Using RSI, Moving Averages & Relative Strength | Technically Speaking: Trading Stocks & Options

Using RSI, Moving Averages & Relative Strength | Technically Speaking: Trading Stocks & Options

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[Music] [Applause] [Music] good afternoon everyone welcome to our technically speaking trading stocks and options i'm connie hill i'm happy to see that you would join me here today we always have a real good group very friendly you interact with each other which i totally love to see well do you feel like you're starting to think like a technician you know over the last few weeks we've talked about a lot of different indicators we've talked about the 10 30 crossover we've talked about how to use rsi in ranges and look for divergences touched a little bit on some other topics like fibonaccis so i hope in your head you're starting to look at charts and starting to think like a technician today we're going to do some reinforcements of using all those tools together and look at some new possibilities and we're going to modify our scan that we used last week so i've got a lot on the table here for us here today we will be joined in the chat by cameron may cameron will help me ask help answer your questions that you have so feel free go ahead chat those in and between either cameron or myself will try to get your questions answered those of you that are listening to this on a recording remember that you too can get your questions answered go ahead and put your question in the comment section i'll go back and review those uh typically in the mornings of each market day sometimes i'll do it a couple times so uh feel free to to use this so you can get your questions answered now i'm on twitter all right i've been actually a little bit busy on twitter lately my handle is at chill underscore tda and i'll post educational content throughout the day things that i think are interesting or useful i'm going to post those things out there for you to be able to see as well now cameron he is on twitter as well he is uh handle is cma underscore tda he posts a lot of interesting information that you'll want to have access to so take advantage of that it's completely free well let's go through our disclosures and get down to some business what we talked about today is intended for educational and informational purposes only it's not intended as a recommendation of any security strategy or account type options are not suitable to all investors as the special risks inherent options trading may expose investors to potentially rapid and substantial losses new strategies you always want to practice in your paper money account when we talk about probability results analysis uh remember when we're looking at probabilities that are theoretical in nature and are not guaranteed well this webcast discusses technical analysis other approaches including fundamental analysis may have very different views past performance of any security or strategy does not guarantee future results or success please no soliciting no recording take lots and lots of notes uh we'll take care of the recording for you and and hopefully get it posted a little bit later today all right our agenda i kind of told you a little bit what we're going to do in our agenda but we're going to review the markets using technician tools things that we have been talking about over the last few weeks we're going to do a quick trade review and we're going to review the results of a scan and take some further action with the results of that scan by way of paper example trades and we're also going to be using those tools that we've been talking about so quite a bit to digest here today i i understand it's it is a little bit of a full packet let's jump over to thinkorswim and let me oh get my chart the way i needed it uh i do have over here in the left hand side something we're going to refer to on my chart i have it's it's a little busy i realize that uh it has a fibonacci on it i've got a red 30-day moving average a 10 simple moving average both of these are simple i should say we're looking for the whatever the shorter term line is to help indicate the short-term trend so on this we're seeing basically the s p crossed over well it's 10 day crossed over the 30-day for just a very short period of time and then what i did do cross right back down now it is in a bit of a channel we did have a little bit of a three day sort of well maybe more like a two day rally looks like today it started rallying and right now i think it's it's a little bit negative uh the s p is i think the dow is i think the russell 2000 has been as well as the nasdaq so kind of turning the corner here or not turning the corner but here today giving up those gains now a couple of the other tools that we've used and talked about and if you haven't been here for those sessions don't worry i'll explain all of it but i'll also put links to those previous recordings in the in our description so you can go back and just click on the link for some of those previous discussions so one that we've spent a little bit of time on was with rsi and we looked at a couple of things where we looked at to see if we had our divergence because of divergence might mean things are going to change we also used it for the idea that there are bullish and bearish ranges with rsi i have those ranges down here so there's our divergences and when the rsi is in a bullish range i have the highs typically get in the 80s and 90s and the lows pull back to the 40s and 50s if a stock or an index that we're looking at is in a bearish range then 55 and 56 or 55 to 65s are where the highs are but the lows will go down to the 20s and 30s and that's another way we can gauge hey are we in a bullish market are we more in a bearish market and we've got relative strength down here as well what it will do we'll compare whatsoever in the box to what the index what the spx is doing now if you compare the spx to the spx we're going to have a flat line here okay but what we'll look for in some of the other indexes and stocks is we'll look to see is this line sloping up that would mean whatever is in here is trending stronger than the spx if it's sloping down that means the spx is trending stronger than what that stock happens to be uh andy says you're glad to be here i'm glad to have you here as well andy how do i import one of the scripts uh let's do that real quick because there could be others that are having that question as well and we really aren't going to be using these scripts today i do typically have them on my watch list here when i'm looking to see you know what different stocks are doing over the last month the last three months sometimes i'll bring up the six month or the 12th month as well and so those will just kind of sit over here but for example let's say um the three month return suppose you were interested in that i will well what i would do is i would copy it okay make sure you follow it's cap sensitive so make sure if it's capital letter make sure you do it you don't actually need all of this theoretically you just need what's after this front slash come up here to setup open shared item type or paste in the address hit preview and you might want to give it a different name it's going to import it as think script quote okay so for example mine i call this a three month percent change okay you could call whatever you want and then you hit import and then that'll allow you to choose it as a study when you've got either here columns on a watch list or if you go to the market watch tab and use the quote you can pull it up there as well for us today i'm not we're really probably not going to use these scripts so i'm going to hit cancel i don't need to bring it in again but that's how you do it for those of you that haven't seen these scripts before i will copy all of them over to you in fact i have to do it in a couple of groups however you need to know that they are not guaranteed as accuracy and timing okay and you can adjust them as well if you would like to and you know how think scripting works these are going to kind of go together like in a little paragraph so you're gonna have to do some separation those are the first two or first three and then i'll copy over these last to the one month and if you've seen it before the 12 sector grid that is kind of handy to have as well it's more of a chart script as opposed to a column calculation script all right let's get back to it using this tools as far as the rsi goes i'm going to zoom in here a little bit clearly is below our 10 moving average so the shorter term trend is showing definitely more bearish than bullish there's our 30 and there's you can see as the time goes on there's even bigger separation between the two so yeah definitely bearish as far as that goes we know we've been down at the bottom end of this channel that i've drawn in with the green lines those of you that follow fibonacci retracements i've got a fibonacci on here maybe i'll back up a little bit let me show you where it started where it came from i'm going to go to a two-year chart let's zoom out actually i need a three-year chart let's go to a three-year trend that'll show up a little bit better what i did with this fibonacci is i took the very top price and i retraced the really big move the move of where we had a low in that pullback when covid started and we had the market selling off in fact it was the fastest sell-off we've had to get into bear territory was also the fastest recovery we've ever seen but i took and did a fibonacci hitting the low here on that day hitting the high here if you're looking to know where uh what week we're looking at uh the high i believe here is on january 3rd the low here i believe was on march 23rd of 2020 okay if you're just trying to kind of pin those yourself and that i do have my high low bubbles on so that kind of helps finding finding them uh what's interesting what i wanted to point out to you is where we're sitting in kind of in this fibonacci sequence right now what are we seeing so now i'll zoom back in actually i'm going to take that back i am going to zoom in but i want a daily chart versus a a weekly chart so here's our spx the fibonacci retracement line that it's kind of sitting at that might be acting as a little bit of resistance we'll have to see is this 38.2 percent line many times these ratios and where we see the line many times we'll see it act as support and resistance even though maybe we haven't had something to exactly go to that spot and we don't haven't drawn in a support line or resistance line sometimes they'll be at those fib levels now i'm not going to go into major detail about how we calculate that fibonacci but what i do want to refer you to is go to the archives in getting started with technical analysis cameron may who's helping me out here today he has taught a couple of fabulous classes about fibonacci and he'll go through it at a very methodical pace so you can catch on to what's happening he'll explain what those ratio numbers are about and why they're even calculated okay so we're not going into deep detail here but go look for that in the archives i'll put a link in my description to one of the most recent ones that cameron has done unless he wants to show off himself and put it in there i'll still put it in the description all right let's get back here so we see on the rsi let's see are we seeing a divergence no we're still not seeing the divergence remember divergence is when we see the price doing something and the oscillator doing something different so if we're seeing the price of the index here make lower lows and lower highs we expect the oscillator to be doing the same thing if it doesn't that's what we call a divergence and so for example earlier in the year first part of the year the spx was making lower lows and lower highs but the rsi look what it was doing i was able to draw this little uptrend because the lows on the rsi kept getting a little bit higher and then we never know if it's going to follow through or not but then actually then yeah the the index followed through and started making higher highs and higher lows itself as far as the price action went but this gave us a little clue that it might start to happen price always has to confirm a divergence which it actually did there now the ranges we don't see a divergence and the lows here we've got a 31 we've got another 31 in change and we've got a 31 and high change so it's really hanging down here where these lows are in the 20s and 30s now i'm going to tell you that dao looks similar to the s p we'll take a quick look at the nasdaq the ndx we're seeing a similar thing it's been beaten up more okay from its peak to a low here has been more than what we were seeing on the spx so it is still in a bearish range as well we see it in a channel it's made a little bit more progress through the channel than what we were seeing on the spx but we do see the 10 moving average clearly below the 30 indicating shorter term trend is more bearish and on our rsi let's look at our lows we have one here at 33 we have another one here at 34. and then it's kind of flat since then so those are definitely in the bearish range for the lows the high and it's not all that high but let's say our we'll consider today are high it's at about what 30 or 41 and change so it isn't even into the high range here of the 55s and 65 so everything really is in that bearish range cameron i appreciate you putting in that playlist for the technical analysis getting started with that'll help them find those videos of the technical things you've been teaching over the last few weeks that's fantastic all right relative strength the nasdaq is kind of flat so it's weak very similar to what the spx is doing okay that's a review of our markets uh we've talked about before are we seeing the end of this pullback are we seeing any light at the end of that tunnel and the answer is not so much yet okay so we're still going to have a bearish focus next up uh i want to uh look at our one trade we still have going we put in a couple of trades last week and you know what they hit their stops they hit their stops they we traded out of them i do want to bring us back to this united uh united airline ual we did an iron condor trade on this a while back the call site of the iron condor isn't here anymore we got out of it it was sitting in such a nice position that we exited the trade early the put side however is not doing as well we looked at it briefly last week uh we are in a place where we're get we're pretty close to our max loss and so the thinking was well let's see what happens over the next week even though you know if this were a live account it's so deep in the money more likely than not in a live account it could be possible that we were already assigned on this particular one if you want to avoid assignment you've got to get out and close down the trade let's go just look at the chart here real quick and we'll see what we have going on so on united i'm going to leave our same studies up here because they can apply to what we're looking at here as well but we had a short call vertical on here our short leg was 52.50 and we exited the trade a while ago we got in here and it was sitting in pretty pretty shape for us in terms of being far far away from the 5250 so we closed it down we bought it back for just a few pennies right here i've got this green line here at 41 because that's where our short put vertical trade is and ideally bef when we put the trade on it was trading pretty nicely in a range but since then you know what has happened with travel stocks airlines hotels the world of leisure just totally getting hammered right now okay so what happened we are way deep in the money with these options if you were to go to the trade tab which i'm going to do just real quick and scroll down to these strike prices yellow means in the money they are both weighing the money and then i've got my column here what's the probability of this expiring out of the money come options expiration day in 22 days at 13 percent not looking so good and our long leg here is at 21 so not likely that these are going to shift and move and go above that 41 strike price okay not looking like it's going to happen a trader wants to minimize the risk okay so that being the case even though we're already at a max loss the spreads are still pretty decent on them we're going to go close the trade out we're going to take initiative and say we don't want to go through the assignment process and those extra fees we're just going to go ahead take it down but we are going to have a max loss on it and many times a max loss will wipe out several poly uh positive gains uh as far as we made a little bit uh we made a little bit here on our short call spread okay that'll help offset for the loss that we're taking here but nonetheless it's still a loss all right uh let's so let's just go close it down that's uh what we're going to do in our paper account even though yes we're at a max loss theoretically could it get worse um it possibly could in a scenario where the stock becomes really volatile and the spreads whiten out and then if you wanted to shut down the trade then you have to deal with wide spreads as well which theoretically could put you in a situation where you're losing more than your max potential uh loss might be if you were closing it down already okay we're going to avoid that we're just going to close down the trade avoid early assignment so we're going to create our closing order we're going to pick the top and that is putting us pretty close to our theoretical max loss we're going to hit confirm and send we will have 45 cents that we received in a credit that kind of offsets what that uh when this goes through for this price it kind of will offset that so it's not quite as bad but certainly is a loss so let's do our confirm and send notice we do have some commissions here because we have four contracts so that feeds into it as well we'll go ahead and send this off and we'll go again hopefully it'll go ahead and fill us all right next agenda item we're going to go to a scan and i'm not going to take the time to build this scan with you today but it's a scan i showed you last week again i'll put a link in the description to our class from last week where i showed you this scan but i made a modification to it okay ran it earlier today wasn't getting a lot and so i changed on it on the price change here my original parameter here was we were looking for the price to be down 25 percent uh in the last 30 bars that was kind of aggressive so i've changed it to 15 percent so basically over the last six weeks we're looking for the stock to be down 15 and then a very very short-term trade we're looking for it to be down in the last two weeks or 10 trading days 5 okay so that is a modification and look what comes up for us all right we don't have a ton we but we do have 10 stocks and they're all inter well i shouldn't say all most of them are interesting there are a couple i didn't look at but the ones i looked at are kind of interesting uh let's start out with mosaic now on mosaic we're going to pull up the chart and i think i want to clean it up a little bit at this point uh yes we can see the rsi is still going down still is in a bearish range for the peaks and the pullback and this stock is trading more weak or trading weekly compared to what the spx is doing so it's uh weak on many fronts okay you should use we're thinking like a technician here and we're thinking it's below the 10 moving average and the 10 has been headed down and there's separation a little bit of separation there rsi is down in a bearish range no divergence in sight and is trading wheat compared to the spx so those are the thoughts a technician might have here now it had some interesting news it looks like this morning what it reported is that it had some sales but the volume was way down their sales for this quarter uh was higher than the previous year but it was on much lower volume and that is what the market's reacting to here today is that news if you want to check that story out now on this when we're trying to get into something bearish we're looking for a couple of critical things one is it breaking a support level and dropping through that we've seen a lot of that lately or is it uh dropping down or bouncing down off of some resistance and i kind of feel like it's uh it's in this case it kind of looks like both but i'm going to back out and i'm going to bring in a longer term chart here we're going to go back three years we're going to see okay when has mosaic traded in this range in the past so this is now a weekly chart and here the the moving averages have switched because now they're weeks and not days okay but i was looking for some some older resistance where is it going to be you know so we can see well yeah back here it traded way lower but you know maybe was there some support in this time frame so i'm going to zoom in and we'll see okay uh looks like maybe maybe this was an old resistance area could act as new support came down here a little bit lower and i'm seeing okay maybe right even right there at that point with a 30 a moving average maybe that is a support level so i want to draw that in i'm going to do it as close to it as what my eye sees it touching it and then i'm going to extend this to the right so we see where that might be now stops at 46 that line is at 34. that's a big stretch right that's a 12 point drop so you know it may find some support before that point but if somebody wanted to be really directional on it that might be a target now i'm going to say it might be an aggressive target given that that's 12 bucks away i'm not going to figure the percent on that but that's pretty high the other place it may drop to can you see here on in these weeks maybe that was an old resistance and many times support and resistance are going to change we're going to change position on us i'm going to kind of draw it where i see it there could be a little bit of room for the stock to drop maybe about three or four dollars where it is right now now let's go back to our daily chart and uh yeah let's go six months here and we can see there's a little bit of range for it to pull back to right there's a little bit of dropping room maybe it goes further if somebody's being pretty conservative with something like this they might say you know let's just see if it'll stay below a certain point you know if it had maybe some resistance up in this area you know that's going to be about 53 but that's always away from where the stock is trading right now but it might be helpful if it would stay below a certain point uh what i was looking at earlier is today's high is about fifty dollars and when we go out and look at some strike prices we may find something that's favorable in that area so we're going to go to the trade tab and i have pulled up here the july options typically when selling spreads we look to sell between 20 to 50 days worth of time sometimes we find something that's perfect and sometimes it's not here let's look to do a short call vertical we might be concerned about when earnings is going to happen so the last earnings here was may 2nd so maybe about first part of august we might expect these guys to announce their earnings again if somebody wants to avoid it then they might need to choose something from a monthly here or some of these weeklies by going out to the august 5 we if we did that we might get caught in the earnings announcement so we might want to pick one of these others now i already checked them out they don't have a ton of open interest and you know i'm a big fan you've got to have open interest in those strike prices but let's come up here many times traders will sell between a 20 to 40 delta so let's see what we have we do have a 20 a 23 a 32 34 and then up here to 42 but as we look at the open interest we really don't have a ton available in fact some of these are still zero even though some of those contracts were opened tuesday when the market came back and opened up so here really as far as likely we might say well let's see if we can sell the 50 strike price that's kind of at the top of where today's candle was and it's had a decent drop today that would give us about four dollars worth of range we might look to sell that i like the open interest here so what if we sold a 50 and bought a 51 well i don't like the 48 open interest in the 51 strike price you know in this account we could do a few contracts and we want there to be more contracts out there so we could say forget it i'm not going to do it or we could say well if we maybe spread it out by two strikes we have 117 contracts in here that feels a little bit better okay then something that is in the low numbers so let's do that let's do a 50 that we're going to sell we're going to spread it out by two strikes so we can use this 52. so we're going to sell the vertical it's going to bring in that next strike price it can't read our mind and change it but we can change it here we're going to select here the 52 and here's the credit 46 cents i'm going to hit the lock so we can work with numbers that aren't floating around everywhere let me get rid of the news because i want some area down here to make some notes so our mass potential theoretically of this trade is going to be 46 basically dollars per contract that we do do you guys know what the max loss is can you just do the math really quickly on this yeah it's going to be two dollars the difference in the spread minus what the credit is right here so we're looking at what about a buck 54.

so we're going to take our 46 cents divide it by a buck 54 and let's see what that percentage is see if it's reasonable i'll do this calculator here in front of you and let's move our little notes up here so we're going to go 0.46 theoretical max gain 1.54 theoretical max loss that says that's a 29 return now if we were selling 20 to 50 days worth of time there might be some people that find that acceptable we're selling 22 days worth of time so really we're we're shooting to get that theoretical max gain in a shorter period of time when you have something like that some traders might say you know if it's a little bit lower than that you know say it was 27 or 25 they might say you know what i like that i'm getting at least a one uh i'm getting at least uh a percent for every day left of this option's life now we're not planning to stay in 22 days uh but that can be a way to think about it when you're looking at a shorter time frame which we are for these july options any questions there if so chat him in cameron's an expert he can help us out uh if it's something that is more up his alley all right uh wayne i'm seeing your question here let's answer it i heard from ben that the coaches will be going back out on the road will you still have webcasts the answer is yes we are going to resume doing some of our live workshops out on the road when coveted came we had to shut those workshops down everybody went home everybody tried to stay safe and not get sick and so we're getting at a point that maybe we can start doing those workshops again and those workshops occur maybe about once a month uh we'll see how many they fit in for the rest of this year and we'll be going to very specific cities uh but yeah we're going to still have webcasts we need to keep up with our routine even though maybe for a day or two we have a coach out on the road or uh at one of those workshops okay so do not fear we are here and my understanding is that we will still continue to be here all right good question let's take our trade here how many how many contracts can we do if we are gonna lose or are willing to lose 750 in any single trade because that's what our account will allow and we're going to lose 154 per contract we can do four contracts here so let's do four contracts let's also put in a buyback order we're going to change this to a first trigger sequential we're going to create an opposite order here and then when we get a majority of that 46 cents let's get out of the trade let's not squeeze the everything out of it like i do a tooth toothpaste out of the tube right uh leave a little toothpaste in this tray okay we're going to say hey if we get a lot of it we're going to be happy campers so 46 cents times i'm going to go 85 if we get 85 percent that means there's 15 percent left we could go buy back the spread i'm going to put that at seven cents we're going to round up here a little and we're going to make that good till cancelled okay we are sending it out as a limit order didn't take that let's try it again okay there that sticks that time let's hit our confirm and send just review it make sure you haven't made any mistakes you know hit a number wrong we're going to have some commissions on this all right the total cost for those eight contracts is going to be 10 40. okay uh let's go ahead we're going to put this in our account of what we're watching trading stocks and options we're going to send it on uh i'm not going to get into it too much but last week we also talked about why we wouldn't short stock there are some of you that aren't option traders yet you might be working that direction and in a bearish market for purposes of our class we're only going to do option trades because shorting stock could have potentially uh potentially unlimited risk okay so that's not why we're not going to do that uh let's see tm i will i hope you're wondering how we can attend in person how you can attend in person let me show you that at the end of our class we'll answer that question show you where to go so you can see all right another stock that came back in our scan we had mosaic airbnb alcoa alcoa interestingly enough it's down a little bit today isn't it but i have a column here that shows the three month percent return this particular think script alcoa in the last three months has been down about 51 in fact it's one of the bigger ones in terms of that loss over the last three months which makes it quite interesting so we know it's not just moving down a little bit it's been moving down a lot so let's bring alcohol up here and see what's going on i'm just going to let you be the technician and run through what you think the chart is doing as far as the moving averages the rsi and the relative strength you make that on your own analysis as we do that thing i'm going to note on is we've got a downward trending stock and what is it doing looks like it is continuing to bounce down this probably was the higher candle on this day when with this little kind of a run up this is a high candle it's kind of sideways here as well uh but the low that day is 49.49 so to get a close below the low of the high day we'd want to see a closing price below 49.49 and did it do it um it went to 48.90 on this green candle

day so even though it's green it closed lower than what the low of that candle was so technically yesterday could have been an entry for somebody looking for a close below the low of the high day we didn't see it while we weren't together okay so we're just gonna take action on it today same thing uh when might earnings be now their earnings could be out here this is saying july 14th okay uh alcoa is early in the earnings announcements so it could be around that 14th that's three months later than what it was here about the 20th so we'll see where they announce but thinking about that that might influence what you select as far as strike prices or contracts right you might select some weeklies out here if it's in the neighborhood of expiring july 15th that's going to be a friday we may actually run over some earnings but certainly choosing further out we will have to hold it across earnings and some people just don't like to do that some people say let's make the trade before earnings comes or wait till the announcement comes out and then take action on it now i think we're still in our window here 20 to 40 days let's see what possibilities might be we could if somebody wants to be more directional we definitely have lots of open interest here on the put side on the call side it's not as plentiful is it yeah it really isn't not like the put side here so we could consider um doing a couple of different trades the other thing i thought of is if we did want more time we could do that and we could go out to august but no probably have to hold over earnings because we want to wait for that time to decay but let's do this let's sell the 50 strike price it's got over a thousand contracts and let's spread it out by 2 again doing the 50 and the 52 ironically the same strike prices as our previous trade let's go ahead and sell the vertical i'm going to swap the 51 out for the 52 and let's see what kind of a return we get about uh i'm going to take that 50 cents let's lock it in uh is that a significant amount of a return to hold for 22 days some of you are going to know right off the bat so we've got our max theoretical gain of 50 cents we're going to divide that by our max theoretical loss of buck 50 and that says wow a 47 return well what's the likelihood of that okay if we come over here to our strike price and our short legs to 50 the probability of it expiring out of the money wow it's already 72 for that higher premium but remember it's probably a little bit higher because of earnings probably more implied volatility priced into that option and even as we get closer to options expiration date the premium could actually go up a little bit because of the implied volatility say the stock doesn't move down that much but kind of goes flat implied volatility yeah that could make it a little bit harder for us to bleed out that that time decay out of the spread so you could say well let's maybe just go out further then i'm going to show you this really quickly i said well what if we did go out to august i looked at this already it's a little over 50 days it's got 57 days there let's pull it out of the way for a minute and say we did something a little bit further out of the out of the way it's a little bit tricky because we've got a 30 delta and a 20 delta 43 delta we've got a little bit of open interest here for our small number of contracts that we could do but notice what we've got here we've got 50 55 okay so it's a five dollar spread 55.60 so we might not have something ideal let's see if we sold the 55 and bought the 60 as the hedge leg if we were to sell that let's see if it gives us a good enough credit that we would be happy with it okay in this case it's 90 cents so 90 cents or 90 our theoretical max potential profit what would be our max loss theoretically our theoretical max loss is going to be five dollars minus the 90 cents that's going to give us 410 right so let's run the math and just see what the percent is and then you can tell me do you want choi you want trade 1 july you want trade 2 august okay so we're going to go theoretical max gain of 90 divided by theoretical max loss of 410 that's a 21 percent return okay for a longer period of time the trade-off is you get a lot of distance right if we're short the 55 here we've got about 10 dollars of leeway now there might be some of you that might sleep better with that because you do have quite a distance away here instead of fifty dollars you gotta come up a little bit higher uh where my mouse is now is about the 55 if not right then we're going to be talking about 45 or 50 rather pretty close to where that line is just kind of a little bit below it which trade would you prefer i've got the two queued up would you prefer the july trade that gives us a 29 return which is pretty decent for 22 days or would you prefer bigger a bigger moat between the price and our short strike bringing in a lower return because maybe you feel like that's in your comfort range a little bit better so i'm just curious it's going to take a minute for you to chat those answers in and we're coming up on our time here so let's just kind of see what those of you that are the most vocal uh what you think there's not a right there's not a wrong here if we're risking a buck 54 we could do how many contracts could we do five contracts here yeah we could if we're risking 410 here per contract because the spread so wide we could only do one because if we did two we would exceed our 750 that we're willing to risk on any trade okay starting to get some answers back here vijay votes for the first one all right chuck likes the july as well lori likes the first one as well okay you guys we're gonna delete this i'm gonna go ahead i'm gonna submit the order like it is with five contracts oop that actually is too many we're gonna have to go four contracts we're gonna hit the confirm and send we're just gonna check our math here just make sure we didn't do anything wrong notice there is going to be a little bit of a commission for those contracts 5.20 so probably about the same price as a regular hamburger these days i'm going to stick it in our trading stocks and options class i'm going to go back after the class and put in a buy back i'm going to use that 85 as well if we get 85 percent kind of a majority of that spread we're going to go ahead and buy it back i'll put that order in okay looks like we got filled immediately we even got 52 cents on it okay um there's a couple of you that would have done the august trade i appreciate you sending that information like i said there's not a right or wrong it can be your comfort level as you practice these strategies looks like we checked off all of our agenda items today what would i want you to do well i want you to maybe create a study set or a style with the studies that we've been talking about over the last few weeks i want you to be doing your own analysis putting on your technician cap so to speak and seeing what you think those studies are showing or teaching us about are we still bullish i mean bearish or are things starting maybe to recover and and we're starting to see light okay so i want you to do that take a look at it every day and then practice whatever bearish strategies you know practice in your paper money account uh now is a great time to be doing it if we get a bounce in the market we'll see if we actually get one uh things might be changing a little bit we'll have to see what actually happens all right so that's what i want you to do uh emj says the bpa is the cost of the trading is 600 okay oh per trade or six hundred dollars for the trade but six hundred dollars for the trade that's great it's less than uh well the max loss is really what we position to not necessarily the margin that's withheld okay uh well as we wrap up i just need to remind you that what we talked about today is for educational and informational purposes only not investment advice or a suggestion or recommendation of any security strategy or account type you guys have been fantastic here today i appreciate you being here cameron i appreciate you being here answering questions helping out with our class that always helps when we have another individual here doing that so appreciate cameron's help here today hey you guys trading the trend is going to be up next it's going to be right at the top of the hour with james boyd he'd love to see you there i know you guys know it'll be a great class as well okay we'll see you next week bye [Music] you

2022-06-26 14:42

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