3/24/18:

Mylan Provides Profit and Clues

 

The hourly chart of MYL details the put activity over the past two sessions.  Entry was made on Thursday the 22nd and exited on Friday as price action neared support levels.

 

MYL continued on through support and closed near the low of the day.  That price action now puts MYL in spring position (closing below support).

 

Monday the 26th, could see an attempt to move higher.  The overall (monthly, weekly, and daily) trend remains to the downside.  Rising price action in a downtrend may give us another opportunity to position short.


3/3/18:

 

With the public thoroughly conditioned to buy every dip in gold, upside trades on bearish reactions have a high probability.

 

We typically do not trade calls as there is quicker action to the downside (puts).  However, this time it worked out.


 

 Trading Method

 

Our market approach follows WyckoffLivermore; Identify a set-up that has probability for a move lasting several days or weeks.

 

Contrary to standard pablum about ‘money at work’ in the markets, the hard unvarnished truth is the exact opposite: 

  • As soon as a trade is entered (by anyone under any condition), money is not at work … it’s at risk. 
  • The objective is to minimize the risk and therefore minimize time in the market. 

Minimizing time in the market was a tenet exercised by Gerald M. Loeb, the late Vice Chairman (and co-founder) of E.F. Hutton  If you're old enough to remember these commercials, then you may know they were referring to Loeb.  'When Loeb talks, people listen.'

 

Our results show that markets can be timed effectively.


3/4/18:  Biotech put in February nets over 1,000% gain

 

The IBB Put option trade is a good example of why downside action is preferred. 

 

While option calls may net a few hundred percent gain as in the GLD trade… puts are a different story altogether.

 

Using our near-expiration method, it’s one day to expiration for the 2/9, IBB 104.00 Put.  All hope is lost with a contract price near zero at:  0.20.

 

Understanding where one is in a price move is critical.  On February 8th, the down move in IBB does not appear to be finished.  Price action over the prior two sessions rebounded modestly and appears to be in a stall.

 

Action moved sharply lower during the 8th and the early part of the 9th.  Real time tape reading was used to determine that we’re at an extreme and the trade was exited (with over 1,000% profit) mid-session as shown.

 

No more than a few minutes later, IBB began an upward move that ultimately culminated in a 105.67, close for the session.

 

Had the IBB put been held into the close, it would have expired worthless.

 

Options Strategy

 

 

Trading options requires advanced market skill in three areas:

  • Vehicle
  • Direction
  • Time.

Get all three right, and the rewards are significant … get it wrong, and it can all go to zero.

 

Our option strategy is simple ... but not easy:  

Trade high probability market set-ups using near expiration put (sometimes call) options.

 

The open area of this site posts the results of selected option trades … and at times, other directional (ETF, futures, or equity) trades as well.


Suggested (required) Reading

 

The market approach, acumen and technical details presented on this site aren't much different than your senior or graduate level science courses in college. For you to get maximum benefit, you've got to know the material.

 

A good example of this was an experience I had years ago.  I was an upper classmen engineering student at Texas A&M.  I had made it through years of study and could just about see my way to graduation.  That was until my Automatic Control Systems class.

 

It became clear at that point, I really didn't know much at all.  There was still a long way to go.   My visions of great accomplishment were dashed.  All I had really managed to do, was survive the typical weed-out of lesser students.

 

Read more ... 




Three Ten Trading, LLC is structured as a long-short fund implementing proprietary trading strategies as a family office.   

As such, we are not registered by the SEC, do not provide investment advice and do not engage in paid solicitation or advertising.  

This site is for purpose of demonstrating the truth of market behavior; outlined by a market master: Richard D. Wyckoff in his text, Studies In Tape Reading, published 1910. 


Charts produced by TC2000 which is a registered trademark of Worden Brothers, Inc., P.O. Box 1139 Wilmington, NC 28402.

Ph 800-776-4940 or 919-408-0542.  www.Worden.com