Quote from dipper17:
Actually I think my posts have been pretty civil as compared to most of ET. As I said I was just pointing out actual facts on the pricing of options which you have grossly wrong. I never attacked you in anyway or speculated seriously on your background. The NASA thing was a friendly ribbing.
My experience in the options world goes back more then 2 decades where I have worked as a market maker on trading floors and ran the prop desks at a couple of big banks. So to counter your comment I would say that my experience is a little more then book knowledge and I have extensive trading and risk management experience.
The bottom line is this: The high, low, open and close of any given day be it yesterday or 20 years ago, has virtually NO bearing on the price of any options contract in the future.
The rest of your description about your 3 programs is so vague and so filled with double talk and amendments when its pointed out there are flaws its not worth addressing since youâre not willing to discuss them.
Nor do I expect any sort of real time posting of trades.
I did do a little ribbing but in the general context of ET I was very polite.
The way you changed from saying youâd post trades after a fill to a paragraph about how it ruins your fills is an example of the inconsistencies you post. Only after I pointed out that you said you would post real trades did you then go back and dismiss your comments about fill and claim you would.
I am always open for civil discussion about your topic if others want to join in. Just because you dont like my comments does not mean they are unfreindly, they're meant to provoke thought from the rest of the people here as to the validity of your claims
Quote from dipper17:
King I would agree with you if we were talking about the price of the underlying. There is surely a worthy debate on the merits of gap fills with respect to traded products other than options.
Options are a derivative of the underlying, their price is basically predicated on time, implied volatility, the price of the underlying and the risk free rate ( there are some variations with respect to the different types of contracts and underlyings, but those are the main four for the purpose of this thread). The previous days range is virtually meaningless in tomorrows price.
Quote from kinggyppo:
I imagine this would give you something like a pivot point ( high = low + close/3 for the option. Does the program give you entries and targets as well.
Yes,
the exact entry price (buy limit) and exact exit price (sell limit).
However it doesn't generate a stop price.
I set stops at -25% normally, but there is a "rare signal type" where I use -30%.
The programs sets profits for +30% normally, but again there is a "rare signal type" that has a +25% profit.
Also the programs will usually rate the reliability of a signal in
percentage of probability of profit.
For example:
Today's signal was for the SPY 130 Put at an entry price of 1.94
and a sell limit of 2.43 (+25%) with a signal reliability of 67%.
However it didn't fill as the low was 2.29.
Also, the trade data for a potential trade for tomorrow has been entered in the programs and here are the results:
Trending program: Put.
Intuitive program: Put.
Market Monitor program: Block All Put Trades. Put Trend is in a Decline. No Signal.
It could be wrong, but I found this year that it is right more often then my human instincts or charting ability, so I have resolved myself to respecting its judgement.
Quote from IV_Trader:
Average opening gaps (not filling the â¦) are extremely important to me ( gamma scalping). I check all kind of moving averages ( Hi-Lo , Hi-Close â¦) too before taking new position.
Quote from dipper17:
Jeff is implyig that tomorrows options prices are based on comparing those factors in options prices going back 20 years. [/B]
Quote from jeffalvinson:
Not exactly. I can see you need more details to understand.
Let me take another shot at this (without totally giving away the farm):
Lets take two options on the same index, a call and a put that closed approximately in the 2.00 to 3.00 range.
1: The relationship between the "open" and "high" of a call option is different (bigger or smaller) than the relationship between the open and high of the put option on the same day.
2: The relationship between the "low" and "close" of that same call option is different (bigger or smaller) than the relationship between the low and close of that same put option on the same day.
3: The relationship between the prior close to the current close
on the same call option is different (bigger or smaller) than the relationship between the prior close to the current close on the same put option on the same day.
The "relationship" of Numbers 1 thru 3 above are identifiable trends. Up, Down or Neutral.
Lets add 3 days of these trends together for the call trend and 3 days of these trends together for the put trend and we call this the short term trend.
Now lets add 9 days of these trends together for the call trend and 9 days of these trends together for the put trend and we call this the long term trend (with respect to trading time frames).
Now lets introduce these short and long term call and put trends into programmed formula's that can recognize when a certain calls trend (short and long) and a certain put trend (short and long) taken within the same 3 and 9 day periods of time,
have certain identifiable characteristics that match decades of same data characteristcs and react reliably in a certain direction:
Up, down, or neutral (Call, Put or no trade). Programmed algorithms were a part of the equation.
Hoped that helped a little.
Quote from jeffalvinson:
Dipper,
I am older person with high blood pressure and heart arrhythmia and cannot afford to be stressed, so I have had you blocked on the "Ignore" feature (really nice feature ET!).