Just wanted to remind everyone that earnings season is starting again on 04.07.2009 with Alcoa. Remember that straddles and strangles options strategies are the best way to capitalize on these earnings events. With a straddle and/or strangle we look at the purchase of the long call and long put on the same stock. We want to have a big movement in the underlying stock either before or after earnings. Since earnings cause uncertainty and unexpected surprises we want to be in a neutral position around the earnings date. We can take advantage of this volatility and reap the rewards in our trading. Learn more about this strategy in Wizetradetv on demand by searching straddles/strangles.
Will be discussing more in detail as earnings season approaches!
Diane Sullivan
WizetradeTV Expert
Director of New Business
Do you have a group or association that wants to learn more about the stock market?
Does your company want to improve employee morale and retention?
Does your organization want to offer financial benefits to increase its membership?
If you answered yes to any of these questions, contact me at dsullivan@wizetrade.com to discuss how Wizetrade For Groups may benefit you.
We sold more used homes than expected. By the way some are saying at least 45% of them are foreclosed homes at huge discounts. Tim (Etch-a sketch) Treasuary Secretary actual showed up using whole sentences. Let's see we are going sell these assets for next to nothing to the same people who created them & so they can profit again & the taxpayers are taking the hit. My oh my why didn't I think of that.
The DIA broke the $74 support level today. Now I will be waiting to see if we test it again as new resistance next week. If we can't break $74 as resistance, we could see a continuation of our overall trend as it continues to move back in favor of the Long Term Chart.
Happy Trading!!
Angie C.
I’m currently using a strategy I created for CT that, every once in a while, is extremely good at finding up trends developing on all three major Wizeman. I simply look for the Month, Week and Day showing a fresh cross (green) at the same time. It's a very simple set of rules to create and automate. The strategy is designed to run on a basket of stocks when you’re in a large % of cash in your account.
I'm currently in:
ADM from 28.04 : trigger date 3/12.
HP from 22.81 : trigger date 3/12. Target hit and trailing.
JCG from 10.89: trigger date 3/12. Target hit and trailing.
The exits I use are based on % of the ATR. The strategy is on the Web community under NickP. Check it out and READ the descriptions.
On WT/ Wizefinder, simply set up a scan for the 3FWM as a fresh cross and do some chart reading for the best ones. For Options players, use Options Hunter in the same way and go out to at least 4 months.
Nick p.
NFLX has been making some great moves lately. I was on Channel 2 yesterday when we found this stock running a wizefinder scan. Yesterday when we found this stock it had a fresh cross on the short term trend, the overall trend looks great. So we took NFLX and put it into Wizetrade for Options and found a great option play on this stock. Today NFLX is up another .91 cents on the day and the trends still look strong even with this sell off today, the charts are green across the board. If you are not listening to the other channels on WTV, take a minute and join in. This is more or less a one on one class with an expert, so if your having some problems that need to be worked on these are a great place to get that one on one that make just make a difference in your training.
The market started off the day with another rally. If you were looking for CALLS to catch the move, you might have realized that it was a little late for the most part. This day started out as a possible 5th day of bullish movement, overextending the Short Term charts on a lot of stocks. The afternoon selloff was not a surprise. Whether it happened this afternoon or tomorrow, the overextension in the charts have been providing great opportunities for new PUT positions.
Now still be mindful of potential volatility due to upcoming news (FOMC on Wednesday). While it's not so much the news itself, but the fact that it can create volatility that you want to be aware of. Remember if you're buying options, increased volatility can increase the option premiums. When volatility leaves, it can reduce option prices. You don't want to be on the wrong side of that move.
Happy Trading!!
Angie C
On the heels of my collegue's comments from a couple of weeks ago, with all the volatility going on in the markets it's important to remember not to get caught up in the "hype" and trust your charts in anything you trade. But you don't want to ignore the market swings, that's where your money management comes in. Maybe that means smaller position sizing, adjusting your trade style, or adjusting your stops and exits.
Either way, only take what the market gives you and try not to be tempted to get ahead of a move.
Happy Trading!!
Angie C.
If you haven't checked out the Wizetrade Alerts, I think you might be missing out. You can log in at www.wizetradealerts.com or go through your Option Hunter. The alerts for stocks sometimes provide great opportunity for option traders, too. I want to show you a great example using one of yesterday's alerts:
Wizetrade Alert 3/4/09, 11:23 EST: “CAT setting up for active trade short!- CAT has a strong red long and mid term trend and is currently trading about $0.20 from the high of the day! It has also traded nearly 2 times its daily ATR. Look for a fresh cross on the 10 minute interval with the 2 & 5 showing angle and separation to time an entry. Consider setting stops above the $25.69 high of the day!!”
Just after 12:00 EST, after the continued run to the upside against the overall trend, the 30 minute light gave a great hook to the downside. The 10 minute got a fresh cross to the downside supported by the 2 intervals of fresh movement to the downside seen in the 5 minute light. With the volume push as the lines move lower in the 2 and 5 min charts, there was a great entry. CAT moved from $26.10 to $25.14 in less than an hour. Using a DEPOT option with an .85 delta, we made 7% (or $0.45/share) on an active trade. And by using only 3 contracts I didn’t over leverage myself with a total equity investment of only $1500.
Days like today, where the DOW is up 100+ points off of some lows we have not seen since 1997, I look for some long side opportunities to automate that will potentially trigger in a week or so. These strategies, like swing trade long or intermediate trade Long are run on those strong stocks on the month. Even thought he week has turned RED, I don’t care, because I now the rules to those strategies wont trigger the trade long unless the stocks get better on the weeks and days charts be design of the strategy.
For example, I’d consider the following:
MYL – Swing Trade long (strong sector- generic drugs within health care industry as a whole).
IBM- Intermediate trade long (strongest tech stock and in the DOW).
Akam- Position trade long or swing trade long (another decent strong tech stock).
even if your not automating , or simply a n options trader, these are stock on your list that you need to have on the programs overview screen. if your fully automating, your wont get in until he lights say so, if your in manual mode, stick to the correct entry methods and rules designed for these strategies. Never anticipate a move!!
Nick p.
Well it looked like it might rally today. This morning before the bell the futures were pointing up about 60 points. I will agree that it was kind of a weak rally after the 300 point sell off yesterday. The market deserves a good day or maybe even a good week to the upside. But we as Wizetraders are pretty much short this market and might not want to see a rally. My point is no matter what type of trader you are, you might want to think about tightening up stops if you think we might see some type of move off these lows and your short. Today we pretty much closed flat only down about 37 points on the DOW and 4.5 on the Q's.
