Technical Analysis & Options Strategies imparts a system, providing traders with the means by which they can understand and apply each of the strategies discussed. Furthermore, actual market conditions are used to demonstrate strategies, not “after-the-fact” examples. This book is loaded with detailed charts and in-depth analysis for each of the strategies discussed, which include vertical credit spreads; long and short puts; call, put and back spreads; and straddles and butterflies.
Technical analysis involves research into the demand and supply for securities and commodities based on price studies. Technical analysts use charts or computer programs to identify and project both short and longterm price trends. Unlike fundamental analysis, technical analysis is not concerned with the financial position of a company or supply/demand statistics for a commodity.
Some forms of technical analysis, classical bar charting in particular, provide well-defined risk/ reward parameters and measuring objectives. As the technician observes the evolution of a pattern, specific options strategies may be far more suitable for establishing a position than a trade of outright long or short.
This is especially true in the futures markets with the propensity to gap open beyond reasonably placed protective stop-loss orders. Because of the problems of interpretation of price, volume and open interest on an options chart, all of the technical analysis in this book will be performed on the chart of the underlying instrument.
- TECHNICAL OVERVIEW
- OPTIONS STRATEGY MATRIX
- VERTICAL SPREADS
- POSSIBLE COMPLEX HEAD & SHOULDERS
- THEORETICAL EXAMPLE: SYMMETRICAL TRIANGLE
- SYMMETRICAL TRIANGLE IN AN UPTREND
- POSSIBLE SYMMETRICAL TRIANGLE IN A DOWNTREND
- TRENDLINE TEST
- CONVERGING TRENDLINES
- LONG-TERM CHARTS
- KEY REVERSAL DAY
- VOLATILITY FORECASTING
- ELLIOTT WAVE COUNT
- VOLATILITY CHARTS
- PUTTING IT ALL TOGETHER