The ACD Method

Quote from Maverick74:

The stock will be 35 pts higher before that. You'll be long gone before they come out.
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umm hm... well the expiration right after earnings will be the best way to take a directional stance in options.. as they won't decay... you can calender otm.. call spread or just out right buy calls in this all day long and the premium will hold up because of the earnings will hold up the options.. obviously you will exit before earnings.. but thats the expiration i'd buy ..

just my thoughts..

GOOG - APR 12 '13 + APR 19 '13 800 Call Calendar Spread
GOOG Apr19'13 800 CALL
GOOG APR 12 '13 + 775 - (2)800 + 825 Call Butterfly

you can move the strikes around depending on your degree of agression..
the GOOG Apr19'13 800 CALL looks expensive at 14.90 but its going to stay expensive untill earnings.. so its alot of delta exposure and theta isn't a concern
 
Quote from cdcaveman:

umm hm... well the expiration right after earnings will be the best way to take a directional stance in options.. as they won't decay... you can calender otm.. call spread or just out right buy calls in this all day long and the premium will hold up because of the earnings will hold up the options.. obviously you will exit before earnings.. but thats the expiration i'd buy ..

just my thoughts..

GOOG - APR 12 '13 + APR 19 '13 800 Call Calendar Spread
GOOG Apr19'13 800 CALL
GOOG APR 12 '13 + 775 - (2)800 + 825 Call Butterfly

you can move the strikes around depending on your degree of agression..
the GOOG Apr19'13 800 CALL looks expensive at 14.90 but its going to stay expensive untill earnings.. so its alot of delta exposure and theta isn't a concern
More...

Yup, I know all the options combinations and permutations. Been trading them for 16 years now. :)
 
Quote from Maverick74:

Yup, I know all the options combinations and permutations. Been trading them for 16 years now. :)
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i figured you did.. i know you have been around for a while.. i talked to you a while back when i tried TOS.. but even so.. for those who don't and follow i figured it would be something i could contribute to the thread since i don't know much about ACD
 
Quote from cdcaveman:

i figured you did.. i know you have been around for a while.. i talked to you a while back when i tried TOS.. but even so.. for those who don't and follow i figured it would be something i could contribute to the thread since i don't know much about ACD
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You're only going to encourage King. He's around here somewhere. :D
 
Quote from cdcaveman:

is that logical trader the best start to look at this strategy?
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Yes, it's the bible as Mav implied. What he is too modest to say is, having read the book, carefully read at least the first 500 pages of this thread. Pure gold as far as applying ACD goes. You can skip the trade calls, but read especially the way Mav uses the various number lines and draws up on overall market picture from strengths and weaknesses in the various instruments.

The discussions with others who experimented with assorted approaches are great for stimulating the imagination.
 
For those of you interested in the levels on AAPL, keep an eye on the monthly and QTR A levels at 412 and 392 respectively. AAPL re-tested it's 52 week low last week at 419 and bounced off it. But the stock continues to make lower lows and lower highs. It's 30 day is zero right now so the stock is technically in a consolidation phase. Probably dead money for awhile.
 
Natty broke out to new 52 week highs. The levels to watch there are also the monthly and QTR levels at 4.17 and 4.24. Natty's number lines have been pretty lackluster for awhile. So there should be at least a decent fade off those levels.
 
Quote from Maverick74:

The number line is not a momentum indicator although it can show momentum. It's more of an indicator of internal strength or weakness. Think of it more like the market internals like TRIN, Avancers/Decliners, upvolume/downvolume. As Fisher likes to say, the number line is the market's vitals as is in the vitals on your health. Someone could look great on the outside but internally could be a heart attack waiting to happen. The number lines show internal price action. It shows you strength BEFORE the momentum. Any tom, dick or harry can buy XYZ when it's breaking out to new highs. The idea is to get in early and to be able to qualify the legitimate strength or weakness.
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The number line is brilliant imo. I wonder if he made that up himself or if he ripped it off some old trader he knew? Anyways, loved the book and the thread. Thanks Maverick.

I may build a whole methodology around trading failed "A's" in the direction of the trend. I.E. Market is in a downtrend overall so look for failed A buys and short them. Seems to me like the risk reward could be killer on these.
 
Not to brown nose, but mav this is seriously the best thread on ET. You really help people to get down to the nitty gritty of how to "think" about trading.

To bad most of them want to get spoon fed a method.
 
I agree, Mav has some great posts throughout this thread. As I read through it all I copy and pasted a lot of what he said, I would def suggest that to anyone who is just starting to use ACD.
 
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