Special Topic Option Strategies: Intra Day Trading Brian Houston, - - PowerPoint PPT Presentation

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Special Topic Option Strategies: Intra Day Trading Brian Houston, - - PowerPoint PPT Presentation

Special Topic Option Strategies: Intra Day Trading Brian Houston, Nison Cer0fied Trainer www.mycandlecharts.com www.candlecharts.com www.candlechartsacademy.com Risk Disclosure: The risk of loss trading securi0es, futures,


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Special Topic Option Strategies: Intra Day Trading

Brian Houston, Nison Cer0fied Trainer™

www.mycandlecharts.com www.candlecharts.com www.candlechartsacademy.com

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Risk Disclosure: The risk of loss trading securi0es, futures, forex, and op0ons can be substan0al and is not for every investor. Individuals must consider all relevant risk factors including their own personal financial situa0on before trading. An investor could poten0ally lose all or more than the ini0al investment. Risk capital is money

that can be lost without jeopardizing ones’ financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indica0ve of future results. We make no profitability nor performance claims of any kind; all informa0on is published for educa0onal use only. Disclaimer: All informa0on provided herein is published for educa0onal purposes only and should not be construed as investment advice. No profitability nor performance claims of any kind are being made. Trading is a high-risk, specula0ve ac0vity. We are not an investment advisor, financial planner nor registered broker. We are a publisher of educa0onal content. Consult with a registered investment advisor prior to making trading and/or investment decisions. By accessing this site and its products/services you agree to all terms of our Disclaimer . No offer to buy nor sell any instrument is being made on this site. You hereby grant this site a royalty-free, perpetual, worldwide license to display, modify, adapt, create deriva0ve works from, and otherwise use any sugges0ons, ideas, comment posts and informa0on that you provide to this site. None of our content on any site nor courses nor other publica0ons is a promise or guarantee of specific results or future earnings; we do not offer any financial investment nor trading advice of any kind; we publish educa0onal content. We do not purport to tell or suggest which securi0es nor currencies customers should buy or sell for themselves. Our owners, employees, subcontractors, colleagues and/or affiliates may hold posi0ons in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in

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Claims contained within tes0monials have not been verified. Tes0monials, case studies and success stories are individual experiences by persons who have used our services. Although these are accepted from site visitors and customers in good faith, we have not independently examined the trading records of any customers and therefore have not verified any specific figures or results quoted

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  • involved. Trading involves a substan0al degree of risk and may not be suitable for all investors. Past performance is not necessarily indica0ve of future results. Commodity Futures Trading Commission

(CFTC) Rule 4.41 HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. The informa0on, services, products, claims, and materials on our sites are provided “as is” and without warran0es of any kind, either expressed or implied. We disclaim all warran0es, expressed or implied, related to strategies and content provided on this site as well as those that are presented in our products and services. All courses, videos and services are licensed for individual noncommercial private use only and may not be resold nor redistributed in any manner. All sales are final and no refunds are offered. Every visitor to this site, and subscriber (or prospec0ve subscriber or customer) acknowledges and accepts the limita0ons of the services provided, and agrees, as a condi0on precedent to his/her/its access to our sites, to release and hold harmless Candlecharts.com, Candlechartsacademy.com and Mycandlecharts.com, its officers, directors, owners, employees and agents from any and all liability of any kind (including but not limited to his/her viewing and/or implementa0on of this sites’ content, emails, webinars, videos, subscrip0on to services and/or purchase of any trader training product or service herein). We encourage all traders to learn to trade in a simulated trading environment using a demo account only, where no risk may be incurred and to not risk live capital.

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Brian has been trading stocks for over 37 years, and has devoted much of his trading career to trading

  • ptions and creating options strategies.

During that time, he has used Steve Nison's candlestick patterns and education to continually improve his knowledge and skills. Recently, Brian has has also added Elliott Wave theory to his set of trading tools, CFDs in Forex, Indices and Gold.

Brian Houston,

Nison Cer0fied Trainer ™

www.mycandlecharts.com www.candlecharts.com www.candlechartsacademy.com

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Which M Markets

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Yo Your Favourite Market

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TRA

RADER ER’S SLA LANG

  • Bull Market
  • Bear Market
  • Support
  • Resistance
  • Trend

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TRA

RADER ER’S SLA LANG

  • Windows – both rising and falling
  • Lagging Indicators!
  • Oscillator – MACD, Stochas0cs
  • Moving Averages
  • Candles and their colours

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SLIDE 8

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Leverage

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The Mul1plier Effect

Where a Nison candle signal confirms another indicator

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Options – Intra Day Trading

  • So what do we do and why?
  • What is your market move expecta0on?
  • 3 Strategies –
  • In the Money
  • At the Money
  • Out of the Money
  • Do you see trends in the market?
  • What are the candles sugges0ng?

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Options – Intra Day Trading

  • Must have a market that has adequate volume
  • Specifically Op0on Open Interest
  • Tight margin spread is best
  • A market that moves and has some vola0lity
  • Has nice poten0al technical signalled moves
  • PICK your 0me period!

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Bulli Bullish sh Engu Engulfing P ing Patt atter ern at Su n at Suppor pport t

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Ho How N NOT t T to u

  • use candles

se candlestic ticks s

Oh my goodness! The market rallied after the shooting star!

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Ho How N NOT t T to u

  • use candles

se candlestic ticks s

  • Long PUTS for

downward market

  • Look for Support
  • Force of candles
  • Risk vs Reward

What should we do here?

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Intra Day Charts – 60 Minute

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Intra Day Charts – 30 Minute

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Intra Day Charts – 15 Minute

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Intra Day Charts – 5 Minute

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Intra Day Charts – 1 Minute

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Intra Day Trading - Setup

  • You must have Major Support and Resistance lines prior to

trading!

  • Major S & R equates to at least Day and 4 hourly observa0on
  • Check on Hourly chart, but rare that I add more lines here
  • Add in an Oscillator that supports your style
  • I use Stochas0cs
  • Know your Candle Pajerns well (NCS)
  • Consider Target Areas for Profit

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Intra Day Trading - Setup

  • Beware of extreme vola1lity in your market and consider

taking the day off!

  • Check and monitor your IV or Vola0lity Indicator
  • Your Bid / Ask spread is a great way to gauge Vola0lity
  • Open Interest
  • How much movement are you needing for your profit target?
  • This determines partly which op0ons you buy
  • Which day or week expira0on do you buy

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Time Premium Decay!

  • It’s called Theta
  • Rough idea how much your op0on

will decay per day (of course it changes)

  • Weekends included!
  • $0.31 per day for at the money
  • p0ons with 2 weeks to expiry!

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Delta!

  • Rough idea how much your op0on

will move rela0ve to a $1 market move (of course it changes)

  • $0.43 per $1.00 move of the

underlying with 2 weeks to expiry!

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Chart Setup

  • Moving Averages required
  • 10, 20, 50 Exponen0al
  • Support and Resistance
  • Major from Day and 4 hourly
  • Minor from past few days
  • Also include open and close
  • Oscillator
  • Stochas0cs
  • Be certain of your Candle Pajerns

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SLIDE 26

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Chart Setup – Scenario 1

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Chart Setup – Scenario 1

  • 5m, 15m and 30m Windows
  • Stochas0cs
  • Less focus on the 30m Stochas0cs
  • Moving Averages
  • Know your market trend long term to the 3 windows
  • Larger window is the trading window!
  • Ideally looking for Stochas0cs confirma0on on 2 lower

0meframes

  • Forceful candle and Stochas0cs crossing

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A Possible Trade

  • 15 Min Stochas0cs were

very low and turning

  • 5 Min Stochas0cs show

Bullish energy

  • Crossing upwards
  • Look at forceful entry
  • Possible Target?

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Chart Setup – Scenario 2

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Chart Setup – Scenario 2

  • 1m, 5m and 15m Windows
  • Stochas0cs
  • Moving Averages
  • Know your market trend long term to the 3 windows
  • Larger window is the trading window!
  • Ideally looking for Stochas0cs confirma0on on 2 upper

0meframes

  • Forceful candle and Stochas0cs crossing
  • Use 1m window to support 0ming of trade. Less Focus!

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Chart Setup – Scenario 3

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Chart Setup – Scenario 3

  • 1m, 5m and 15m Windows
  • Stochas0cs
  • Moving Averages
  • Know your market trend long term to the 3 windows
  • Larger window is the trading window!
  • Look for Stochas0cs confirma0on on 2 lower 0meframes
  • Forceful candle and Stochas0cs crossing on trade window

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Options – ITM, ATM, OTM

  • In The Money op0ons do move much faster
  • And you will no0ce it!
  • Aim for ATM for about 0.50 Delta
  • OTM do move slower so be pa0ent but aware
  • Where are your target areas / Support or Resistance
  • Trade the candles NOT your profit!

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Decision Time

  • The lower the 0me frame, the quicker your decision period
  • 1 and 5 minute trading you are either buying or you have missed

the trade

  • If you are new to intraday trading, please start with larger

0meframes

  • Big Ques0on: ITM, ATM or OTM
  • In the Money
  • At the Money
  • Out of the Money

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Rolling Out your Options - Example

  • You bought an op0on for a day trade and the market has

reversed

  • You see strong support approaching but the day is ending
  • 1 – Take a loss and try again tomorrow
  • 2 – If you are confident, consider rolling your op0on out a few

days to a week (presuming you bought op0ons expiring today)

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Added Tips

  • Make sure you are aware of your Candle Pajerns and their

force

  • Make quick and intelligent decisions
  • Trade with the TREND for longer trades
  • If Counter Trades! Then use Moving Averages for Support and

Resistance (Targets)

  • No interrup0ons!

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Quick Summary

  • Intra Day Op0ons Trading
  • Buy your PUTS or CALLS and then close at your targets
  • Sit ready to close your trade, however I set a Take Profit aoer

buying

  • Be repe00ve with your successful trading
  • Even at low profit margins
  • Have your trading RULES clearly wrijen and follow them!
  • NO EXCEPTIONS

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Quick Summary

  • Shorter 0meframes have more vola0lity
  • You must s0ll have a mental stop area where you exit
  • Remember Theta – premium loss each day
  • Consider mul0ple chart windows to understand trend
  • Use your charts, Candles and Western Indicators to win
  • Take your profits and beware Support & Resistance areas
  • Look out for poten0ally reversing candles

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From our education to Your Success

Your next step: candlecharts.com/ncs

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