I figured if the 10-8 Day Moving Average Hilo Channel is my money-maker I should concentrate on it.
S&P 500 Sector ETF Momentum Rankings
- Thread starter AndersenBands
- Start date
After being paranoid against credit spreads, I finally crunched the numbers and agreed that credit spreads are potentially better than debit spreads like 80% of the time (check the IV Rank) and became a full-fledged tastytrader, although I don't see any sense in getting into butterflies and condors and lizards yet. I have Excel spread calculators.
I figured I shouldn't need a scalping chart for trading monthly spreads, just something for selecting an outlook and strike prices.
I was going to sell credit spreads on the highest IV Rank equities that tastyworks lists, but the tastyworks chart sucks for selecting an outlook and strike prices, so back to Barchart for a solution.
Go to Barchart Screeners and sell appropriate credit spreads on the equities using the Barchart chart to assist you in selecting outlook and strike prices. Generally sell bull put spreads on the equities above 55 on the 100-day RSI and sell bear call spreads on the equities below 45 on the 100-day RSI. What matters in selling credit spreads is that you place your strike prices and breakeven more defensively than tastytrade recommends so you’re in better shape than most other traders when the SHTF.
Go to Barchart Screeners and sell appropriate credit spreads on the equities using the Barchart chart to assist you in selecting outlook and strike prices. Generally sell bull put spreads on the equities above 55 on the 100-day RSI and sell bear call spreads on the equities below 45 on the 100-day RSI. What matters in selling credit spreads is that you place your strike prices and breakeven more defensively than tastytrade recommends so you’re in better shape than most other traders when the SHTF.
There are no Screeners. Liquidity trumps all. Go to Barchart Volume Leaders and go through the list and decide what each outlook is based on the PPO red lines and then see if you can make a decent profit with pretty defensive strike prices and a minimum need for rolling. Don’t go out more than 6 months on a vertical spread, but you’ll probably have to go out at least 2 months.
You do have to use some scalping skills when trading vertical spreads by tastytrade recommendations so the underlying doesn’t come against you. Decide what each outlook is based on your indicators, select strike prices by your indicators and tastytrade recommendations (1/3 width), roll them if you must, exit the trade before the trend comes against you.
It seems to me there just aren't that many good opportunities in options and if I have to know how to scalp anyway, I might as well just go scalping using puts, calls, spreads, whatever works.
1. It's okay to settle for a low rate of return on an OTM credit spread. It's called "monthly income." Ask Lee Finberg about it.
2. It's okay to have opposing OTM credit spreads. It's called an "iron condor."
2. It's okay to have opposing OTM credit spreads. It's called an "iron condor."
I changed my scalping rig and I thought XLU looked undervalued.
I got rid of all my credit spreads. They just ain't my style. I don't want to worry about them and wait for them. Debit spreads are more advantageous to a good scalper, it seems to me.
