages that had been acting as resistance on some other stocks. Some traders may look at the distance of that pattern in this case from around 2 60 upwards to around about $4. That would be better Be about a buck 50 bucks. 60. There are
about. So if the price was to be projected up about another buck 60 that maybe trading somewhere based off of 4 10 somewhere around 5 70. We go ahead and we take a look at that. Ah that
would actually be taken out more of a recent or actually high from last year. Now whether it does that Some shorter term traders may be keeping an eye on some of these previous lows like that $5 area, some traders maybe looking as kind of more of a psychological area of support and resistance. It's only do with this example. Is doing example of what we would call a potential CAHOLD-. What if price was to trade or close above the high the low day and look to enter as price trades above that area. Now, in that case, we got $4.44. Which is the high of the
potential low day. So if we're looking to put in order as the price trades above that resistance We can do an example of a buy stop. And what I'm going to do is do an example. If the price let's say goes 10 cents above that high. That would be $4.54. I'm just going
to simply right click. Ah, near that price. And I'll do a buy custom. With stop. Where I'm going to tweak the stop there.
But starting off with the buy order knows it says a limit day order. What we do is I'm actually gonna change this to a stop limit GTC. So put in order That will not only be in effect for today, going into the close but will be in effect for tomorrow and any succeeding days. Now the stop is going to
be the trigger price. I think I said that we would make that, uh $4 and 50 Four cents. Now some traders may put a little bit of a slippage after that, if we trigger at 4 54 May go ahead and set Uh, maybe about 10 or 20 cents above that, so go ahead. I'll make that 64 cents. Now if
I go ahead and we take a look At this potential move. Certainly with cheaper stocks have intensity being more volatile. You know, that's about a 5 to 10% range. Even for today, some
traders may just buy off of that dip, anticipating that that price may bounce. And we may evaluate this tomorrow to see if that price is still pulling back. As far as a targeted price. But I want to go a little bit further out. On this. You
know, there's about the $5 level above there would be closer around 5 53. Now you can take a little more time for the price to do that, outside of Ah, the days and in some cases, even a little more weeks. This pattern was formed over the last two months but did want to show an example. Of a buy. Stop with the price is pulling back. And since this is a less expensive stock, I'm gonna position size this a little more kind of like an option is that whatever amount that's being purchased Is at risk. So let's say as an example again want to risk about $1000 with this trade? I can divide basically that for 44 into $1000 . I'm going to go ahead and go to the calculator. Switch
gadget. Will do. Ah. 1000 Divided by. $4 and let's say 54 cents That would be about 220 shares. So I'm gonna do is I'm gonna change this to 220 years. Now trader was looking at a longer duration. They may not have a potential target in mind.
But what I'm gonna do is on the sell side, and it changes to a limit order and let's say I'll make this a limit. GTC. And then I'll go ahead and I'll set A target closer to that. $5 and 50 cents. They'll be counter to the higher end there. I'm ahead, Confirm and send There's amount of equity that we're tying up in the trade. And then I'm gonna go
ahead and click. Sent. Now notice that trade did not fill. That's because the price is pulling back. A buy stop would be triggered if the price Trades above that level. And since it
is a limit order that was placed As we click on that. If it hits $4.54. It will attempt to buy it at 4, 64 or better. Likewise we put in a limit. Order up nose made a mistake here. Notice the number of shares are different here. Ah we need to make sure
that that's the same amount so I'm going to right click on this. Cancel and replace order and make sure it's the same number of shares. Always make sure the shares match on the out . Uh as they do on the exit there. And for some reason, it's
not allowed me to do this. What happened here looks I may have lost some price action there. Ah I'll go ahead and I'll change that to make sure that I have that order matched with this by order. Let's go and take a look at one more. I think the other example. Ah I was looking at and
we'll do an example of a stock trade. We'll take a look at a d M ah. This is an example on the commodity side. Let's see if
that's still setting up. Look at ADM. For Archer Daniels Midland knows we're seeing a breakout.
Above a resistance kind of little more of a double bottom here. I'm gonna go and do an example of a buy with a one cancels other will go in. We'll set a target price and then likewise, we'll put in a stop price keeping in mind stops are not guaranteed to fill. At a particular price once filled compete with other income in market orders. Some do is I'm gonna right click kind of near that price there and I'm going to do a buy custom with OC eo bracket. Now I'll leave this as
a limit order. We'll have that as a marketable order since price is breaking out, and obviously a lot can change in 15 minutes, But the assumption is that the price is closing. Above that breakout point, and that CAHOLD-- close above high the low day As far as setting a target. One may go ahead and measure that previous move.
Whether it's a price pattern or a previous swing. So I'm just drawing a rectangle over that. Activate that drawing. And then
project that out. We do a lot this tomorrow and breakout reversals where we look as far as the price move, as well as the matter of time that may be required. No sin. This example. There may be some confluence with Previous price levels. Whether supporter resistance.
This case kind of pushing up around that 96 just shy in 97. We're seeing some momentum as saying some relative strength. Ah, again. I'm gonna go to that order. And then notice on the
sell order. We have a limit and a stop. I'll go ahead and I'll change the limit to gtc. Good til canceled. We want the orders to remain working will change the stop The GTC. Limit order
will be our target. Looks like we're Put that price in at 96. I'll do 96 90. Hit enter. And
then to stop the stop, maybe set a percentage. Below support or below the breakout point. Now here, I have $89 as far as being that potential support. I'll take that 89. Times. 0.97 will set at 3% below that. Breakout point that will be at 86 33.
Some traders may look at that previous low. And are 86 33 does put us a little bit below that low. So maybe a reasonable stop keeping in mind if the price hits 86 33. Once again, there's no guarantee that will fill at that price. Once it triggers it will create a market order. There could be some gap risk to that, if the market gaps at the opening But we'll go ahead and we'll adjust that. And make tha3
There we go. We'll do confirm and send. And then we can see the enter which will trigger an O. C. 01 cancels other basically if we hit our target price as an example it would fill We're potentially filled and 96 90 or better. Ah And if. If that happens, it will cancel the stop order if the price rules over and stops out. At or below that 86 33. It would fill at the
market order and it would cancel this so great example of planning a trade and trading a plan would encourage you to practice this possibly with some of your example. Trades there. So I'm gonna go ahead and send this one out. And we have that done. No, I didn't have time to do an individual. Ah, option
order. Although we've done that quite a bit. That would be an example of a conditional order. We'll go and we'll see if we can kind of get a few of those in tomorrow, and we're just a few moments left. Uh some other potential setups. That was looking at previously again.
These are not recommendations of buy or sell any security. Just some illustrations. Ah another. That's kind of tied into the I guess. Commodity space AG is CF. We did have a bit of a CAHOLD-.
But it did fade a little bit. Some traders may be looking at this as an example of a Triangle. Which means we may take a closer look at some of these tomorrow and breakdown reversals. There's a bit of a squeeze. Bearish case would be price breaking down. Bullish case may be looking for a bounce and prices breaking higher. Ah
was looking at an example of a Potentially long call spread, which is the opposite of that put spread that we talked about. Maybe keeping an eye on this for tomorrow or going into Thursday's class. If this would be a continue to be a relevant example to look at Another one on the E V space l I believe this falls under ah, some of the Chinese A DRS. Keep in mind a DRS. American depository receipts. Are foreign companies that are traded on a U. S
exchange. They are susceptible, as with many stocks to currency fluctuations, economic conditions as well as reporting of these companies may be a little different than one. What sees in the U. S. So there is certainly some risk to that. But we do see an example of a Break out of a potential inverse head and shoulders. A pattern that we
talked about, and will probably continue talking about tomorrow and break out and reversals. And then kind of on the chip side, And this may be an example. Or several examples on keep an eye on the bullish case for the market stocks such as Micron Forming a rectangle pushing up on that resistance. Is there going to be a breakout or not? As you look at other bellwethers such as Intel? Intel a bit weaker. But Is there signs of reversal? And then the example we're looking at an X P I.
Started to break kind of pulled back. Got a little more of an example of a waiting, see if we see a break out of that pattern . We found this informative here, folks as we spent some time reviewing Some of the current market conditions and applying that to some of our trade examples as we went through several of them both dealing with a stock or stocks as well as with options. Doing some examples of defined risk and utilizing the power to think or swim platform doing things such as buy stops as well as enter in CEOs or one cancels other So encouraged to continue practicing that on the thinker swim platform, utilizing the paperMoney folks, I'd like to thank Mr James Boyd for being with us and remember, in order to demonstrate the functioning of the platform, we had to use actual symbols. Keeping in mind
. Tdameritrade does not make recommendations or determine suitability of any security or strategy for individual traders . Any investment decision you make in a self directed account is solely your responsibility. Have a great day, Folks take
2022-06-03 01:37
