Editor’s Note: What most of the billionaires and hedge fund managers on Wall Street want you to believe is that options are too risky, too complicated, and simply not worth your time. They’d rather have you dump hundreds of thousands of dollars on the most expensive stocks out there – so they can take the profits. And they’re counting on the misinformation they’ve put out there about options to keep it that way. Here’s why…
With back to school ads on every corner, it’s that time of the year we all dread – the end of summer.
Now, the last thing you want to do is sit in front of a computer waiting for the right moment to grab your profits…
That’s why today I’m going to show you a longer-term strategy that will change the way you trade starting this second.
And you won’t even have to leave your poolside chair…
Today, we’re going to focus on a trading strategy I like to call the 10/30 cross trade.
It all begins with moving averages (MA). You start with two MA’s with different lengths – a short-term MA and a long-term MA and you put them on the same chart. From here, you will be looking for crossovers which will be caused by the movement in the market.
What we look for is the shorter-term MA to cross above the longer-term MA during points of bullishness and vice versa for points of bearishness.
Now, I recommend a 10-day simple-moving-average (SMA) and a 30-day SMA. By putting these two together – you will notice specific patterns form.
For instance, when the 10-day SMA is above the 30-day, you should be bullish. And when the 10-day SMA is below the 30-day, you should be bearish.
And playing this crossover is simple – there are two rules…
- If you’re going with a straight-forward call setup, go with 60-90 at-the-money calls on stocks that are less than $100 a share.
- If you opt to go with a call spread, I would advise going with 60-90 at-money-calls on stocks that are more than $100 a share.
From there, your exit strategy should be looking for a double but worst case – get out within two weeks of the expiration date.
With this setup, you’ll be able to enjoy that summer barbecue, the major league baseball game, or even a day by the pool and it can all be paid for by your latest 10/30 crossover win.
Now, if you’re like most people, having little-to-zero time during the day to worry about your investments, here’s another way…
It all comes down to this very specific series of calculations on a stock:
- The first calculation analyzes changes in a stock’s volatility.
- The second measures its variability and dispersion rates.
- The third looks at speed and change in price movement.
- And the fourth identifies overbought and oversold conditions.
Here’s the exciting part… all of these calculations have to be done once the market closes. Meaning you get to make your moves anytime you’d like between 4pm and 9:30am, every single day…
In fact, the next move comes out tonight after closing bell. And with one simple move, you could be in position to see 50%, 75%, even 125% in your account the very next day. Everything you need to know is right here…
I’ll talk to you soon,
America’s #1 Pattern Trader