Edition 828
May 8, 2020
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Master Trader Joe Ross
Author, Trader, Trading Mentor, and Founder of Trading Educators, Inc.
Developer of Instant Income Guaranteed
Chart Scan with Commentary: Options Debit Spread
Recently, one of our students wrote in to ask about debit spreads using options. Such spreads are good when prices are moving sideways.
Coincidentally, Philippe gave us a debit spread in our Instant Income Guaranteed (IIG) program. Here are the details of the trade.
FTDR trade
On 28th March 2019 we gave our Instant Income Guaranteed subscribers the following trade on Frontdoor Inc. (FTDR). We entered a debit spread.
- On 29th March 2019, we sold to open FTDR May 17 2019 36C and bought to open FTDR May 17 2019 34C for a debit of 0.95.
- On 8th May 2019, we bought to close FTDR May 17 2019 36C and sold to close FTDR May 17 2019 34C for 1.46
The most we could ever lose on this trade was the initial debit of 0.95, or 95$ per spread.
Days in trade: 40
Profit: 51$ per spread
Return: 53.68%
Annualized return: 489.87%
© by Joe Ross. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
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Master Trader Joe Ross
Author, Trader, Trading Mentor, and Founder of Trading Educators, Inc.
Developer of Instant Income Guaranteed
Trading Article: Support and Resistance
One short time ago I received a couple of emails questioning whether or not I believe in support and resistance. In fact, one subscriber said if I didn't believe in support and resistance, then I couldn't possibly believe in trend! Why? Because in all cases the situation ends.
Here's what I believe: The trend is your friend until the end. The swing is the thing until it...read more.
© by Joe Ross. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
Philippe Guartier: Administration and
New Developments of Instant Income Guaranteed
ZM trade
On 13th April 2020 we gave our Instant Income Guaranteed subscribers the following trade on Zoom Video Communications Inc. (ZM). Price insurance could be sold as follows:
- On 14th April 2020, we sold to open ZM May 15 2020 60P @ 0.60, with 31 days until expiration and our short strike about 56% below price action, making this trade extremely safe in spite of the volatile environment.
- On 21st April 2020, we bought to close ZM May 15 2020 60P @ 0.25, after only 7 days in the trade.
Profit: 35$ per option
Margin: 1200$
Return on Margin annualized: 152.08%
Philippe
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© by Joe Ross and Philippe Gautier. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
Professional Trader Andy Jordan
Educator for Spreads, Options, Swing, Day Trading, and
Editor of Traders Notebook Complete
Andy Jordan presents...
Need help navigating Day, Swing or Position Trading - Contact Andy Jordan
© by Andy Jordan. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
Professional Trader Marco Mayer
Educator for Forex, Futures and Systematic Trader
Creator of Ambush Trading Method, Ambush Signals, and Head of AlgoStrats.com
Ambush Signals Corona Crisis Report - Free Trial starts Monday!
Many of you have been asking about what's going on with Ambush Signals during the corona crisis. As you might remember we had planned to start a Free Trial week in March just when things got really crazy. Back then we decided to postpone the Free Trial and now finally is the time to start it! So if you didn't sign up for the Free Trial week yet, you can do so on this page. If you did sign up already, nothing to do for you. You'll get an email over the weekend with further instructions.
So what happened to those who were subscribed during the crisis? How did Ambush Signals perform? Here's what happened.
Ambush Signals subscribers got warned on January 28th, 2020 about potential increased risks trading Ambush during to the crisis. Another warning was sent to subscribers on February 24th just before the stock markets crashed. After this, things got really ugly and like any system that performs well during regular market conditions Ambush got hit by an unusual drawdown in some markets. Happily, I had sent out these warning to subscribers really early and don't know of any traders who ignored this crisis altogether and just kept on trading as usual.
From then on I sent regular updates every two weeks about the ongoing crisis and the impact on the markets and Ambush to all subscribers. But knowing that most subscribers couldn't actually use the service in a meaningful way during that time, every subscriber got two months of Ambush Signals for free. On April 26th, I sent out another update to inform subscribers that most markets are finally showing normal market behavior again. So it wasn't fun but we made the best out of it and provided the best possible service to our subscribers. Sometimes cash simply is the best trade to be in!
How Ambush actually performed if traded through the crisis like a madman without any adjustments to position sizes was very mixed. Some markets and portfolios reached new all-time highs, other markets did much worse.
Here's the performance of the Ambush All Stars Small Portfolio:
As you can see there was a short but very dramatic drawdown during the crisis but the performance recovered quickly. Now the question is if you would actually have kept on trading during that massive drawdown? This is exactly what I warned subscribers about.
February 24th Ambush Signals internal blog update by Marco:
"You have to be aware of increasing volatility and accordingly increasing stops meaning higher risk per trade. Be aware of this and adjust your position size accordingly or stop trading until things have (hopefully) soon calmed down again if you feel uncomfortable. The worst thing you can do is to continue trading, take a few large losers and then miss the big winner after stopping or having to stop trading."
So in summary things have been weird but we've navigated as good as possible through the crisis by supporting subscribers with regular updates about what's going on and giving every subscriber two free months of Ambush Signals.
See you in the Free Trial week!
Happy Trading and Stay Healthy!
Marco
© by Marco Mayer. Re-transmission or reproduction of any part of this material is strictly prohibited without the prior written consent of Trading Educators, Inc.
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