Site Links

How I make my trades

The Goal of this site is to show new-comers, novice, or intermediate option traders how to get started without losing their shirts. The best part of options is that a little bid of money can turn into a lot of money.

With options you can minimize your losses. You could invest $2000 in a stock, with hopes to make $200 on a 10% trade over 12 months, and risk losing $2000 in bankruptcy. Or, you can trade options, risk $200 on a monthly trade, and worst case scenario, you lose $200 and 1 months time. better than losing $2000 and 12 months time, right?

This site isn't to educate you on what an option is, or what a contract is. I figure if you have made it this far, you already know all of that.

The point of this blog is to show new investors with small capital (less than $1000) that they too can make some big returns.

My guideline for Beginner option trades:

- Never trade more than $250.

With options, you can turn $250 into $500 in a day. If you are lucky, you can turn $250 into $1000 or more. Each trade you make is just that, a trade. Sometimes you will get a huge 200% or more move. I try to lock in profits over 50%. $100 profit is worth my time.

- Focus on contracts between .40-.80 each.
This allows you to buy 3-6 contracts on your budget. if you get a huge pop on your initial trade, you can sell half of your position, lock in your profits, and hold the other half and ride it higher.

- if you lose 30% of your premium, i suggest closing the position and taking the loss.
With option trades, sometimes you can recoup a little, but from experience, it is always a losing battle.

- try to buy monthly classes approx. 1-2 months out.
Hold off on weekly options until you are an intermediate trader. these options will see modest moves, and you will have some time on your side, which reduces premium loss due to time decay.

- There will always be another trade.
Don't chase into trade, there will always be another. If a stock is up 2% on a day, you missed that trade. Don't get angry or feel that it is going to continue and you should just jump into a trade. Just sit back and watch.

- Be careful who you copy when you trade

There are a lot of great traders on twitter and stock twits. however, no one is perfect. please do your own DD before following any trading advise, no matter who it is.

- Paper trade often

Ive been trading for 3 years, but I still paper trade a lot. This helps me build more skills so i can make better real trades.

- Stay away from Puts

You can make lots of money either on the up side or down side, however, you really need a stock to tank to make a mean profit on a put. sometimes emotions come into put trades too. Example - Trading Best Buy puts 2 years ago when the stock was at $12... every one thought they were done, out of business, finished. I lost all of my premium with that trade. If you are a beginner, stick with calls. You will be happier that you did.

- Learn how to do some charting.

Basic charting can make your decisions a lot easier. you don't need to be a professional to chart. just start drawing some lines, and find basic support/resistance lines.

Any post I make on this site are just my VIEWS and suggestions. If i make a trade i will post a screen shot. most of the time I do not make the trade. I like posting to share with other traders.

$AAPL Watch for Bottoming over the next few days, next leg up imminent!

Contrary to all the happy horseshit about apple stock, this is going to make a move up soon.  Look at key levels.  Hit Bottom BB band, CCI low, MACD diving.  Wait til MACD volume changes, but bottom should be in or in soon.  Keep an eye on this $AAPL here.  

$NOK August $9 Calls are stressing me out

Still feel like we will break upwards on some news with AMZN.  $MSFT and $NOK calls were going like crazy a few weeks back.  there was a report of AMZN using $nok software in their upcoming smartphone.

Who knows, all i know is that NOK has a fat div coming, and an estimated earnings date of JUL 17th.  Huge OI in july and AUG.  AUG calls out weight puts by ALOT.

Smething is up here, AUG OI hasn't sold off, down around 50% from their initial buy in.  must mean bigger picture stuff

Chart attached

$PG looking for a 2nd Breakout!! Div increase Coming?

Keep $pg On watch for break out.  can be $80++ soon! Options are very cheap because this stock hasn't moved in a month!

$PG should be announcing their 55th annual DIV increase any day now.  notice we broke the 50DMA the other day with SPY being red.

keep this on watch, should return to $80 area soon!


Check out the trend line from the last high.  stopped in its tracks today.  maybe tomorrow?

$RAI Reynolds Heavy August call volume (Chart)

$RAI Reynolds has a lot of bullish call volume in august.  Look to break this trend line soon?  time will tell.  MACD getting bullish, lets see what next week brings before following in!