(Thu Feb 10th, 2009

Currency Trading

What is currency trading? Currency, also known as Foreign Exchange or Forex, trading is the buying and selling currencies. Why might you want to start currency trading? There are a number of good reasons. Low cost of entry, longer trading hours, liquity, low commissions, and leverage.

(Tue Jan 15th, 2009

The Dow dipped down to 8000 ^DJI again today. I should have posted about shorting the market on the 7th. Sorry that I did not, it was an easy to spot short. I've been sick and neglecting my posting. I was a buyer of the Dow today. I started buying yesterday at 8200. Hopefully we'll get another nice bounce to around 9000 again, if it does it will be the 7th such bounce since October.

I also exited my puts in Goldman yesterday. Wish I had waited until today. I did however buy some Feb Goldman 85 Calls. I'd normally believe that I jumped the gun and bought them too early. But I'll get out if it drops below today's low of $69 and get back in once I see it start to have some upward momentum. I'd also get out if I make a quick $1 per contract.

(Mon Dec 22nd, 2008

Lets hightlight some high yielding stocks that might be great investments for traders and investors a like. These can be great beginning trades whether you are considering using the Credit Card Arbitrage strategy or not. Continue reading about High Yielding Stocks

(Mon Dec 15th, 2008

I hope you beginning traders out there mulled over my trading idea from last night's post and picked up some Google GOOG options when it popped above yesterday's high. The GGDLF GOOG Dec 330 Calls went from $3.00 at 2:20PM to $6.80 at 3:20PM. They worked out just how I had hoped.

While it would it be nice if every once in a while we traders could make the perfect trade. I'm happy I was able to catch most of today's move and the only reason I'm still trading after 5 years is that I'm content in the knowledge that there is no such thing as a perfect trade! It is a lesson that all Beginning Traders need to learn - Be content with the trades and money you make. You are never going to catch every part of a move. Be content. Contented traders are successful traders. I hope you were able to catch a good portion of today's move whether your were in Google, the indexes or the great Goldman Sachs.

(Mon Dec 15th, 2008

Something to note is that Google GOOG popped above its 20 day moving average on Dec. 9th, and almost brushed its 50 day moving average yesterday and today. I'd be on the watch for either a pop above today's $318.49 or for a drop back down to around $294. If it were me I'd take a small position in GGDLF GOOG Dec 330 Calls, if it went above $318.49. They expire on Friday so the trading can and will be volatile. I'd exit very fast if GOOG runs up into the low 320s and quickly crashs back down or I'd exit for a quick profit if GOOG rallied above $325.

Or I'd take a small position in GGDXR GOOG Dec 290 Puts, if GOOG drops below todays low of $305, being very mindful that $300 is a strong pyschological floor for GOOG and that it could very easily touch or even dip below 300 and rocket back up into the $310s. I'd exit the position if GOOG went below 300 or if it pushed back above 310 after dipping below $305.

I'd expect to lose at least half of either trade amount if I took them and things went bad and I'd be happy with a small quick intra-day profit if things went well. These are not trades to hold overnight. Remember both of the above options expire THIS Friday. If you have a stonger conviction in GOOG's strength if it pushes above its 50 day moving average (and I'd respect that conviction) do your trade with GOPAT GOOG 400 Jan 2009 Calls.

(Mon Dec 15th, 2008

I'll continue my discussion about credit card arbitrage. While it is not a trading strategy per se, it does create several options for low risk investing. In the Credit Card Arbitrage article I discussed the typical credit card arbitrage strategy. In this post I'll talk about a different arbitrage strategy that might be of interest to the more risk averse. Continue the Pre-pay Mortgage arbitrage strategy

(Thu Dec 11th, 2008

I'll take a break from talking about the indexes and take some time to talk about credit card arbitrage. What is this you ask? Well it is when you take out a low (sub 3%) or 0% balance transfer and instead for paying off an existing loan you deposit the money into your brokerage account and invest it at a higher rate.
Learn more about credit card arbitrage

(Thu Dec 11th, 2008

It is absolutely disgusting to me when I hear about massive hedge fund ponzi schemes. This type of event shows us just how hard trading can be. Take stock of your temperament and what your expectations are when you start trading. I'll write an article about different trading styles to give you an idea about what I mean by take stock of your temperament. Here, I'll just say that I'm a laid back guy who is much more suited to swing trading than day trading. I tried day trading for a year and it was a complete disaster. As an option trader who focuses on intermediate to long term market moves, I am very happy and successful.

(Wed Dec 10th, 2008

I'd like to take the time to talk about a good options broker. A good options broker is very important for any and every options trader, and even every investor. more about options brokers

(Wed Dec 10th, 2008

Well the move on Friday did indeed follow through on Monday pushing up the Dow to 9151, for an 11% move. I must admit that I exited at 8950, I wasn't quite sure that we'd push above 9000.

The last two days have been sideways and I'm not going to get in until the Dow pushs above the 9151 or until it dips down to 8200 again. When the signs indicate a change I'll be sure to post with my trade ideas.

(Fri Dec 5th, 2008)

Wow a seventh dip for the Dow to 8200. Hopefully you were able to pick up some futures, options or DDM - the 'Ultra Dow30 ProShares' ETF. DDM dipped to around $28 and bounced to $31 for a quick 10% move today.

Yes, I got tricked out on Thursday for a small position when the Dow pushed through Wednesday's 8654 and only went to 8705. But I did what I said, took a small position and built on it when the Dow touched 8200 today. I bought 3 times as much at 8200 as I did at 8660, so the average gain for this move is about 3.8%, but since I'm using options on the index my percent gain is much higher. The gain would have been 7.5% had I been using DDM. I exited the part of my position that I entered on Wednesday and today. I still have some that I picked up on Monday. Hopefully, we'll see a continuation of the move up next week.

(Wed Dec 3th, 2008)

The market is moving great for a trader. The dow has hit (or pierced) 8200 six times and bounced at least 5 percent since October. more