posted
hey board just was looking a some news i was saying that negative earning might effect cvc but the news out is that a company is buying them out and going private so the after mkt price is up over 3. to 36.,so those 30 dollar puts that were going for 30 cents won't be any good
Posts: 32 | From: redding ca usa | Registered: Jun 2003
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quote:Originally posted by cassity: What's everyones thoughts on buying a $60 put option on AMZN?
Honestly, I am unsure....thought the QQQQs would have been dipping good by now, and they are riding high...
The chart on AMZN looks way overbought on both the daily and the weekly to me, but they also had a huge boost with that recent news that added 25% to their value. Probably depends on the timeframe and what you really believe about the company...
I am curious to hear Chart's opinion on this one
-------------------- Study before you buy, Sell before you think about it.... Posts: 3903 | From: Gulf Coast | Registered: Jun 2006
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That's what I nicknamed this indicator I made. The perfect marriage! Full Stochastic superimposed over a MACD Histogram (-NOT a regular MACD, a "Histogram")
I think we all know how importance of the Stochastic indicator and how it measures the OVERBOUGHT-ness of a stock or the OVERSOLD-ness of it. The classical "Buy Low Sell High" indicator! Combine that with the HISTOGRAM MACD which allows you to SEE the trend changes and momentum and you have a SuperMAC!
SO WE ARE ON THE SAME PAGE, -view links, info about these two indicators, for newbies too.
About Stochastic: http://clearstation.etrade.com/education/oscillating.shtml Oscillators determine the short-term movement of a stock. They identify turning points when you may want to buy or sell a stock. Using an oscillator can be tricky. There are a number of caveats to heed. But once you understand them, the trading world opens wide before you. In this section, you'll learn: What stochastic is and how to read its signals -------------------------------------------------------------------------------- -------- Info on MACD and Histogram MACD http://clearstation.etrade.com/education/trending.shtml -------------------------------------------------------------------------------- --------
Java charts. Now, in your optionsxpress accounts select Full Stochastic, then MACD Histogram (which is just bars). Then click the "super impose" button on the bottom to make the two indicators one yielding one "SuperMAC." -I'm getting hungry just talking about it!! LOL ~
Now let's see how she works!
Pull up a 5 year WEEKLY (java) chart on the cubes (QQQQ) with only SuperMAC. Look how this baby BAGS BOTTOMS!!!! How can even Forest GUMP not make money now?!!!!
The cubes are an interesting animal, the more you study historic charts you see that sell offs don't last long, however BULL runs can last long. In other words when Stochastic is OVERSOLD and at the bottom of the indicator it's a almost perfect bet that it's going up, AND SOON!!! But when the Stochastic is in the OVERBOUGHT section, it may slightly bounce up and down for some time, making a PUT option MORE risky then CALLS. -Look at the charts, you'll really see it in the daily charts. Even our recent run proves this true.
So we know that it's safer to buy CALLS then PUTS according to the historic charts. On average the market does (over a 10 year period) average itself up about 6-9 percent depending on WHO you ask...
Just knowing that you could simply buy CALLS on a WEEKLY chart with a low OVERSOLD Stochastic far out (LEAP) and wait and win, theoretically... BUT,... You would be a fool to do that with a PUT IMO.
Full Stochastic has a "more powerful, meaningful" OVERSOLD indicator when used on a Weekly chart then a daily chart. The weekly chart AVERAGES in everything on a WEEKLY bases...-Understand?
Example, in a 1 minute chart Full Stochastic will go in and out of oversold and overbought levels all the time, BUT HOW DO YOU BAG THOSE ""TRUE"" BOTTOMS Chart walker?.. (selfless plug! LOL).
Simple, if using intraday 1 minute charts also have a 5 minute chart going, the 5 minute chart will AVERAGE out a BETTER oversold level. Want an even more powerful oversold stochastic buy in point? Simple use a 10 minute chart, better yet use a 15, 30 or 60 minute chart for a REAL oversold condition! Then use the quicker minute charts for a buy in point.
I used to do this with penny stocks live when CSHD was running, it would go up and I'd say this isn't our bottom yet, and no matter how the board cheered the stock on, it would fall more, almost like magic. All I was doing was watching the 5 minute and seeing it was just starting it's down turn, so ON AVERAGE I "knew" the price would fall yet... -get it?
Now let's multiply and COMPOUND what we know so we can melt the cubes!
1) We have learned that the SAFEST option to buy according to the historic charts is a CALL. 2) We learned how to fund a TRUE OVERSOLD level by backing out of the minutes charts and looking at the WEEKLY charts. Then go into 60 minute or 30 minute charts to buy in. 3) Make TIME your friend, buy out 6-9 month Calls. PLAY IT SAFE!!!
The old saying "Never go against the trend" holds true. -and you find the Trend in the Weekly chart. I still like using the gallery page at Stockcharts.com. That's almost always my first stop when checking out a "hot tip."
Pull up a 5 year WEEKLY (java) chart on the cubes (QQQQ) with only SuperMAC. Right there is your retirement, week by week. Ok, don't want to do just 2-3 trades a year and easily DOUBLE (or way more!) your money and want more faster action? Not a problem!
We can do a little quicker then that, but it gets more risky... That's why I say "Make" TIME and PATIENCE your friends by buying options out 6-9 months.
But if you like to PARTY... LET'S PARTY!!
Here are the Sacred steps Chart walker takes.
Step one. Start with a 3 year weekly java chart and a SuperMAC indicator, QQQQ. Well heck look at how beautiful and easy that is! Do I even have to point out the bottoms? LOL ~
Step 2 Wait for your bottom. -or for practice, let's pick the last bottom just before April when Stochastic hit the magic 20% OVERSOLD line.
Step 3 Go to a Daily 6 or 9 month chart and take SuperMAC with ya : ) Notice when we hit the magic 20% oversold level, which we know is REALLY OVERSOLD because of the Weekly chart.
Step 4 Clearly as March progresses the Histogram is showing momentum going to the positive up side, Stochastic crossing positive also. Time to start the grill!!! ha ha ~
Step 5 Pull up a 60 minute 60 day chart with your buddy SuperMAC. Step 4 showed us that toward the middle of MARCH we should be looking for a super oversold buy on a CALL option, and look at that! Heeeeeeere's your ""TRUE"" OVERSOLD bottom buy in point right at 3/15!!!! The bottom of the bottom peeps!!!
"Have I mentioned I LOVE MY INDICATORS and CHARTS lately?!!!" LMAO ~
Now keep FOCUSED. There are many bottoms and oversold levels which will WRECK YOU if it isn't a TRUE bottom and you're going long. Short term they most likely will go up, but you have to watch and flip them because some will be "stronger then others." Where most people screw up is following only a 1, 2 or 3 minute chart looking for Stochastic oversold levels to buy into and catch a "weak" oversold level and then say ignorantly that chart and indicators don't always work!
HA!!!
They work TOO WELL, and THEY just don't understand HOW to use them... I think I just proved that didn't I? And on the most popular traded ETF (Exchange Traded Fund) in the WORLD none the less!!
You are all very welcome for this PRICELESS info. Let us know how you do!!
Why do I ONLY have 4 stars by Chart walker?... -hint hint...
No CALLS bought, but the charts tell me those are the ones to play "statistically" speaking, they don't stay long in the oversold like the overbought section likes to do.
I started this thread to LEARN. There is alot of info here.
Knowledge is "potential" Power... -you have to USE IT.
In a very short time we have really got to know the cubes (QQQQ). That last post of mine walks you through not only how to buy on a dip, but to buy in on the "dip in the dip!"
There isn't much more to learn, yet there are always things to learn
posted
Thanks for the info Chart. I'll have to read over that a few times to get it though. Will you still be doing some plays, using this new stuff, here on the board? That would be awesome!
Sherri...great call on CROX. Did you get in on it?
Posts: 1028 | From: Georgia | Registered: Jul 2005
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quote:Originally posted by milliam: Thanks for the info Chart. I'll have to read over that a few times to get it though. Will you still be doing some plays, using this new stuff, here on the board? That would be awesome!
Sherri...great call on CROX. Did you get in on it?
Nope, but thanks....was just looking at the $70 price tag and wanted to cry I still think it will go even higher as the summer goes on...
-------------------- Study before you buy, Sell before you think about it.... Posts: 3903 | From: Gulf Coast | Registered: Jun 2006
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posted
It looks like the weekly chart is finally topping out here. I'm pretty leary of buying more puts on the Qs, but now looks like the time. I need to make some money back from all of the other puts I've been hanging onto for way too long.
I'm looking at the Sept. 45 puts.
Posts: 1028 | From: Georgia | Registered: Jul 2005
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posted
The MACD is just getting to negative territory, and the stochastic is trying very hard to be oversold. The question, of course, is if this is really a downturn, or another 3 day "correction".
-------------------- drysider
My advice is worth exactly what you paid me for it.... Posts: 30 | From: Liberty Lake WA | Registered: Apr 2007
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posted
I think that the negative vibes from hoping for a downturn work against buying puts....at least thats my story and I'm sticking to it. I'll wait to buy calls and root for the home team.
-------------------- drysider
My advice is worth exactly what you paid me for it.... Posts: 30 | From: Liberty Lake WA | Registered: Apr 2007
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quote:Originally posted by drysider: I think that the negative vibes from hoping for a downturn work against buying puts....at least thats my story and I'm sticking to it. I'll wait to buy calls and root for the home team.
Sounds like a good story to me - the puts are just comical at this point. The charts are ready for a downturn, but the index is not.
-------------------- Study before you buy, Sell before you think about it.... Posts: 3903 | From: Gulf Coast | Registered: Jun 2006
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posted
I have a question that may be too general or simple to answer but here goes. What makes an option move? What are the fundamental, underlying factors that usually make one move one way or the other? I've seen some options that when the stock price drop, the option doesn't move at all. Sometimes it move a lot down and then other times it has inched up. What gives?
Posts: 21 | From: Atlanta | Registered: Aug 2005
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posted
My best answer for you is two things - the time involved and the stock price. I have QQQQ June puts and Q Oct calls right now. The price of Q has gone up nearly $1 since I bought, but little to no price movement on my options. My QQQQ options on the other hand have deteriorated quickly because the price of the stock has moved slightly, but the time to expiration is coming sooner.
The rest I think is simply volume on the options and trading interest.
Anyone else care to take a stab?
-------------------- Study before you buy, Sell before you think about it.... Posts: 3903 | From: Gulf Coast | Registered: Jun 2006
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posted
Well, you've got your supply and demand as usual, and I'm sure there's some greek symbol that also shows why options move.
I'd say its all about time and in/out of the money (as Sherri said). An option that is just a little out of the money, but only has a few days can move huge if the underlying stock moves towards that option going into the money. So an option's worth can increase quickly due to time, but its got to be close or in the money too.
Usually, the more time, the slower the movement.
Do you still have those examples you were looking at?
Posts: 1028 | From: Georgia | Registered: Jul 2005
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posted
I don't know about you guys but my June 43 puts are killing me. I hope we have a strong move soon to bring me atleast back close to even.
Posts: 21 | From: Atlanta | Registered: Aug 2005
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