Tips & Tricks & Shit
I can't promise this page will be full overnight, but this is where you'll be able to find trading stuff I talk about regularly
Here are some free resources. I hope they help. And if they don't, you can return them for a full refund!
Links & Resources
Trading Tips - Frequently Asked Questions & Answers
Youtube Channel (mostly trading stuff so far)
BaconTrap code for TOS (Thanks to Bacon Bill!)
CalculateER - easily figure out what the implied moves are for ERs
Thinkorswim GoodiesTo use any of these shared settings, click on the "SETUP" link (has a little gear icon) at the upper right of the app and click "open shared item"
Inside/Outside Bars: Easily see inside and outside candles on any timeline by adding this study. White = outside. Gray = inside. http://tos.mx/omcYOOS
Per Session Volume: Allows you to see the volume activity on day-by-day or week-by-week basis to look for patterns: http://tos.mx/ky7d1eH
Volume Buy/Sell Pressure: See the breakdown of buyers vs. sellers in each volume candle. Modified for us colorblinders: http://tos.mx/6oHY3Ts
Inside Bar scanner: Scan for highly liquid stocks with inside bars on the daily timeframe: http://tos.mx/BYEYiHt
My content on YouTube is fairly regularly updated, check there for the latest drivel.
Trading My Alerts
I post alerts in a couple different discord trading groups, and I get a lot of questions, so I wanted to share some info here to help people make the most of the info I share. Info about this alert style at the bottom of this section.
An example of my alert format is above. You can see several columns:
Context - This is the ticker symbol the alert is for
Trigger - This is the price where I want to start watching for entry. MARK means maket price. So, "MARK AT OR BELOW 100" means alert me when the price goes below 100
Current - This is the price of the ticker at the moment I take the screenshot
Status - Active means I'm currently watching. Triggered means the alert already fired.
Notes - This is where I explain my thesis or interest in the ticker. This can be a nice way for newer traders to learn some technical analysis by pulling up the chart and looking for what I'm describing.
I have a couple rules to follow for these alerts:
Don't take a trade in the first 15 minutes of the trading day. Let the initial market open volatility settle down and form some structures.
Don't just jump in as soon as an alert fires. We are watching for Strength or Conviction. Strength is when the break is accompanied by an increase in volume. Conviction is when we break the level with low volume, then pullback to test that level, and continue in the desired direction.
Know your stop and and price target before entering. This is general advice for any and all trades frankly, and gets a call out here. Don't just spray your money all over and hope it comes back. Have a plan. See the structures. Know how much you're willing to risk. If you don't have a solid plan, at least use a trailing stop loss. 25% is a reasonable starting point, adjust according to what works best for your trading style.
If you miss it, let it go. Don't chase, don't worry, there will always be more trades.
Explanations for anything I put in ALL CAPS at the start of my thesis:
SWING: The move I'm looking for exceeds the normal daily range of the ticker, so it may take a few days or weeks to develop. Days to expiry: at least 14
LONG SWING: super slow movers with higly defined patterns can take weeks or more to develop. Days to expiry: at least 45
LONG SHOT SWING: A trade I don't expect to happen, but expect a big move if it does (often getting near a trendline or strong level). I usually just leave these in my alerts list long term in case it happens when I'm not looking. Expiry depends on the move, but lets say no less than 10 days unless you know what you're doing.
SMALL ACCOUNTS: Plays with lower priced premiums that are good for new traders or smaller accounts. TQQQ is my hands down favorite for this.
All other trades I generally select one or two strikes OTM and 3-5 days to expiry. I will play 2-0dte as well on occasion, but I don't advise this for new traders. Theta can eat your lunch in a hurry.
Playing the levels
Most of these plays are break-of-structure plays because they are simple and can be reliable. These work best on trend days.
On range days, however, these levels frequently act as bounce levels (so you can still use the levels, but just in the opposite direction).
Here's how to use alerts
Check out the alerts before Market Open.
Look at the charts and the thesis and look for tickers or structures you like or are comfortable with.
Set a similar alert or marker on the ticker and watch/wait.
If the alert says BELOW, we're looking for puts. If it says ABOVE, we're looking for calls.
Once an alert goes off, check to see if it looks like we'll continue.
That means we must see:
Strength: The price crosses this level with increased volume.
Conviction: The price crosses level with low or regular volume, but tests and confirms the level has flipped
Neither: if we bounce off these levels, then we're in a range. Use levels as an outer bound.
I generally take calls just one or two strikes OTM (out the money) for most plays, and I recommend at least 5 days until expiration for newer traders. if you go shorter than that, make sure you understand your risks with Theta.
If the alert is marked as a SWING play, give yourself at least several weeks (longer better) to allow the play to work out.
Make sure you know your max risk and set a stop loss to ensure you don't lose your pants.
Check out this video that explains it with less words (or at least, fewer letters on a web page)
Why I like this format
I get a lot of questions about why I do things this way.
The main answer is: I am not a professional trader.
I use this approach for a couple reasons:
I cannot actively trade much during the day because I have a job.
This approach lets me set levels for conditional trades.
I do not trade every single one of my alerts, but I do track the performance of each of the alerts. This helps me learn and hold myself accountable.
The other reason I like this approach is because it gives new traders information from which to learn. I put in my study hours, but you can benefit from them if you want.
I dislike the idea of new traders just blindly following alerts without understanding why they are alerts. This seems dangerous to me; I struggle to drive somewhere after using GPS, because it tells me where to turn, now how to figure out the route on my own. Learn to read the map yourself to prosper.
I do not offer financial advice, and frankly, following me is probably a bad idea on many levels. If you're still interested, then buckle up.
The idea of playing a strangle on Earnings isn't new, but hopefully I've got a few wrinkles here that help you land a successful play and avoid duds.
The biggest risk of a strangle on an ER play is that the ER doesn't move the price. This strategy depends on big moves, and attempts to limit the risks of undersized moves.
Since strangles are non-directional, what we are playing is the volatility of a given event. There is danger in the fact that Implied Volatility is generally increased prior to a binary event like an ER, so it is of utmost importance that we pick a strike that ends up ITM (if you don't know what that means, then this strategy is not for you).
To do this, I look for stocks where the implied volatility exceeds the ATR, then I set a strike-zone that is half the implied move. For example, if a given stock has an ATR of $2, but the implied move is $6, we will use a strike-zone of $3 ($6/2 = $3). That means we'll aim for a strike $3 above and below the current average price.
IV generally increases as the ER gets closer, so ideally we can start building a position in the week(s) leading up to an ER to minimize IV crush. You can also reduce IV crush by getting your contracts several weeks out, this reduces the impact of IV, and gives you time if the event kicks off a measured move.
What The FAQ
Common Questions & Answers
Q: What discords are you on?
A: I am an admin on Trading Day, and am a member at Team Trading and Spud Zone
Q: What brokers do you use?
A: I use ThinkorSwim and Webull (and Robinhood for my kids accounts I guess)
Q: What do you like to trade?
A: I play mostly options and futures these days, but I'll probably play equities again when the market recovers a bit more
Q: So, do you drive like a Lamborghini or something?
A: No. No I do not. Even if I had that kinda money, I'd do something else with it :)