Best Day Trading Software

Posts Tagged ‘Trend’

(Note: I have real money experience with options going back to 2000, first covered calls in my IRA and then long calls in my cash account though no day trading experience with real money. I have the 25K to park in an account to satisfy the pattern day trader rules and another 10K to make the actual contract purchases.)

I have a job that allows me to keep an eye on the real time stock market. Starting in January I started playing with the Virtual Trading engine at OptionXpress, daytrading options on SPY. My strategy is rather modest; I buy 5-10 ITM contracts, either put or call depending on market direction, and sell when I see the trend reverse. I chose 10 contracts because I believe that with an order size that small, if I submit a sell order at the bid it should fill immediately unless the market is moving very fast allowing me to lock in a profit if the trend reverses. I open one position at a time, I never leave my desk with an open position and I am 100% cash at market close every day. I use SPY because being a basket of 500 stocks it is buffered from sudden drastic moves in price giving me time to get out of a position with minimal loss if the price goes the wrong way on me. My immediate goal is 0 after commissions per round trip, a target that requires only a {content}.15 move in option price. I don’t always guess right on direction, 4 out of 5 is typical, and I am netting between 0 and 0 a day on 6-7 round trips. My 00 initial play money stake has grown to about ,000 since 1/19 when I started doing this seriously. I won’t get rich doing this but over the course of a year that is an extra person’s worth of income for my family. If it lets me do nothing more than pay off my house and fund future college for my 3 kids it is worth it.

Now that I have proven to myself that this seems to be a reasonable strategy I am trying to understand what I can do better and am now in the area of "I don’t know what I don’t know." I know about Level 2 quotes but if these are something that can help me I am not clear how to use them. I know that there are all sorts of indicators that technical traders use but I don’t know if these scale down to the day trading level. I know about the existence of the Greeks, and while I understand roughly what the numbers and equations mean, I don’t know if these will help me on positions lasting 15 minutes or less.

My main interest in posting this question is to find out if there are tools I can use to help me make better choices about getting in or out of a position or tell me more about what the market is doing. This strategy seems to be working okay and if I can translate this to real money I will consider myself successful. I don’t want to be greedy but I certainly would like to know if I can do what I am already doing more effectively.

I spent time on 888options and optionetics.com but it seems much of the content out there deals with strategies like spreads, butterflies and condors, things that simply don’t apply to what I am doing. I know there are options day traders, even some specializing in SPY, who read these questions, and I’d be appreciative if I even had a list of books or even just some things to go research and learn about that you have found helpful in your experience.

Thanks for reading this far and any help y’all provide.
I definitely understand the problem with fills; in fact, I asked a question about that here the other day. I had noticed that I could put in a sell at a price like 3.10 and a minute later see a bid/ask spread of 3.15/3.20 with my sell order still open. My only thought was "What the ****?!" I was told by another answerer that in reality, on an order that small an ask below the bid would never stay open on something as liquid as SPY.
Regarding filling at the mid, on SPY I could live with this. The options on SPY move enough intraday that even if every buy order filled at the ask and and sold at the bid I’d still make money because I am looking for moves of .15 on options that can move .30 or more in a short time. I’ve gotten good enough at picking the trend direction that I will buy options that are 3 or 4 points ITM. This gets me my .15 or more move with only a small move in the price of SPY.

Technorati Tags: 25k, commissions, contract purchases, contracts, covered calls, day trading, daytrading options, ira, Job, market direction, minimal loss, Money 97, money experience, open position, option price, pattern day trader, play money, quot, real money, Real Time Stock, spy, Stock Market, target, Trading Options, Trend, virtual trading, wrong way

• Tell me what you think of Obama and why? Tell me what you think of Obama and why? Lets have some facts stated first. Here are just a couple of the bad things he's done so far. Obama has basically created 8 trillion dollars and we dont know whats happened to most of it. Obama doesnt support an audit......
• Would I Make a good President Of The United States? Never made over 20,000 dollars, I have the ability to Understand People. Believe everyone deserves oppurtunity and should have a job. would do this as a President, First to boost the economy, I rescend the 787 billion for Government projects because government projects only stimulate government power. As part of......
• Where Is the Beast of Revelation? The Prophet Daniel had spoken these prophecies. Isaiah, Jeremiah, Jesus and his disciples also spoke of it and stressed on its importance. Daniel said there will be four empires after Babylon. The first was the Persian Empire. The second was the Macedonian Empire (Alexander the Great.) The third was the......
• what do you think of these numbers canada? Why Canada Should Legalize Marijuana By: Peter BeckI -------------------------------------------------------------------------------- I have many vices. Pot, however, is not one of them. I don’t smoke the stuff, and never have, but I don’t sit in judgment either. Recently, I started looking at what could happen to the Canadian economy if we didn’t......
• how can i get the Canadian government to cooperate; are my being taken seriously? Dear Yahoo.com, I know that your News Room, is up to date on the most recent Senate Green Room, discussion over the Canadian Boarder breech case involving, a Marie, who is now recognized as a famed Mobsters Lady? Well, I myself might be a small fish compared to this great......
• Should I not waste my time doing the stock market/real estate investing? I'm making 90k per year after taxes, and I'm only 25. Should i just invest it in CDs and 401k? I want to retire around age 45 and travel around the world and just have fun. Also i'm not a big spender expensive stuff, i drive a used car, and......
• now that fox folk have got the nomination secured for the crooks they are willing to talk about how right Ron? is http://emac.blogs.foxbusiness.com/ Time to Listen to Ron Paul? By Elizabeth MacDonald Time to listen to Texas Congressman Ron Paul, the lone voice of reason in Congress today who’s got to feel like he’s shouting into a field of cotton with his repeated warnings about the dangers of a collapsing dollar,......

• Lotto numbers all hit from last 4 draws On 7 January 2009, the Australian Lotto numbers all hit from the last 4 draws! That is, all winning numbers came from those of the previous 4 draws, a rare event - see draws below. Lotto Results Australia To optimize lotto games for such an event would give tremendous advantage in......
• One Hundred Pushup Challenge -- Knee Push ups, 1 Handed Knee Pushups, and Full Push ups Well if you haven't heard by now then you aren't paying attention to the Health and Fitness blogosphere... Everyone is doing the 100 push up challenge at 100 push ups.   It is a 6 week training program geared toward a final test where 100 consecutive pushups are completed.  (My first......
• Liberals are followers and Bush is a leader. Its better to be right than popular? President Bush's Accomplishments Abortion & Traditional Values 1. Banned Partial Birth Abortion — by far the most significant roll-back of abortion on demand since Roe v. Wade. 2. Reversed Clinton's move to strike Reagan's anti-abortion Mexico Policy. 3. By Executive Order (EO), reversed Clinton's policy of not requiring parental consent......
• How can i win by ex girlfriend back? I am a seventh grader. I have liked this girl for a long time. We have been friends for a long time. Recently I got a haircut and she liked it a lot. I was told she liked me so I asked her out and we went out for a......
• Monday Lotto AU 1million Tonight's draw is quite difficult to predict, but may be worth a few dollars. All numbers will probably be derived from the last 10 draws. 2 numbers out of the following 6 may feature: 3 8 23 24 27 42 12 games played in-house, with "Double up" feature, Cost: $6.05......
• Widgi Creek Golf Club, Bend, OR Widgi Creek Golf Club is located in: Bend, OR Phone: (541) 382-4449 Website: http://www.widgi.com/golf/hours.cfm Course History: This is a great place to stop if you will be in the Bend, OR area. We fell in love with this course and can't wait to go back. It is extremely beautiful and......
• Hi!Funny or no? 24 Fun Things To Do In An Elevator... 1. Grimace painfully while smacking your forehead and muttering: "Shut up, dammit, all of you just shut UP!" 2. Whistle the first seven notes of "It's a Small World" incessantly. 3. Crack open your briefcase or purse, and while peering inside ask:......