By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
There’s only one resolution traders need in the new year: Make twice the profit you made in 2015 by Dec. 31, 2016.
And this signal is the secret to reaching that goal – it’s the absolute best momentum indicator you can have in your trader’s toolbox.
It’ll help kick your options trades into high gear in 2016, so let’s get started…
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
Timing is everything, especially in options trading.
When you're trying to get into a trade, a few minutes can be the difference between getting in at the price you want and your targeted options getting away from you completely.
And when you're already in a trade, those same few minutes can also be the difference between banking 100% profits and watching your options reverse course and turn against you.
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
You can use a stock’s support and resistance levels to identify channels and better predict how a stock’s price will behave.
For example, horizontal channels mean a stock is trending sideways.
But channels can also trend up or down, and learning to spot them will help you identify potentially profitable options trades.
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
We've talked before about the importance of support and resistance when looking at a stock chart. They come up a lot during the normal course of options trading.
They're incredibly important indicators of where a stock price might (or might not) be headed.
Today, we're going to take a look at another way you can use support and resistance to identify potentially profitable options trades.
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
When trading options, there are several factors that affect price – not just the value of the underlying asset.
The variables that exist that account for the fluctuations of an option's price movement are known as the options "Greeks," and we've covered many of these.
I've told you that delta – how an option's price will move with price movements in the underlying – is the single most important factor in determining an option's price.
Today's "Greek" shares a special relationship with the delta. I like to call it the "delta accelerator."
Here's what I'm talking about...
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
Volatility has a huge impact on options pricing, and you need to understand the mechanics of how that happens and what it means for your money.
This options trading lesson is crucial – you'll learn how to find stocks with a chance to make big moves… and how to identify potentially lucrative options plays to profit on those moves.
We're going to explore in detail the "Greek" that measures changes of an option's value based on how much the implied volatility on the underlying security changes.
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
There's one eensy number that every pro trader checks out when they're doing their "homework" before picking a trade.
They clean up on those trades, and now, so will you…
You see, we know that the options on the stocks that have a $0.05 or less bid/ask spread, like you find on the CBOE Penny Pilot list, give you the best chance at making the most money on the smallest price moves.
And we know that picking an option with the lowest "percent to double" gives you an easy shot at doubling your money when you want that to happen.
But now I want to show you how to use one number to pick the options that will move in your favor when the stock you're trading moves in price before you enter the trade.
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
What's the true measure of a trader's success?
Last Tuesday, I told you that two of the most important things you can do as a trader is to build a plan for every trader, and to stick with that plan through the end of the trade.
But before you can build an effective options trading plan, there are three rules you need to consider.
Let me show you what I'm talking about...
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
There is an old adage that traders are told to live by that goes, "Plan your trade and trade your plan."
There should be a follow-up to that one that says, "Stick to your plan no matter what."
Beginning and experienced traders alike seem to get something in their heads that makes them change their original trading plan.
That's one of the worst mistakes a trader can make. Here's why...
By Tom Gentile, America's No. 1 Pattern Trader, Money Morning • @powerproftrades - • Print | Email
The mindset of short-term options trader is to get in, get out, and turn profits quickly – typically, the more efficiently you can use your capital, the better.
But for those from a long-term, buy-and-hold background, this short-term, options-based way of generating income can be a lot to take in.
So today, I'm going to show you a long-term options trading strategy sure to boost your portfolio...
