Using the 250-day moving average as a green light to be long when price is above it or a red light to be in cash if price is below it can be used as a long term trend filter for trading the tech sector and tech stocks. This is a alternative to buy and hold […]
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Here are ten of the best stock traders I have followed on Twitter over the past decade. I think these accounts are a great place to start for new traders to Twitter or if you just want to follow and interactive with experienced traders that are good at what they do. Two rules that
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Risk management is used in all industries to mitigate the probabilities of the loss of assets. Risk management identifies, evaluatates, and prioritizes the frequency and magnitude of the potential probabilities of risk events. Risk management implements cost effective processes to use available resources to measure, minimize, and limit the impact and damage of both common
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There are three sides of risk management that are crucial to understanding before you trade. The odds you will have a losing trade. The average size of the loss you will experience. The odds you will blow up your account. The odds you will have a losing trade is your percent of losers. Whether projected
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The bearish butterfly option play, (not to be confused with the bearish butterfly chart pattern) is an adjusted butterfly option spread which is a neutral options trading play that is structured to profit from bearish price action. Option traders create this option play when they have bearish signals on a chart pointing to the market
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What are some good strategies to practice as trading drills to help improve your real money trading? For ideas to enhance performance into consistent habits and practices that have an impact on your trading you first must define your edge. Fully understanding your edge that creates profits comes before any plan for structuring repetitive deliberate
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What is the difference between positive skew versus negative skew? Skewness is the measurement of a a coefficient that has the ability to be positive, negative or neutral (zero). The coefficient of the skew is the measurement of the magnitude of the symmetry in the distribution of outcomes of a specific data set of occurrences.
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What does “Buying on weakness” mean? Buying price action weakness is a trading strategy that enters into a long positions by stepping in and buying on a chart while it is still falling before a reversal in price. Traders buying weakness are buying a stock, call option, future contract, forex pair, or crypto currency for
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Michael Burry is an investor and hedge fund manager of Scion Asset Management, LLC Holdings. He became famous by the best selling book “The Big Short” by author Michael Lewis that was also made into a blockbuster movie. Burry’s most famous trade was using derivatives to bet against the real estate market in 2008 which
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Implied volatility or IV crush are descriptions for when an options vega premium dropped dramatically out of its pricing. This usually happens after a major event has passed for the underlying stock or market for the option contract. The most common time to see IV crush in a stock option is after an earnings announcement
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