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Hi, this is A.J. Brown with Trading Trainer on the evening of Friday, June 15, with your Trading Trainer weekend edition of your daily insights. What we’re going to do here is take a look at the broad market by taking a look at representative indexes of our watch list, mainly the Dow Jones Industrial Average, the NASDAQ Composite index, and the S&P 500 index. We’re also going to take a look at the New York Stock Exchange Composite index and the VIX Volatility index, and because it is the weekend, we’re going to take a look at both daily and weekly charts.

Before looking at any charts, we are actually going to log into the Trading Trainer ‘Learning Community’ web portal by going to login.tradingtrainer.com. Of course, once we’ve logged into the ‘Learning Community’ web portal, I’m going to direct you right to today’s Daily Insights tab and further to the Recommendation sub tab. Take a look at the recommendations we have for Monday, June 18’s trading session. Slight changes in these recommendations could have a major impact on your trading.

You are also going to find here a link to our audio commentary. This is the audio where I take you by the hand through today’s Daily Insights tab and its sub-tabs; go ahead and click on that link. An audio is going to start playing automagically in the background, in another browser tab or another browser window, depending on how you have your browser configured. Go ahead and listen to that audio the first time you do click through today’s Daily Insights tab and its sub-tabs; it will make sure you hit all the high points. You can always drill down deeper on your own after the audio is over. When you listen to the audio commentary, please pay special attention to the opening and closing comments. In the meantime, for this particular Broad Market Analysis of this Charts of Interest video series, let’s go right to our Daily Insights tab and our Index Stats sub tab.

Our trading bias remains neutral/bullish. Our industrials shown by the Dow Jones Industrial Average, fell 0.34% on heavy, above average New York Stock Exchange volume today, and fell 0.89% for the week on heavy, above average New York Stock Exchange weekly volume. Our technology stocks shown by the NASDAQ Composite Index fell 0.19% on heavy, above average NASDAQ exchange volume, and for this past week gained 1.32% on heavy, above average NASDAQ exchange weekly volume. Our large caps shown by the S&P 500 index, fell 0.1% today and edged up 0.02% for this past week.

On to our secondary indexes. Our 100 best stocks out there shown by the S&P 100 fell 0.12% today and fell 0.13% for this past week. Our mid-caps, shown by the S&P 400 index, fell 0.17% today and 0.41% for this past week. Our small-caps shown by the S&P 600 and the Russell 2000, two different perspectives on small caps, edged up 0.04% and edged down 0.05% respectively for today, and edged up 0.09% and gained 0.68%, respectively for this past week. Our New York Stock Exchange Composite Index fell 0.29% today and fell 0.76% for this past week. Our VIX Volatility index fell 1.16% today and fell 1.64% for this past week. Our Gold ETF fell 1.65% for today and fell 1.36% for this past week. Our Oil ETF fell 3.48% today and fell 1.66% for this past week.

Team, let us take a look at our economic calendar by clicking on our Daily Insights tab and our Economic Calendar sub tab. First thing I’d like you to do is pay attention to today’s ‘Market Reflections’ summary. After reading today’s ‘Market Reflections’ summary, click over to Monday’s ‘Market Focus’ pointers. After reading Monday’s ‘Market Focus’ pointers, please pay attention to the two reports that could be found also on Monday in our economic calendar, namely the ‘International Perspective’ and the ‘Simply Economics’ reports. These two reports are summaries of what happened the previous week and what’s coming up for the week to come. These two reports are must-reads for any good investor and they’re must-reads to be done this weekend. Please check these two reports out.

In the meantime, coming back to today. We saw our Empire State Manufacturing Survey released. In May, the General Business Conditions index was 20.1. In June it’s coming in at 25. Our Industrial Production numbers were reported today. In April, production was up 0.7%. We revised that production number to be up 0.9%. For May, we’re reporting a drop of 0.1%. The capacity utilization rate in April was up 78%. We revised that to be higher at 78.1%. The May numbers came in at 77.9%. Consumer Sentiment was reported. This is mid-month. Last time we reported it was 98. This time we’re reporting 99.3. And, the Treasury International Capital was reported. The foreign demand for long-term US securities, back in March, was 61.8 billion, in April 93.9 billion.

Basically, what we’re seeing here is strong retail and wage inflation, causing our U.S. Central Bank as well as the one in Europe… causing these central banks to want to tighten our monetary policies. The European Central Bank is ending their quantitative easing. The Federal Reserve here in the United States is raising interest rates and unwinding their quantitative easing at an increasing pace. But at the same times, we’re starting to see the underpinnings fall out in wholesale inflation and industrial production, et cetera. The bond yield curves are flattening. We’re seeing erosion. Stay tuned for some more in that area.

Team, let’s move on. Let’s take a look at our Trading Tools and our Watch List sub-tab. There were only five tickers identified by the options trading candidate filter. Two of them are not highlighted in yellow; those two are already on our watch list. They are simply reaffirming their position there. The other three that are highlighted in yellow; we will evaluate their liquidity and patterns before adding them permanently to our list.

Moving on to our Trading Tools tab and our Daily Picks sub tab. Here we are going to do a deeper dive on our indexes by running our Trading Trainer ‘Daily Picks’ report generation tool. First, we’re looking specifically for volume and trends. Volume was very strong today. This is the result of what we call quadruple witching, where not only do options expire, but futures expired. Single stock futures expired and options on indexes expired. All of those transactions that were made with promises in earlier dates, all came to fruition today at expiration. Our short-term trends are faltering, but our long-term trends seem to be stalwart at a long, bullish bias.

I’m going to take a look at our template algorithm filters. These all mathematically go through whatever raw data they are presented with, looking for patterns in the numbers. We’re going to present the raw data of our index tickers to these templates, to get an idea of what the broad market personality is doing, as well as what to look for in our watch list. Reactive, Buffered and Chaiken, all showing neutral right now. However, we have enough trend in all of them to start seeing signals being generated. Our Trend Reversal remains bullish for the most part. Our Short Term Trend test is in a range contraction phase; it’s either neutral or even hinting at a little bit of bearishness. Our bar counter is still in the single digits, whereas our Bollinger Band width index, is still in the medium zone.

Let’s take a look at our charts by going to our Trading Tools tab, and our Charting sub tab. We’ll start with a Quick Review template, which is a six-month chart with open-high-low-close bars, that are daily in length. These daily bars are linear in scale, and there’s a separate pane for volume and volume average. To that, I’d like to add my 30, 50 and 200-day simple moving averages. These lagging indicators help me determine the trend. I have these simple moving averages added to the Quick Review template here in a user-defined template area, in my personal profile. I’m going to apply that user-defined template to my indexes. Specifically starting out with the Dow Jones Industrial Average.

We’ll start with a weekly chart with two years worth of data. As we can see here, our polarity continues to be bullish. This week’s volume is skewed from today’s quadruple witching. Switching to a six month chart with daily bars. Price seems to have been tested with a level of resistance and is rebounding down. Although, today’s bar shows some resiliency. The volume again is artificially skewed, so it’s hard to see whether we had volume validation in its truest sense. The 200 is pointing up. The 50 and 30 are pointing up. Our seven day simple moving average has caught up with price and flattened out, but it’s still oriented for a bull trend with respect to the other three. Switching to a five minute chart. Today, we saw a dip in price right at open and then in the late afternoon session, we saw a pop back up in price. Switching back to our daily chart. The Dow Jones Industrial Average closed at $25,090.48. This is actually not a bad move for the Dow Jones Industrial Average. With our higher high after lower low, this could be our chance to reset the index, and allow us to really search for a new high on a bull trend. Don’t know that for sure yet, but it is something for us to watch. We’re testing bull on our polarity. Our trading bias remains neutral/bullish.

Moving on to the NASDAQ exchange. Going on to a weekly chart with two years worth of bars. Our seven-week is pointing up, our 30 and 50-week are pointing up. Our 200 week is pointing up. This is a bullish polarity and a bullish bias on the weekly chart. Switching to our six month, daily chart. Our simple moving averages are all trending up. We see the effects of quadruple witching on volume today. Moving on to our five minute chart. Again, we can see a dip in the NASDAQ today, but a slow rise throughout the day. We closed at $7,746.38. Our low is $7,704.34. So it’s time for us to identify a new level of support and resistance. It looks like we’re wrestling with all-time highs. Let’s go ahead and take a look at a weekly, two year chart. Now, we’ll move back to our daily, six month chart. We’ll use $7,600 as our level of support, and we’ll use $7,800 as our new level of resistance. Everything else remains the same, including our bullish trading bias.

Moving on to our S&P 500 index. This is the index I feel like most represent our watch list. Going to a weekly, two-year chart. All price action for this past week was very much a stall, but a stall in a long-term bull trend. Moving to a six month, daily chart. Again, we’re not sure if we’re simply testing the long-term bull trend, or we have found a top. Our simple moving averages are all trending higher. Quadruple witching doesn’t give us much understanding of what happened today. Our five-minute chart again shows a gap down at open, probably on rhetoric around tariffs on China, and then popped up later in the day. We closed at $2,779.66. Our trading bias stays at neutral/bullish.

Looking at the New York Stock Exchange Composite Index. Starting with the weekly, two-year chart, we are trending up. Back to a six month, daily chart. Huge consolidation of these simple moving averages has me thinking the market is ready to make a move, as this pressure builds, but in the meantime, we’ll keep our trading bias at neutral.

Looking at the VIX Volatility index. Starting with a weekly, two-year chart, looking at a 40-week simple moving average. The implied volatility for the week seems a little bit lower than the simple moving average, but not by much. Basically, we’re loitering around that mean...

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A definition of an investor that I’ve always liked is a person who earns money from their various investments – in other words, they use their money to generate more money. The lure of being a full-time investor is often time and location freedom. I know that is what excited me. But, having been a full-time investor since 2005, and a part-time investor since 1997, I have learned all too well you do not get something for nothing; there are always tradeoffs.

To be a full-time investor, unless we are dealing with a monumentally large portfolio, we will not be able to support ourselves unless we are making very large returns. Most full-time investors start with very large portfolios they have generated through other means, like being a business owner, self-employed, or an employee. They have such a large “golden goose” to start with, the “eggs” it produces at low rates of return, are enough to live on. If we are looking to grow a small portfolio to a size that can support us, our money will need to work very hard.

I have found there is an inverse relationship between the amount of reward (and risk) an investment might have, and how much knowledge, experience, and effort we need to put in. There are definitely ways to increase efficiencies. Technology can help. Most of all, though, it takes repetition. Repetition of best practices. Repetition of things that don’t work creates bad habits. It is a perfect practice that makes perfect.

How long will it take?

That’s the question that is on the minds of most beginner traders.

How long before you figure out the market? How long before you stop losing money on 50%… 60%… 70% of your trades? How long before you start making money?

What’s critical to understand is that it is important to learn about investing and trading correctly from the get-go. Unlearning bad habits from repetitively doing things incorrectly takes an incredibly long amount of time than learning how to do things right from the outset.

So how long will it take?

Author Malcolm Gladwell came up with something called…

The 10,000 Hour Rule

It’s a principle that says – if you want to master ANY skill – you need to invest 10,000 hours of “deliberate practice” to do it. The NYSE is open 6 and ½ hours per day – 5 days a week.

At that rate, it’d take nearly 5 years 11 months to master trading.

Oof.

The good news is that you don’t need to be a master to start making money.

So… How long does it take to do that?

I’ve recorded a video to answer that question.

Click the video above to watch it now.

You might be surprised by the answer.

About The Author

A.J. Brown is widely recognized as “the world’s most disciplined option trader.” He has been actively trading equities and options since 1997, and has published daily insights for his Trading Trainer program participants every single night, 5-days a week, since 2002. He is the author of the wildly successful e-book called “The Seven Strategies of Successful Options Traders” and his home study courses and video series can be found in the libraries of the most successful investors and often times referred to by them as their secret weapons. Trading Trainer is based out of Fort Collins, Colorado.

The post How Long Until You Don’t Suck at Trading? appeared first on Trading Trainer.

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How to Generate a Serious Income Selling Options: Secrets from a Trading Pro
A.J. Brown, Trading Trainer

Join trading veteran A.J. Brown for this exciting presentation, where he will discuss:

  • How can options be traded for income?
  • Why the income grows exponentially, not linearly, with time.
  • The 3 Simple Steps to setting up these trades.
  • How to build in “safeties” into your trades so your risk is less.
  • PLUS a whole LOT More!

When you’re done with this presentation, click here to visit our FREE video training.

About The Presenter

A.J. Brown is widely recognized as “the world’s most disciplined option trader.” He has been actively trading options for more than 18 years, and has published daily insights for his Trading Trainer program participants every single night, 5 days a week, since 2002.

The post Candlestick Trading Forum: How to Generate a Serious Income Selling Options appeared first on Trading Trainer.

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Hi, this is A.J. Brown with Trading Trainer on the morning of Saturday, June 9, with your Trading Trainer weekend edition of your Daily Insights. What we’re going to do here is take a look at the broad market by taking a look at representative indexes of our watch list, namely, the Dow Jones Industrial Average, the NASDAQ Composite Index, and the S&P 500 Index. We’re also going to take a look at the New York Stock Exchange Composite Index and the VIX Volatility Index. And because it is the weekend, we’re going to take a look at both daily and weekly charts.

But before looking at any charts, we’re actually going to log in to the Trading Trainer ‘Learning Community’ web portal by going to login.tradingtrainer.com. Of course, once we’ve logged into the ‘Learning Community’ web portal, I’m going to direct you right to today’s Daily Insights tab, and, further, to the Recommendations sub-tabs.

Team, take a look at the recommendations we have for Monday, June 11’s trading session. Slight changes in these recommendations could have a major impact on your trading.

You are also going to find here a link to our audio commentary. This is the audio where I take you by the hand through today’s Daily Insights and its sub-tabs. Go ahead and click on that link. An audio is going to start playing automagically in the background in another browser tab or another browser window depending on how you have your browser configured. Go ahead and listen to that audio the first time you do click through today’s Daily Insights tab and it’s sub-tabs. It will make sure you hit all the high points. You can always drill down deeper on your own after the audio is over. When you listen to the audio commentary, please pay special close attention to the opening and closing comments. In the meantime, for this particular broad market analysis of this Charts of Interest video series, let’s click right here on the Daily Insights tab and the Index Stats sub-tab.

Our trading bias is neutral bullish. Our industrials, shown by the Dow Jones Industrial Average, gained 0.3% on light below average New York Stock Exchange volume and for this past week, gained 2.77% on light below average New York Stock Exchange weekly volume. Our technology stocks shown by the NASDAQ Composite Index gained 0.14% this past Friday on light below average NASDAQ exchange volume and gained 1.21% for this past week on light mixed average NASDAQ exchange weekly volume. Our large caps shown by the S&P 500 Index gained 0.31% this past Friday and gained 1.62% for this past week.

Moving on to our secondary indexes, our 100 best stocks out there shown by the S&P 100, gained 0.25% this past Friday and 1.65% for this past week. Our mid-caps, shown by the S&P 400 Index, gained 0.5% this past Friday and 2.16% for this past week. Our small-cap, shown by the Russell 2000, gained 0.28% for this past Friday and gained 1.49% for this past week. Our New York Stock Exchange Composite Index gained 0.34% this past Friday and 1.67% for this past week. Our VIX Volatility Index gained 0.41% for this past Friday and fell 9.51% for this past week to close at $12.18. Our Gold ETF gained 0.12% this past Friday and gained 0.42% for this past week. Our Oil ETF fell 0.6% this past Friday and gained 0.15% for this past week.

Team, let’s take a look at our Economic Calendar by going to our Daily Insights tab and our Economic Calendar sub-tab. First thing I’d like you to do is take a look at this past Friday, June 8th’s Market Reflections summary and then move to Monday, June 11’s Market Focus pointers. Also, you’re going to find the International Perspective and Simply Economics reports. These two reports are must-reads over the weekend. These two reports give a very good summary, both internationally and domestically, of what happened the previous week and what to expect for the week to come. Take a moment this weekend and read these two reports.

Looking back at this past Friday, June 8, it was a mild economic news day. Our wholesale trade numbers were released. In March, inventories were up 0.3% month over month. We revised that March number this time around to be up only 0.2%. And for April, inventories only increased by 0.1%. Looking forward to next week, the big news will be any sort of gossip coming from the G7 meeting over this weekend, as well as a lot of folks will be focusing on the Federal Open Market committee meeting that starts this Tuesday and ends this Wednesday. This is one of those meetings that the Federal Open Market committee will actually hold a press conference led by the chairperson. So a lot of eyes will be focused on that. Often in the past, leading up to the Wednesday monetary policy release, it is calm, but yet we see “pressure is building” sort of trading. On Thursday and Friday, we have a lot of economic news, so I expect movements more to be later in the week.

Let’s take a look at our Trading Tools tab and our Watch List sub-tab. We have five tickers identified by our Options Trading Candidate filter. One of those candidates is not highlighted in yellow. That candidate is already on our watch list. It is simply reaffirming its position there. The other four candidates, we will evaluate for liquidity and patterns before adding them permanently to our list.

Taking a look at our Trading Tools tab and our Daily Picks sub-tab, here you’ll find our Trading Trainer Daily Picks report generation tool. Let’s do a deeper dive on our indexes by looking at volume and trends. The volume was very low on the New York Stock Exchange and NASDAQ compared to Thursday; also low compared to the 50-day and 200-day volume simple moving averages. The trends in the short duration, across the board, are bullish. In the long duration, for the most part, they are bullish as well.

Let’s take our template algorithm filters. These mathematically go through whatever raw data we present them with and look for patterns in the numbers. We’re going to present these template algorithm filters with our index tickers. That’s going to give us an idea what the broad market personality is doing as well as what to look for in our watch lists. Our trend continuations are building up enough trend to start giving us signals. We need to have a long-term trend before we can start identifying trend continuations. Our short-term trend test and trend reversal tests are showing bullishness, if not already a moment of range contraction after our first range expansion phase since the most recent reversal up. Our pattern alteration template, for the most part, shows that we are pushing to the top side of our channel, perhaps establishing a new bull trend.

Let’s go to our Trading Tools tab and our Charting sub-tab. We’re going to take our Quick Review template, which is a six-month chart that has daily open-high-low-close bars and a linear scale. To that, I’m going to add my 30, 50, and 200-day simple moving averages. These lagging indicators help me determine the trend. I have these simple moving averages added to the Quick Review template here in a user-defined template in my personal profile. I’m going to apply that template to the indexes, specifically starting out with the Dow Jones Industrial Average.

We will start with a weekly chart with two years worth of bars. This week was a beautiful S bar on strong volume, giving us a hint that perhaps we have broken out of our sideways channel. We’ll need to have further reinforcement of that idea, but the underpinnings are strong. Our weekly polarity remains bullish. Going to a six-month chart with daily bars, all our simple moving averages are pointing up and are oriented to each other correctly for an uptrend. This Friday we had a nice S bar, but it was still a little bit muted along with Thursday compared to our breakout bar on Wednesday. Plus volume, the great validator, seems to be going less and less. This gives us less confidence rather than more confidence on a new bull trend forming. Let’s take a look at a five-minute chart. Our five-minute chart for Thursday and Friday simply shows sideways choppy price action. The Dow Jones Industrial Average closed at $25,316.53. Our low shows $25,165.70, so we’re going to take a note here that says, “Closed above resistance.” Until we get a complete open-high-low-close bar above that resistance line, we’re not going to adjust our support and resistance price thresholds. Everything else remains the same. We’re keeping a neutral / bullish trading bias.

Moving on to the NASDAQ, looking at a weekly bar chart with two years worth of data, we can see that on the technology stocks, we have a bull trend more clearly forming. The volume this past week was very strong. Switching back to a six-month daily chart, we can see that the NASDAQ faltered on Thursday but seems to have regained its feet on Friday. All of our simple moving averages are oriented correctly and trending correctly for a bull trend. The volume is perhaps telling us a different picture, again having us question whether that bull trend has been really established. We need to let this pattern mature past this next phase of range contraction. If we see the second cycle of bull movement, we’ll know the bull trend is back. Taking a look at our five-minute chart, this past Friday was again a choppy day for the NASDAQ with it closing up on its daily highs. The NASDAQ closed at $7,645.51. Everything else in our notes stays the same, our trading bias remains at bullish. We’re in a moment of range contraction on the NASDAQ.

Taking a look at the S&P 500 Index, the index that most represents our watch list, starting with a weekly, two-year chart. Again an up week on strong volume hinting that a new bull trend is getting established. Switching to our six-month chart with daily bars, you can see our 30, 50, 200-day simple moving averages trending up, our seven-day simple moving average is trending up, and they’re all oriented correctly to establish a bull trend. It looks like Friday’s price action counteracted Thursday’s price action, but again, volume validation is betraying the uptrend. Going to a five-minute chart we can see, similar to Thursday’s choppy sideways action, Friday was choppy as well until early afternoon when perhaps a bull trend established. Price is still bumping up against resistance. We closed at $2,779.03. Our low was $2,763.59. We’re going to take a note here as well saying, “Closed above resistance.” 

Our New York Stock Exchange Composite Index, starting out with a weekly, two-year chart, shows a consolidation of our simple moving averages. This particular index shows a converging channel, which usually leads to something big happening in the future as the pressure builds within this exchange. Let’s move back to our six-month, daily chart where again I can see the consolidation of all of our simple moving averages, hinting that a pressure is building up over the last month of converging channel where something has to give. We call this a “butterfly body” in a “butterfly pattern.” After the butterfly body forms, a butterfly wing typically follows, which means some extreme price actions in our future. We’ll keep our trading bias here, at this time, at neutral.

Taking a look at our VIX Volatility Index, starting with a weekly chart with two years worth of bars, we’ll apply a 40-week simple moving average. We can see that the implied volatility is still testing right below that simple moving average but really hasn’t crashed down to the levels that we saw in late 2017. Let’s move to a six-month, daily chart with a 200-day simple moving average. Again, the VIX is holding right at that mean, slightly below, finding nice solitude loitering around that level. Our VIX Volatility Index on Friday was up 0.41% to close at $12.18.

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I have something special and out-of-the-ordinary for you this week. I wanted you to see the insider analysis I sent my Trading Trainer “Learning Community” program participants, on Monday (4 June 2018) evening. It resulted in me earning an easy 13.9% yesterday, Tuesday (5 June 2018) on Akamai Technologies (AKAM) breaking out. It also resulted in me entering into a long position with a stock replacement option strategy for the long term.

I wanted to share this analysis today because it features me looking at price patterns in two different ways. Then I planned out option strategies, pre-selected options and created timing follow through rules.

We’re used to planning out different option strategies on the same recognized pattern. In this analysis, we see that it’s okay to recognize more than one pattern, and how to reconcile these two views.

Basically it shows that it is correct to not just try to “bucket” what you’re seeing in one way. Things in the market are not black and white. Being flexible always wins.

For me to share and inside analysis public ally, there has to be some special insights in it. Please go through this analysis a few times. Watch the video. Read the transcript. Review the images. You will pick up some great insights. Thank you in advance for humoring me.

Hi team. This is A.J. Brown with Trading Trainer on the evening of Monday, June 4, with your Trading Trainer ‘Daily Insights’. What we’re going to do here is take a look at our Trading Trainer ‘Daily Picks’ report generation tool. We’re actually going to create for ourselves a pick list. From this pick list, we’re going to find a candidate, do a full analysis on it, see if it deserves to be on our hot list. If it does, we’re going to craft follow through rules, pick option trading strategies, preselect options, and put together preliminary exits.

Let’s look at our ‘Trend Continuation’ templates. I want to take a look at Chaiken because I found Akamai Technologies. $77.07, up 1.41%. The main thing is its got 85 days of an uptrend. Correlated with my naked chart analysis, it’s inconclusive. We confirmed today so I want to check this out deeper. Let’s go ahead and take a deeper dive here. I also, just for laughs and giggles, will bring up our ‘Pattern Alteration’ template.

Here’s Akamai Technologies. $77.07, up 1.41%. $77.07 is a little bit overpriced compared to the volume-weighted average price (VWAP). Volume was okay. We’ve had good volume so far. Here it is. Four for our Bollinger Band Width Index and 15 for our Candlestick Count, so we’re not quite channeling. We’re not quite converging either. Earnings per share (EPS) is 87. Relative price strength (RPS) is 97. Industry group strength (IGS) is A+. Hover over the ticker symbol, we get a short description of what this company does. “The delivery of content and applications over the internet.” They’re a tech stock.

They’re neutral in the short and the long duration. The subsector is Internet Services, which is bullish in the short and the long duration. The sector is Software and Computer Services, which is bullish in the short and the long duration. The supersector is Technology, which is also the industry, bullish in the short and the long duration.

Let’s pull up a quote. Here’s Akamai Technologies. Here are our price statistics and our company statistics. We have our competitors over here. Related companies. News headlines. Earnings. They beat them, beat them, top, top, top. Let’s do a deeper dive on the description. Here we’ve got our full description. We’ve got our mailing address and our phone number and our fax number, and our webpage, where you’ll find the investor relations link or tab. From there, you click over and they’ll have electronic methods to communicate with folks from the right department in the company.

Let’s do a deeper dive on the officers and board of directors. Here you can see who they are, their age, how long they’ve been with the company, their position, their compensation and option compensation as well. Good biographies. Let’s look at insider trading. I want to pay attention to what these officers and board of directors are buying and selling. They know more about this company than we do. If you see anything out of the ordinary, we want to go back to their address, write them a letter. Go back to their phone number, phone them. Go back to their fax number, fax them. Go back to their website, communicate with them electronically. They do have to answer your questions, especially about insider trading, it is the law. Take a good look at insider trading.

Then we’re going to go to our analysts. We don’t see them piling on a buy or sell, so we’re going to move on. It’s only when the analysts pile on buy and sell that I want to take notice. Now I’m going to go to the news headlines and I’m going to read a little bit deeper. I’m going to read from the most recent, to the farthest back, paying attention to the scoop, the skinny, the gossip, the current events with respect to Akamai. That’s going to give me an advantage. Then I’m going to go to charts.

From the charts, I want to take a look at a five-year, weekly chart. We’ve got a little bit of sideways chop over last years. I’m going to pull up what splits came about. None. Dividends? They don’t give out dividends. This is an asset appreciation play all together. Earnings. Key developments.

Now I’m going to move into a one-month, daily chart. Here I’m going to pay attention to the headlines. I’m going to pay attention to those headlines that accompany price pops and drops. Those type of headlines cycle, and as they do, investors react the same way each time, as if they’ve never seen those headlines before. We want to be in-tune to those particular types of headlines that go along with price pops and drops. That’s also going to be an advantage.

In fact, the only disadvantage to all of this soft data research is if we formed a trading bias, either consciously or more likely subconsciously towards Akamai Technologies, so let’s not do that. Let’s have an awareness. Let’s have an understanding. Let’s build a relationship with Akamai technologies, the company, the stock and the option chain. Not only is that going to give me an advantage, that’s going to give me a leg up against other technical and quantitative analysis traders out there.

With that said, let’s switch gears. Let’s put on our technician’s hat. Let’s plot this thing. I’m going to plot it on a six-month, daily chart with a linear scale, open-high-low-close (OHLC) bars. We’re going to have a separate pane for volume and volume average. We’re going to have a separate pane for the Williams %R. We’re going to have a separate pane for the Chaiken Oscillator . On the main pane, we’re going to have a 200-day simple moving average. Once this chart loads, I’m going to expand it to full screen.

Because of the missing alignment with my naked chart analysis, I’m also going to simultaneously plot this on a three-month, daily chart, linear scale, candlestick bars, Bollinger Bands on the 20-day, and a separate pane for volume and volume average. We call that our breakout template. I’m using my Chaiken template and my breakout template. Once this chart loads, I’m going to expand it to full screen.

Let’s start off with the Chaiken template and let’s start off with a line-on-close and do our best-fit trend line, and since this is Akamai Technologies and we see here in our quote that it’s traded against the NASDAQ, let’s go ahead and on a separate axis, plot COMPX. We want to see if there’s any correlation. When the NASDAQ goes up, does Akamai? When they go down, up, down? Magnitude doesn’t matter. It’s more of direction. I think there’s a good correlation, so let’s go ahead and use the NASDAQ as a reference price index.

In the meantime, the 200-day is running parallel to our best-fit trend line. We’re clearly over the 200-day simple moving average, so that’s a bullish trend. Let’s look at our Willams %R. We went to an extremely oversold and then our Chaiken Oscillator has crossed above its zero, so there is something of a bullish trend going on there. I also see the consolidation, so let’s bring our other template up.

I see the Bollinger Bands are compressing. I see the candlestick count is high. I see the five and the 10-day simple moving averages have caught up with each other. Look at the butterfly patterns. This is the wing leading up to butterfly body. We’re expecting another butterfly body but it’s a little bit immature. I see it here too in the point and figure chart. Currently, our implied volatility is just about right where the historical is, so it’s right priced. I think we’re going to have to set up on this in two different ways, so let’s go back to our Chaiken template and let’s set up on it that way, first.

The last time we set up on this was July 25th last year (2017), so here’s our last Akamai Technologies’ evaluation. Now I want to do this a little bit more formal, so I’m going to set it up very similar to how we set up on Hess recently. We’re going to look for follow through by looking for “Harmony”. We’ll bring our evaluation on Hess up right here. We’ll evaluate Akamai Technologies during professional hour. Akamai has to be greater than the confirming day high, which is $77.09. The NASDAQ has to be greater than its close, $7,606.46. Akamai is forming an S bar. Again, taking a hint from our set up on Hess, which is very formal, we call this needing to see “Harmony”, we look for NASDAQ to trend up, going into and during professional hour on five-minute bars.

We’ve got to preselect an option. Let’s compare August to November. With our August, we would go with the $75 strike price. There is a pretty large bid-ask spread, but I am seeing volume. So $4.90 to $6.05. Then the November. In this case, I might go with the November. A little bit better bid-ask spread, and in addition to that, even though our open interest is a little bit on the lower side, the price isn’t that much more expensive than the August, and it looks like Akamai doesn’t appreciate super fast, so I might be in this for the long term. Why don’t we plan on just going with our November?

So Akamai November 75 call. Let’s actually go with the 77.50. I think that’s going to be our best bet. Remember how low that implied volatility was? Let’s go with the 77.50. Now, at the same time, back to Akamai as a “Pattern Alteration”.

Notice, I’ve got all my setups from the past on all tickers, saved. I think you should too.
If I’m doing my support and resistance lines here, it looks like I’ve got resistance at $77.50, and support at $75. Our middle price is $76.25, times 6/10ths of a percent is 46 cents. Let’s use 46 cents for our Equity Trader Momentum (ETM) threshold. Good.

Let’s see. We’ve got to preselect some options here. Let’s bring back our option chain. The upper threshold, $77.96. The lower threshold, 74.54. We’ll come back here to our June options, which are still good to go. We can use these pretty much all the way up to a week before expiration. I think we’ll use the $77.50 here for our call. We have liquidity. We’ll use our $75 put. We’re not going to need to do a last minute liquidity check. All right.

There we go. Let’s review our plans. Let’s take a look at both of our setups because we looked at this in two different ways and we’re going to set up on it in two different ways.

First, evaluate it during professional hour, if it’s greater than $77.09, which is the confirming day high and the NASDAQ is greater than $7,606.46, which is its previous day close, and Akamai is forming an S bar on its daily bar like it did today, and the NASDAQ is trending up, going into and during professional hour on five minute bars, I’ll open this position. To get me to the end of the day, I’ll put a risk stop on it.

If it breaks out… if it goes above $77.96, or below $74.54, those are the threshold crossings, we’ll need to see smooth and consistent price movement over the previous six five-minute bars, where the previous half-hour high-low range is greater than 46 cents. If not, check back every 30 minutes. In this case, if we get into the trade, we’re going to set a trailing stop-loss exit sell alert, contingent on tracking the lows for a breakout up or tracking the highs for a breakout down, three 30 minute bars back, on the underlying stock. We also talked about perhaps setting an additional percentage based trailing stop and using the most conservative. I think that’s a good plan to lock-in gains for symbols that breakout very quickly.

With that said, if we wanted to take it one step farther and I do recommend that you do, I would suggest for these two setups, which are stock replacement setups, we use some sort of automation. I’m talking about automatic trading and/or automatic alerts. I’m partial to our Trading Trainer ‘Advanced Alerts’ add-on tool. It watches your candidates in real time, which is much more accurate than doing it manually and mechanically. It also watches all of your candidates for you, not just the one. The best part about our ‘Advanced Alerts’ is it is made with our follow through rules built in here. As you can see, you just simply select which ones you want, fill in the blank with the value, and it watches those complex patterns. Not only that, for these candidates that we feature in our ‘Charts of Interest’ videos, we set them up for you in the tool, so you don’t have to do anything besides just trade it. It really becomes a no-brainer.

What do you have to do? You have to set up the trade with your broker. Cue it up. If and when you get the alert, I usually take out my mobile device. It usually buzzes because I set the ‘Advanced Alerts’ to send me a text message. I use my broker app. I open it up and I do my last minute checks. I like to check open range. Sometimes I like to check liquidity. If all is good, I’ll pop the trade. If not, I’ll drop the trade. I’ll put that mobile device right back in my pocket. Three to five minutes go by, maybe 10 at the most, and then I’m back doing whatever. It is a no-brainer. Long gone are those days where we needed to have terminals or servers, or even laptops or desktops wired into the exchanges and watching them in real time. Now it’s a no-brainer. People who trade real money and pay for the ‘Advanced Alerts’ tool say that it pays for itself month in and month out. I’d like to have you please click on support and ask them to provision your Trading Trainer ‘Advanced Alerts’ add-on tool.

With that said, I’d like you to take a look at this pattern. Then take a look at these stock replacement strategies. We always create stock replacement strategies first because they force us to fully analyze and recognize the underlying symbol from every different aspect. Then when we go to our options trading tool chest, to select and populate our stock replacement strategies, we can look for additional strategies above and beyond. I’m going to let you do that on your own. It’s always easier to profit from the same ticker in multiple ways, not just looking at the pattern in different ways like we did here but also with different options strategies, than it is to go find a new symbol to trade on.

Team, that’s all I’ve got. Please take care.

About The Author

A.J. Brown is widely recognized as “the world’s most disciplined option trader.” He has been actively trading equities and options since 1997, and has published daily insights for his Trading Trainer program participants every single night, 5-days a week, since 2002. He is the author of the wildly successful e-book called “The Seven Strategies of Successful Options Traders” and his home study courses and video series can be found in the libraries of the most successful investors and often times referred to by them as their secret weapons. Trading Trainer is based out of Fort Collins, Colorado.

The post Insider analysis on Akamai Technologies (AKAM) appeared first on Trading Trainer.

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Hi there. This is A.J. Brown with Trading Trainer on the evening of Friday, June 1, with your Trading Trainer weekend edition of your “Daily Insights”. What we are going to do here is take a look at the broad market by taking a look at representative indexes of our watch lists, namely the Dow Jones Industrial Average, the NASDAQ Composite Index, and the S&P 500 Index. We are also going to take a look at the New York Stock Exchange Composite Index and the VIX Volatility Index, and because it is the weekend, we are going to take a look at both daily and weekly charts. Before looking at any charts, we’re actually going to log into the Trading Trainer “Learning Community” web portal by going to login.tradingtrainer.com. Of course, once we’ve logged into the “Learning Community” web portal, I’m going to direct you right to today’s “Daily Insights” tab, and further to the “Recommendations” sub-tab.

Take a look at the recommendations we have for Monday, June 4’s trading session. Slight changes in these recommendations could have a major impact on your trading. You are also going to find here a link to our audio commentary. This is the audio where I take you by the hand through today’s “Daily Insights” tab and it’s sub-tabs. Go ahead and click on that link. An audio is going to start playing automagically in the background in another browser tab or another browser window, depending on how you have your browser configured. Go ahead and listen to that audio the first time you do click through today’s “Daily Insights” tab and its sub-tabs, it will make sure you hit all the high points. You can always drill down deeper on your own after the audio is over. When you listen to the audio commentary, please pay special close attention to the opening and closing comments.

In the meantime, for this particular “Broad Market Analysis” of this “Charts of Interest” video series, let’s click on the “Daily Insights” tab and the “Index Stats” sub-tab. Team, our trading bias remains neutral. Our industrials shown by the Dow Jones Industrial Average gained 0.9% today on light, above average New York Stock Exchange volume, and fell 0.48% for this past week on heavy, above average New York Stock Exchange weekly volume. Our technology stocks shown by the NASDAQ Composite Index gained 1.51% today on light, above average NASDAQ exchange volume and for this past week, gained 1.62% on heavy, above average NASDAQ exchange weekly volume. Our large caps shown by the S&P 500 Index gained 1.08% today and gained 0.49% for this past week.

Moving on to our secondary indexes. Our 100 best stocks out there, shown by the S&P 100, gained 1.1% today and gained 0.63% for this past week. Our mid-caps, shown by the S&P 400, gained 0.61% today and 0.59% for this past week. Our small caps, shown by the S&P 600 and the Russell 2000, two different perspectives on small caps, gained 0.8% and 0.88% respectively for today and gained 1.09% and 1.29% respectively for this past week. Our New York Stock Exchange Composite Index gained 0.75% today and fell 0.11% for this past week. Our VIX Volatility Index fell 12.77% today and gained 1.82% for this past week to close at 13.46. Our Gold ETF fell 0.5% today and 0.58% for this past week. Our Oil ETF fell 2.21% today and 3.14% for this past week.

Team, let’s take a look at our economic calendar by clicking on our “Daily Insights” tab and our “Economic Calendar” sub-tab. The first thing I’d like you to do is read today’s “Market Reflection” summary. After reading today’s “Market Reflection” summary, fast forward to Monday, June 4 and read the “Market Focus” pointers. Also, on Monday, June 4, you will find two reports, namely the “International Perspective” report and the “Simply Economics” reports. Please read through these reports. These reports summarize what happened the previous week in the economic news front, as well as what to expect for the week to come. These are must-reads over the weekend.

Returning back to Friday, June 1, Motor Vehicle Sales were released. For April, total vehicle sales were 17.2 million. Domestic vehicle sales were 13.2 million. For May, that number dropped a little bit with total vehicle sales coming in at 16.9 million and domestic vehicle sales coming in at 13 million. Although a little drop, still robust.

Our Employment Situation was released. In April, our non-farm payrolls month over month change were 164,000. We revise that April number this time around to be 159,000. Our May number, 223,000. The unemployment rate in April was 3.9%. In May, we’re reporting 3.8%. Our participation rate in April was 62.8%. In May, it actually seems to have gone down to 62.7%. Average hourly earnings month over month, in April we reported an increase by a tenth of a percent. In May, we’re seeing a three-tenths percent increase. When you look at the average hourly earnings year over year change, in April, we were reporting 2.6%. In May, 2.7%. This is enough impetus for the Federal Open Market Committee (FOMC) to want to raise interest rates to control this wage inflation. The average workweek for employees in April was 34.5 hours. That’s what we report in May, 34.5 hours.

The PMI Manufacturing Index in April was 56.5. In May, we’re reporting 56.4.

The Institute of Supply Management’s Manufacturing Index in April came in at 57.3, and in May, 58.7.

Construction Spending, in March, the month over month change was down 1.7%. In April, it was up 1.8%. Year over year, in March, construction spending was up 3.6%. In April, we’re reporting 7.6% increase.

Looking to next week, Monday we have Factory Orders; Tuesday, we have our services indexes, as well as our Job Opening and Labor Turnover Survey (JOLTS) report; Wednesday, Thursday, we have some more economic news that people will be looking at; Friday, it kind of calms down. Let’s move on.

Let’s take a look at our “Trading Tools” tab and our “Watch Lists” sub-tab. We have quite a few tickers identified by our Options Trading Candidate filter. The ones that are not highlighted in yellow are already on our list, they are simply reaffirming their position there. The ones highlighted in yellow are new to us and we will evaluate these additionally for liquidity and patterns before adding them permanently to our list.

Let’s go to our “Trading Tools” tab and our “Daily Picks” sub-tab. Here you will find our Trading Trainer “Daily Picks” report generation tool. I’m going to do a deeper dive on our indexes by looking at volume and trends. It seems our volume dropped considerably today compared to yesterday but is just about right at the 50-day simple moving average, the NASDAQ a little bit higher, also right at the 200-day simple moving average, again the NASDAQ is a little bit higher. The oscillator shows we’ve had some healthy volume. Our short duration trends are mixed. Some are up, some are down, some are neutral. The long duration trends are all coming in marked as neutral.

Taking a look at our template algorithm filters, these mathematically go through whatever raw data we present them with looking for patterns in the numbers. We’re going to present these templates with the raw data of our index tickers. That’s going to give us an idea what the broad market personality is doing, as well as what to look for in our watch lists. Our trend continuation trio of templates, the Reactive, Buffered, and Chaiken, are all coming in neutral. Our Short-Term Trend template is for the most part showing neutral. Same with our Trend Reversal template. Our Pattern Alteration template is showing the Bollinger Band Width indexes still on the wider side with threes, fours, and fives. Our bar counter, this is the Candlestick Bar Count, is getting up there in size into the double digits, in some cases even bigger. This is telling me that we are sideways channeling in a neutral channel, and perhaps even seeing some consolidation and converging.

Let’s go to our “Trading Tools” tab and our “Charting” sub-tab. I’m going to start with my Quick Review template. This is a six month, daily chart with a linear scale and open-high-low-close (OHLC) bars. We have a separate pane for volume and volume average. To this, we like to add our 30, 50, and 200-day simple moving averages. These lagging indicators help me determine the trend. I have these simple moving averages added to the Quick Review template here in a user-defined template in my personal profile. I’m going to apply that user-defined template to the indexes, specifically starting out with the Dow Jones Industrial Average.

We’ll begin by going to a weekly, two-year chart. We had a Doji week that was actually an upside-down Lincoln’s hat, meaning the Bears put on some pressure, but the Bulls rebounded bringing price to where we started. Volume was moderate. Our weekly polarity shows a higher high and so far a higher low; a bullish weekly polarity. Switching to a six-month, daily chart, our 200-day simple moving average trends up. Our 50-day simple moving average is flat, and so is our 30-day simple moving average. Our seven-day simple moving average is trending down and has caught up with price. Our volume was moderate. Taking a look at today’s five-minute chart, price hardly moved after gapping up, just went sideways. Back to our daily chart. Let’s take a look at our notes. We closed at $24,635.21. We have a lower low, but a higher high, so we’re testing Bear. Doesn’t look like any of our note parameters change.

Let’s move onto the NASDAQ. Let’s go to a weekly chart with two years of data. We have a bullish weekly polarity, and we had a bullish week in the technology stocks. Our volume for the week, however, was low. Let’s switch to a six-month, daily bar chart. Today was an up day on moderate volume. The 50-day simple moving average is flat. The 30-day simple moving average is bullish. The seven-day simple moving average is bullish. The 200-day simple moving average is bullish. Our daily polarity is bullish. Let’s look at the five-minute intraday chart for the NASDAQ Composite. Here we see also a gap-up at open, but then continued price increase until early afternoon, and then a sideways stall. Back to our daily chart. We closed at $7,554.33. Our low was $7,487.23. We’ll take a note that says we closed above resistance. We will not adjust support and resistance levels until we have a complete open-high-low-close (OHLC) bar outside of our horizontal channel. It looks as though everything else in our parameters remain the same.

Let’s move onto the S&P 500 Index. We will start with a weekly chart looking at two years worth of data. We see that we’ve got now a higher high after a higher low. This week, we had the Bears test price, but the Bulls won out in the end, actually closing the S&P 500 higher for the week than where we opened. Volume this week was on the lower side. Let’s move to our six-month chart with daily bars and see that our 200-day simple moving average is trending up. Our 50-day simple moving average is flat. Our 30-day simple moving average is flat. Volume today was on the low side. Our seven-day simple moving average is flat. Today’s price action was up, giving us a testing bull daily polarity… maybe no. Maybe we’re still testing bear. We need to get our price to be a little bit higher, higher than the high from May 22. Let’s look at our five-minute intraday chart. Our price action shows gapping on open and an appreciation throughout the morning all the way into the early afternoon, and then a tight sideways channel stall. Back to our daily chart. We closed at $2,734.62. It looks as though all of our other parameters stays the same. Actually, we will update our 30 day simple moving average. Instead of saying it is an uptrend, we will say it is flat.

Our New York Stock Exchange Composite Index starting with a weekly chart looking at two years worth of data, we can see that our polarity remains bullish. We also see the consolidation of our simple moving averages on the weekly chart. We’ll switch to a six-month chart populated by daily bars. Again, we see that consolidation of the simple moving averages. We see our testing bear daily polarity. We see the seven thinking about crossing down below the 30-day simple moving average. We see our 200 trending up. We’re going to keep our trading bias at neutral.

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About The Author

A.J. Brown is widely recognized as “the world’s most disciplined option trader.” He has been actively trading equities and options since 1997, and has published daily insights for his Trading Trainer program participants every single night, 5-days a week, since 2002. He is the author of the wildly successful e-book called “The Seven Strategies of Successful Options Traders” and his home study courses and video series can be found in the libraries of the most successful investors and often times referred to by them as their secret weapons. Trading Trainer is based out of Fort Collins, Colorado.

The post How big of an account do you need to trade options? appeared first on Trading Trainer.

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Hi there. This is A.J. Brown with Trading Trainer, on the evening of Friday, May 25 with your Trading Trainer weekend and holiday edition of your ‘Daily Insights’. What we’re going to do here is take a look at the broad market by taking a look at representative indexes of our watch list, namely the Dow Jones Industrial Average, the NASDAQ Composite Index and the S&P 500 Index. We’re also going to take a look at the New York Stock Exchange Composite Index and the VIX Volatility Index. And, because it is the weekend holiday edition, we’re going to look at both daily and weekly charts.

But, before looking at any charts, we’re actually going to login to the Trading Trainer ‘Learning Community’ web portal by going to login.tradingtrainer.com. And, of course, once we’ve logged into the ‘Learning Community’ web portal, I’m going to direct you right to today’s ‘Daily Insights’ tab. And further to the ‘Recommendations’ sub-tab. Please take a look at the recommendations we have for Tuesday, May 29’s trading session. Slight changes in these recommendations could have major impact on your trading. You’re also going to find here a link to our audio commentary. This is the audio where I take you by the hand through today’s ‘Daily Insights’ and its sub-tabs. Go ahead and click on that link. An audio is going to start playing automagically in the background in another browser tab or another browser window depending on how you have your browser configured. Go ahead and listen to that audio the first time you do click through today’s ‘Daily Insights’ tab and its sub-tabs. It will make sure you hit all the high points. You can always drill down deeper on your own after the audio is over. When you listen to the audio commentary, please pay special close attention to the opening and closing comments. In the meantime, for this particular ‘Broad Market Analysis’ of this ‘Charts of Interest’ video series, let’s go right to our ‘Index Stats’ sub-tab under the ‘Daily Insights’ tab.

Team, our trading bias remains neutral. Our industrials shown by the Dow Jones Industrial Average fell 0.24% today, on light, below average New York Stock Exchange daily volume and gained 0.15% for this past week on light, below average New York Stock Exchange weekly volume. Our technology stocks shown by the NASDAQ Composite Index gained 0.13% today on light, below average NASDAQ Exchange daily volume and gained 1.08% for this past week on light, below average NASDAQ Exchange weekly volume. Our large caps, shown by the S&P 500 Index, fell 0.24% today and gained 0.31% for this past week.

Moving on to our secondary indexes, our 100 best stocks out there shown by the S&P 100 fell 0.26% today and gained 0.33% for this past week. Our mid-caps, shown by the S&P 400 Index, fell 0.24% today and gained 0.18% for this past week. Our small caps shown by the S&P 600 and Russell 2000, two different perspectives on small caps, edged down 0.05% and 0.08% respectively for today and gained 0.21% and edged up 0.02% respectively for this past week. Our New York Stock Exchange Composite Index fell 0.49% today and fell 0.65% for this past week. Our VIX Volatility Index gained 5.51% today and fell 1.49% for this past week. Our Gold ETF fell 0.31% today and gained 0.65% for this past week. And our Oil ETF fell 4.27% today and fell 5.2% for this past week.

Let’s take a look at our economic calendar, by going to our ‘Daily Insights’ tab and our ‘Economic Calendar’ sub-tab. First thing I’d like us to do is to take a look at today’s ‘Market Reflections’ summary. Then I’d like to take a look at Tuesday’s ‘Market Focus’ pointers. Also, you’ll notice on Monday, May 28 which is a holiday here in the United States, the ‘International Perspective’ report as well as on today, Friday, May 25, the ‘Simply Economics’ report. These two reports are must-reads for this holiday weekend edition. These two reports summarize well the economic news over the past week and what to expects for the week to come. Please read these two reports.

Durable goods orders were released today. New orders for March were at 2.6%. This time around we revised that March number to 2.7%, and we released our April number of a 1.7% decline. Now when we factor out the volatile transportation sector, in March we reported flat. We revised that flat number to be up 0.4% and our April numbers came in at a 0.9% increase. Finally, our core capital goods in March had declined by 0.1%. We revised that number to be an even bigger decline of 0.9%. For April they actually increased by 1%.

And, Consumer Sentiment was released today. The Sentiment index level for mid-May was 98.8, for the final, end of May, we’re reporting 98, a slight decline.

Remember that Monday is a US holiday, the markets will be closed. Tuesday we’ll start seeing some economic news and actually, the whole next week is economic news-rich. Let’s move on.

Let’s go to our ‘Trading Tools’ tab and our ‘Watch Lists’ sub-tab. We had three tickers identified by our options trading candidate filter today. One of them is already on our list, it’s not highlighted in yellow. The two that are highlighted in yellow are new to us. We will evaluate those for liquidity and patterns before adding them permanently to our list.

Take a look at our ‘Trading Tools’ tab and our ‘Daily Picks’ sub-tab. Here you’ll find our Trader Training ‘Daily Picks’ report generation tool. We’re going to do a deeper dive on our indexes by looking at volume and trends. The NASDAQ volume is very much lower. The Dow is about the same, slightly lower, across the board. Short duration trends are bullish, long duration trends are neutral.

Backing this up, taking our template algorithm filters, these mathematically go through whatever raw data they are presented with, looking for patterns in the numbers. We’re going to present them with the raw data of the index tickers. That’s going to give us an idea what the broad market personality is doing, as well as what to look for in our watch lists.

Our ‘Reactive’. ‘Buffered’ and ‘Chaiken’ are very much neutral. Our ‘Trend Reversal’ template is showing bullishness but our ‘Short Term Trend’ template is showing no trends, so we’re in a state of range contraction. Our ‘Candlestick Bar Count’ is in the double digits. Our Bollinger Band Width index is five, sixes, sevens and eights. We’re sideways channeling.

Taking a look at our charts by going to the ‘Trading Tools’ tab and our ‘Charting sub tab, starting with our ‘Quick Review’ template, which is a six month, daily chart with a linear scale and open-high-low-close bars with a separate pane for volume and volume average. And, to that, I like to add my 30, 50 and 200-day simple moving averages. These lagging indicators help me determine the trend. I have these simple moving averages added to the ‘Quick Review’ template here in a user-defined template in my personal profile. I’m going to go ahead and apply these to the indexes. Specifically starting out with the Dow Jones Industrial Average.

We will start with a weekly, two-year chart. Price hardly changed this week, neither did volume. We do have a higher high following after a higher low, so our trading polarity does remain bullish. Six month, daily chart, we have our 30-day pointing up, we have our 50-day going sideways, we have our 200-day pointing up, we have our seven-day flattening out. With our polarity, you can see a higher high, but then a lower low, so we’re testing bull. Let’s take a look at our five-minute chart. We have very little price action with regard today’s trading. Perhaps investors already left for the holiday weekend. We closed at $24,753.09 and everything else remains the same, including our neutral trading bias.

Moving on to the NASDAQ Exchange, taking a look at our weekly, two-year chart. For the week, very little price action, higher high following higher low. Going to our six month, daily chart, the seven is up, 30 is up, 50 is still flat, 200 is up. We closed at $7,433.85. So far everything is remaining the same. Looking at the five-minute chart, today was very little price action, again may be attributed to investors checking out early. Trading bias is neutral.

Taking a look at the S&P 500 Index, the index I feel most represents our watch list. Starting with a weekly, two-year chart. Again we can see a higher high after a higher low, so our trading polarity is bullish, the volume is incredibly low, price action didn’t really even occur. Switching back a six month, daily chart, price action here, of course, is also somewhat stalled. But when it comes down to it our previous high of $2,732.86 compared to our recent high of $2,742.24 means a higher high, followed by a higher low, so our polarity here is still bullish. Our 30 is up, our 50 is flat, our 200 is up, our seven is up, and the seven caught up with the price. Volume today was very low. We closed at $2,721.33. Everything else seems to be remaining the same. Today’s intraday price action hardly moved at all. Trading bias is neutral.

The New York Stock Exchange Composite Index is also going sideways. Starting with our weekly, two-year chart. Price action this week actually dipped a slight amount, still, our polarity is bullish. Switching to a six month, daily chart. The consolidation of the seven, 30, 50 and 200 is really uncanny, hinting that there’s pressure building in the market leading to some sort of break. We’re going to keep our neutral trading bias right now.

Moving onto the VIX Volatility Index, looking at the weekly, two-year chart with the 40-week simple moving average. You can see that the implied volatility is right at the simple moving average, which has been pulled up off of its low in February. Back to a six month, daily chart with a 200-day simple moving average, and again, you can see the implied volatility is right at the simple moving average. Today we were up 5.51% bringing us to $13.22.

Our overall trading bias is neutral.

Our broad market personality is sideways channeling, testing horizontal resistance.

Our market is responding the following including but not limited to: transient external stochastic shocks, US Fiscal Policy, US Federal Reserve monetary policy, the monetary policies of China, Europe and Japan, the price of oil, US economic news including employment, housing, manufacturing and retail, and of course, any market news including mergers and acquisitions, initial public offerings, public companies going private, and earnings.

Team, enjoy your three days holiday weekend, please take care.

Comment below to contact me with ANY option questions YOU have.

About The Author

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How to Create a Stable 7 Figure Income Selling Option Premium Like A Trading Pro
A.J. Brown, Trading Trainer

Join trading veteran A.J. Brown for this exciting presentation, where he will:

  • Explain the 3 simple steps to a 7 figure income
  • Compare covered call writing to writing calls against leaps
  • Show you how to find underlying stock, index, and ETF candidates best suited for this trading strategy
  • Demonstrate how to pick the optimal option for the bought LEAPS and sold calls
  • Detail how to limit downside risk with a long put and how to pick the optimal strike prices and expirations.

When you’re done with this presentation, click here to visit our FREE video training.

About The Presenter

A.J. Brown is widely recognized as “the world’s most disciplined option trader.” He has been actively trading options for more than 18 years, and has published daily insights for his Trading Trainer program participants every single night, 5 days a week, since 2002.

The post Toast to Traders: How to Create a Stable 7 Figure Income Selling Option Premium Like A Trading Pro appeared first on Trading Trainer.

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Equity options. Index options. Options against Exchange Traded Funds (ETFs). They come in two varieties; Calls and Puts.

Buy a call and you have the right to buy the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying will go up. Sell a call and you have the obligation to sell the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying is not going to change.

Buy a put and you have the right to sell the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying will go down. Sell a put and you have the obligation to buy the underlying security for the option strike price at or before the expiration date. You would do this if you think the price of the underlying is not going to change.

The option price itself changes based on 1) the underlying security price change compared to its strike price, 2) the amount of time left before it expires, and 3) the change in the supply and demand for the option contracts in the market. The ironic thing is, most investors and traders alike simply buy and sell the option contracts, never translating them to underlying security transactions.

In my last article I laid out some key option trading concepts.

Ideas you need to master if you want to succeed.

Today I want to continue your stock option education.

I’ve recorded a short video to answer the question…

“What Is An Option?”

How do they work?

What are the core concepts you need to grasp?

AND – how can we use those foundations to start making money?

Your first response might be to skip this stuff.

Maybe you think you already know everything you need to know. The truth is, you probably know just enough to be dangerous – not enough to profit in the long run. And, you probably have opened yourself up to heck loads of risk you may not even be aware of.

The good news…

We can fix that really quickly.

We can give you a master level understanding of the option markets.

It starts with this video…

Check it out – then contact me with ANY option questions YOU have.

About The Author

A.J. Brown is widely recognized as “the world’s most disciplined option trader.” He has been actively trading equities and options since 1997, and has published daily insights for his Trading Trainer program participants every single night, 5-days a week, since 2002. He is the author of the wildly successful e-book called “The Seven Strategies of Successful Options Traders” and his home study courses and video series can be found in the libraries of the most successful investors and often times referred to by them as their secret weapons. Trading Trainer is based out of Fort Collins, Colorado.

The post What are these option things anyway? How do I make them benefit me? appeared first on Trading Trainer.

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