If you are using an options trading system that doesn't incorporate at least some basic technical analysis, you could be missing out on some very reliable signals for trade entries and exits. Understanding TA can also take a lot of the guess work out of trading the Options market.
It is very hard to argue which way the trend is heading if a bar chart is making a series of higher tops and bottoms. Positioning yourself with puts and calls during a trend is like getting carried up an escalator - all you are doing is going with the flow.
But if you are ignoring the trend, and your options trading system is giving you trades that fight the market, it makes it harder to make money consistently. Riding a trend can also give you places to enter additional positions as the price of the underlying security goes up or down. That means you can compound your profits with lower risk than if you ignore what the market is doing. As the old timers always say - the trend is your friend, so you should be going with it.
So does a technical analysis based options trading system work for every trade? No, nothing works every time. Some trades are going to be losers because we can never know for sure what the market will do. But being able to read a chart allows you to see probabilities of what might happen, and then you have to make our trades based on this analysis.
The good thing about options is that we can always roll our contracts up, down or out in time if we need to, so if we are on the wrong side of a trade, we can change the strategy to suit. This is an important benefit, because it gives us more time to let the position become possible, rather than simply buying or selling a stock, where the profit or loss is locked in.
So what choices do you have if you'd like to trade options, but you're not confident in either your technical analysis or trading ability? A great way to cut down the learning curve and become a profitable options trader is to 'borrow' a successful trader's system and use it for yourself. That means you could start trading profitably almost right away.
For a lot of new traders who haven't yet developed an profitable options trading system of their own, it's a great idea to let somebody else spend the time and money it takes to discover an options strategy that makes money. Then all you have to do is subscribe, enter the trades as they are published by the service, and let the system do the work for you.
It is very hard to argue which way the trend is heading if a bar chart is making a series of higher tops and bottoms. Positioning yourself with puts and calls during a trend is like getting carried up an escalator - all you are doing is going with the flow.
But if you are ignoring the trend, and your options trading system is giving you trades that fight the market, it makes it harder to make money consistently. Riding a trend can also give you places to enter additional positions as the price of the underlying security goes up or down. That means you can compound your profits with lower risk than if you ignore what the market is doing. As the old timers always say - the trend is your friend, so you should be going with it.
So does a technical analysis based options trading system work for every trade? No, nothing works every time. Some trades are going to be losers because we can never know for sure what the market will do. But being able to read a chart allows you to see probabilities of what might happen, and then you have to make our trades based on this analysis.
The good thing about options is that we can always roll our contracts up, down or out in time if we need to, so if we are on the wrong side of a trade, we can change the strategy to suit. This is an important benefit, because it gives us more time to let the position become possible, rather than simply buying or selling a stock, where the profit or loss is locked in.
So what choices do you have if you'd like to trade options, but you're not confident in either your technical analysis or trading ability? A great way to cut down the learning curve and become a profitable options trader is to 'borrow' a successful trader's system and use it for yourself. That means you could start trading profitably almost right away.
For a lot of new traders who haven't yet developed an profitable options trading system of their own, it's a great idea to let somebody else spend the time and money it takes to discover an options strategy that makes money. Then all you have to do is subscribe, enter the trades as they are published by the service, and let the system do the work for you.
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