Quick profit SPY 10/221/2022 - then a rentry

Uncategorized Oct 24, 2022

If you're like us, and watching the SPY intraday, you will have seen this one on Friday 10/21/2022. The first 15 minutes of the trading day gave us this MACD divergence. At this timeframe, nimble traders took a chunk of  change on call options.

 

As usual we look for out of the money options, with low premiums (expiring on the same day 10/21/2022), and trading at 10c or under.

We found the SPY 374 calls, expiring 10/21/2022 with premium at 10c, and entered the position.  Within 25 minutes the price shot up to over 50c. A quick exit netted us 4 times our money as the lower timeframe MACD turned down.

If you took your eyes off the ball you'd have given back half this gain within 40 minutes of entry.

Not a bad start for a Friday. A possible rentry can be seen below on the same 15 minute chart when the MACD turns back up. The same 374 calls were trading around 6c this time. 

The calls were over 1.00 later in the day, although exiting on pullbacks would likely...

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Did you see this divergence on SPY right at the start of the day on October 13, 2022?

Uncategorized Oct 17, 2022

Prices dropped sharply on SPY in the first hour of trading on October 13, 2022. The MACD on the hourly chart clearly shows SPY should be higher in price

The hourly divergence on the 13th showed us prices should be higher.

Time to look for some calls expiring the next day . We want low premiums so we want:

  • Out of the money options
  • Trading at less than 10c
  • Expiring as soon as possible (October 14th)

In the first hour of October 13, SPY was trading at 348. nearby out of the money options in the 348 - 368 range were over 10c. Options too far out of the money like 380 or above have insufficient time to gain headway.

We selected a middle ground and bought the SPY 370 calls expiring October 14th, for under 10c. The 15 minute chart shows the SPY 370 calls expiring October 14th trading up as high as 1.60 with an entry under 5c during the day on October 13.

Over 10 times your money in one morning

Want to learn how we do this?
 
1-hour and 2-hour...
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Did you see this divergence on SPY right at the end of the day on Friday September 30, 2022

Uncategorized Oct 10, 2022

The MACD on the 30 minute chart clearly shows SPY should be higher in price. We waited until Monday October 3rd in the first hour of trading and still got in at under 10c an option. Let me explain.

The 30 minute divergence on the 30th showed us prices should be higher.

Come Monday morning, we started looking for options on SPY. We want low premiums so we want:

  • Out of the money options
  • Trading at less than 10c
  • Expiring as soon as possible (October 5th)

In the first 30 minutes of October 3, SPY was trading at 361. nearby out of the money options in the 362 - 375 range were over 10c. Options too far out of the money like 382 or above have insufficient time to gain headway.

We selected a middle ground and bought the SPY 379 calls expiring October 5th, for under 10c. The 5 minute chart shows the SPY 379 calls expiring October 5th trading up as high as 25c with an entry under 5c during the day on October 3.

Clearly between 5 and 10 times your money.

Want to learn how we do this?

...

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Fed Option Play 9-21-22 - volatility showed the way

Uncategorized Sep 25, 2022

We were watching the volatility index prior to the fed announcement on Wednesday. There was an upside divergence late in the day, after the fed raised rates again and the downside divergence on the majors! Here's UVXY 15 min upside divergence.

At the same time here's the SPY MACD divergence down on 10m bars shaping up nicely.

The 379 SPY puts expiring the same day led to over 40x your money in one hour or less! Here's the chart.

The Options Hunter approach focuses on divergences between the MACD and the price action. We don’t employ other indicators such as RSI, Stochastics or Bollinger bands as we keep our approach simple, straightforward, and repeatable

 

What are Weekly Options and Why Do I use them.

Weekly options are a great way to make money, but it can also be incredibly volatile. Trading weekly should only really be considered for experienced traders who know what they're doing because there is no guarantee that any profits will even exist...

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SPY 9/1/2022 divergence forming late in the day - confirmed on 30 min next morning

Uncategorized Sep 09, 2022

SPY was setting up a divergence in lower timeframes late in the day on 9/1/2022. We waited until next day and saw the full divergence on 30 minute price bars  in first hour of trading.

A look at the options expiring that day that were out of the money, and under a dime revealed the 405 calls trading from 3 cents upward.  Holding them through the next 30 to 40 minutes of trading yielded between 17 and 22 cents gain. Not to bad for a nimble trade on the expiration day.

 

The Options Hunter approach focuses on divergences between the MACD and the price action. We don’t employ other indicators such as RSI, Stochastics or Bollinger bands as we keep our approach simple, straightforward, and repeatable

 

What are Weekly Options and Why Do I use them.

Weekly options are a great way to make money, but it can also be incredibly volatile. Trading weekly should only really be considered for experienced traders who know what they're doing because there is no...

Continue Reading...

The 2nd Law all Options Traders need to know

Uncategorized Aug 27, 2022
Law 2 - Plan the trade then Trade the Plan
 
Only about 10% of the traders are truly successful. The Options Hunter blueprint is a cornerstone to this success and can be distilled in 4 simple steps.
 
1. Identify the Chart Patterns
 
Scan  the major markets or ETFs for double top or double bottom price patterns. Remember to look for “M” price pattern at tops and “W” patterns at bottoms. On the daily, weekly or monthly charts. If you see exactly what you want, then tag the chart into a special group or just write it on paper to review at the end.
 
2. Check for MACD Divergence
 
If you see the price double top or double bottom, then look at the MACD to see where the second bottom is on the indicator. Is it strongly diverging from the price?
 
3. Tag for Review
 
Patterns can exist on the daily, weekly or monthly charts. If you see exactly what you want, then tag the chart into a special group or just write...
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The first law All Options Traders Need to Know

Uncategorized Aug 25, 2022
There are bold and aggressive traders, and there are older, more experienced ones. But rarely are there the old, experienced, and bold. The markets are unforgiving and the laws of the market are irrefutable. Most traders continue to challenge these laws, but very few succeed.
 
Law 1 - TRADE TO WIN
 
Trading to win is based upon the notion that trading is a journey in self-discovery and that trading as in life is about growth, courage and meeting challenges. It requires a commitment to excellence and the belief that learning is critical to success. As a trader you have to accept you will have losses and accept that losses are lessons and an expense of doing business; that failure is only feedback.
 
Traders who trade to win exhibit:
 
• Patience in waiting for the high probability trades
• Own their trading results
• Execute a repeatable trading blueprint.
 
Trading not to lose is based upon the notion that trading results must come...
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UVXY shows the way again

Uncategorized Jun 23, 2022

UVXY, the ProShares Ultra VIX Short Term Futures ETF, has been providing the Options Hunter with detailed insight into the direction of SPY. Unlike VXX, the Volatility Index linked ETF, the UVXY provides us with a 1.5x leveraged measure of the VIX volatility. When UVXY goes up, it's a sign volatility on the market is going up and likely that SPY will go down. Because it's leveraged, the UVXY tends to be more reactive.

Incorporating UVXY as an ETF we monitor for MACD divergence gives us a rapid heads up of a direction change in the SPY. Nimble traders can profit quickly from these divergences on UVXY by trading OTM options on the SPY.

Dale gave us a great example on June 6, 2022

June 6, 2022 at 11am eastern (8am pacific) the UVXY was trading down close to $13, having been at that level an hour earlier as you can see in the 3 minute and 5 minute charts of UVXY below. In both charts the MACD is showing a clearly higher bottom at 11am vs 10am (8am vs 7am pacific). The price...

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Mechanics of the VIX

Uncategorized Jun 02, 2022

The Volatility Index (VIX) is a relatively new financial indicator. The VIX was first created in 1993 using options on the S&P 500, but has since expanded to include other indexes and options. The VIX measures the market's general expectation of volatility, and due to this, it is often used as a leading indicator of market volatility. The VIX is calculated using prices for call and put options on the S&P 500, so it represents expected future volatility of a future market path - it's not a market predictor in and of itself.
 

The VIX in technical terms is the volatility of a variance swap; the square root of the par variance swap rate for a 30 day term beginning on the present day. Simply, it is the anticipated annualized fluctuation in the S & P 500 index.

The volatility index (VIX) refers to a measure of implied market volatility. It tends to move inversely with the markets – when the market is in calm waters and low volatility, the VIX will be low – and...

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IWM 10 minute charts May 3 - 4, 2022 several patterns, which to trade?

Uncategorized May 11, 2022

During the May 3 and 4 trading sessions we monitored 3 divergences in MACD, two divergences up and one down with accompanying patterns on the 10-minute charts. Here are the three patterns we identified.

When considering the first MACD divergence up on May 2, 10 minute chart at around 2pm eastern, a look at the higher timeframe like the hourly chart below, gave us an MACD divergence to the upside at the same time.

Selecting say the OTM 195 calls expiring May 4, 2022 (he closest expiration), entry at the divergence could have been had at around 10c. exit before the day was over around 20 to 24c was the best you could get from this modest move.

The divergence down, that was a fairly narrow double top on May 3 around 3pm eastern is clearly still within the influence of the hourly divergence up from May 2. Any trade here would be fighting against the longer term opposite pattern.

The third divergence was an upside one on May 4th at around 2.30pm eastern. Again looking at the higher...

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