When a trader is trading options in "chop" are they mostly going long or short or both?
Thanks
Thanks
Trading Chop?
- Thread starter PennySnatch
- Start date
Remember that for every trade, there is both a buyer and a seller.
So the answer to your question is *exactly* "both."
So the answer to your question is *exactly* "both."
If you are trading ranges and I wouldn't recommend this for a beginner, you can go long and short off the S/R given enough room between. It is easier to trade in one direction only, preferably in the direction prior to the congestion as it is more likely to break in that direction when the consolidation ends.
You don't necessarily "short" options...atleast in the same sense of 'borrowing' stock to short;
You simply bet down, or buy the Put option.
But to answer your question, it's hard to say what a trader has specifically in mind or is doing,
You only generally do both/straddle when you expect an explosive volatility move.
So again, to answer your question, ...that trader is most likely directional upwards and/or downwards on what they perceive to happen next,
Trading is very, very basic -- it's far from rocket science,
I even think 'dumber' common sense, observant people are generally more successful with trading...rather then people with professional degrees and engineering and medical stuff.
Give me a guy who hangs around NYC Times Square all day...I bet he'll be a better trader than a random suit with a master's degree,
(i feel like the Duke Brothers from Trading Places)
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