Think or Swim Internals Chart Market Internals can be used to give you an overall feel of the market direction. The market internals are similar to a compass or the instrument panel on your car. The internals can give you a sense of the speed and direction of the market. The internals can give you the overall strength or weakness in … [Read more...] about How Market Internals Can Help You Read the Market
There are two words often used to describe a successful trader; consistency and self-control. A successful trader makes consistent profits. What exactly are the components of a successful trader? Using the equity curve as a measure of success, often those less experienced traders will see their equity curve go up and down, but mostly … [Read more...] about Successful Trading; Two Key Elements to Help you Reach your Goals
Do you procrastinate when making a decision to enter a trade? Do you get frustrated when you have made a decision, and the choice you made looks as though it may turn against your positon? When you exit a trade, do you beat yourself up because you could have made more money if you had stayed it the trade? Do you get angry because you … [Read more...] about How to Master Procrastination in Your Trading Decisions Quickly
"Tell me and I forget. Teach me and I remember. Involve me and I learn." Benjamin Franklin Have you ever been assigned in options trading? Many traders have gone through assignment at some point in their career. This article is meant to be a refresher on the "ins and outs" of option assignment. Before getting into specifics … [Read more...] about Assignment in Options Trading – The Long (and Short) of It
In last week's article, I wrote about the long straddle in options trading, and how some traders incorporate the strategy into their trade plan. I will now cover the long strangle, another option strategy that features the use of options in unison with each other. What is a Strangle? Conceptually, the long strangle is identical to … [Read more...] about Straddles & Strangles – Part II
Many traders use straddles and strangles in their options trading plan. This week's article is intended to be a synopsis of the straddle strategy, and potential uses a trader may consider. The strangle strategy will be covered next week. What is a Straddle? A straddle is an options strategy composed of a long (or short) call, and a long … [Read more...] about Straddles & Strangles – Part 1
I've used Interactive Brokers for many years. I still prefer the Classic Trader Work Station (TWS) probably because I've used it for over 10 years. A friend of mine was telling me that he was making order entry mistakes of occasionally buying when he wanted to sell or selling when he wanted to buy. I used to have this problem too until I … [Read more...] about Interactive Brokers Order Management
When faced with danger, fear is a normal emotional response. When fear is present, it is normal human behavior to be primed for flight or fight: running away from the source of the danger, or stand up to it and face it. Sometimes, however, the dangers we face are not real sources of threat, but ones that we interpret as threats in our … [Read more...] about What Do You Do When Fear Takes Over?
You've followed all the proper guidelines before pulling the trigger on a particular trade. You've watched carefully for signals that have worked for you in previous trades. You've waited for the price and volatilities to come to you. You've waited for the right number of days until expiration before entering. You've done all the things … [Read more...] about Stay or Go – When is it time to exit rather than adjust a trade?
Two stocks with options which are about the same price are not always equal. Volatility is one of the reasons two stocks with a similar underlying price may actually have very different values for their options. Volatility can be a useful tool to determine which underlying you would like to trade. The level of volatility can also help … [Read more...] about How Volatility Can Affect Option Pricing of Two Similarly Priced Underlyings