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San Diego, CA Seminar : Trading Earnings and Weeklies Using Debit Spreads (June 13 -17, 2016)

I will be holding a seminar in San Diego, CA from June 13th – June 17th, 2016 (Monday – Friday) on how to trade Earnings and Weeklies using Debit Spreads. The strategies being discussed and trading are the Neutral Calendar Spread, the Double Neutral Calendar Spread (a synthetic Strangle), Reverse Iron Condor, and Straddles/Strangles.

The cost of the seminar is $799.00 and includes a three (3) month subscription to my Trading Forum (where all earnings and weekly trades are posted) and to my Skype chatroom.

These strategies are neutral-based in that there is no preference for a specific direction a stock moves post-earnings. I have been trading these for many years and have also taught many other traders how to use these profitable strategies.

The Neutral Calendar Spread in particular is a great strategy that can be placed at a minimal cost and brings a very high return on investment. This strategy takes advantage of high Implied Volatility (over-priced options), a lack of a big price move ( it still has wide break-even points), and time-decay. For whatever reason, this strategy is under-used by many traders. During the seminar, I will be teaching this strategy in-depth and what to look for when spotting potential trades. I will also show when it is best to avoid this strategy for earnings an earnings trade. The Neutral Calendar Spread also hold value very well even if the stock moves more than expected post-earnings. For those who cannot trade full-time, this strategy does not require a lot of time management, as companies report earnings either before the markets open or after they close, so it is very easy to set your price to close the trade out well ahead of the bell.

The Reverse Iron Condor is different than the Neutral Calendar Spread in that it does require a stock/security to to make a pre-determined price move, up or down. Choosing the right strike prices is crucial to the success of this strategy. Strike price increments available on a specific security are also very important when using this strategy. What I like about this strategy is it is a lot less expensive to place than the Straddle or Strangle and requires less movement. The potential gains are capped, however, and known at he time of placement. On the same hand, once the security moves past the required strike price(s) to gain maximum return on investment, it can immediately be closed out. I also like to trade this strategy with securities that have weekly options, such as Citigroup (C) and the SPDR Gold Shares (GLD), among others.

The Straddle and Strangle are strategies that require a large price move to profit. A Straddle is when you buy both call and put options with at-the-money strike prices. The Strangle is buying both calls and puts with out-of-the-money strike prices. The benefits of these strategies is that there is unlimited profit potential on the call side and a high profit potential on the put side. When accurately predicting a large price move on the Straddle or Strangle, the ROI can be very significant. The drawbacks of using these strategies is that they are generally a lot more expensive to place than the Neutral Calendar Spread or the Reverse Iron Condor. If you place a Straddle, for example, and the stock fails to move much post-earnings, you will be looking at a significant loss. This is why I prefer to buy longer term expiration dates to give the trade plenty of time to make the necessary move to profit in case it initially does not. While you will pay more for this time-value, I look at it as a security blanket. Using weekly options with the Straddle or Strangle is very risky. Another strategy I use is called the Double Neutral Calendar Spread, which is similar to the Strangle, but can be placed at a fraction of the price. It requires buying two (2) Neutral Calendar Spreads, a call side and a put side, both using out-of-the money strike prices. The strategy is very unique, and while there aren’t a lot of opportunities to trade it, when there are this strategy works great.

The seminar will go into great detail on all of these strategies and we will be trading them live. I guarantee you will leave the seminar with full knowledge on how to trade them successfully. After the seminar, you will have full access to the Trading Forum and my Skype chatroom where I answer any questions you may have throughout the day.

The seminar starts at 5:45 am Pacific Time on Monday, June 13th, 2016 and will meet each day throughout the week at the same time each morning until Friday, June 17, 2016. Each day, the seminar will last until 2:00 pm Pacific Time.. I will be catering breakfast Monday through Friday.

Once registered, I will promptly e-mail you a receipt of payment and for admission to the seminar.

The seminar will be held at the San Diego Convention Center:

111 West Harbor Drive, San Diego, CA 92101

http://visitsandiego.com/

If you have any questions, you can contact me anytime at kmob79@gmail.com

Free Earnings Trade of the Week: Red Hat, Inc. (RHT) – Reports After The Markets Close On Tuesday, 3/22/16

Red Hat, Inc. (RHT) is scheduled to report earnings after the markets close on Tuesday, 3/22/16.

Last quarter, the stock had the following price movement after reporting earnings:

Dec 18, 2015

83.01
83.99
80.45
81.40
7,692,400
81.40

Dec 17, 2015

78.81
79.34
77.66
78.86
2,688,600
78.86

(RHT) can be very unpredictable in terms of price movement post-earnings. A few keys to picking a strategy to use is the amount of movement allowed (up or down), strike price increments available, and the cost to place the trade. On this specific (RHT) trade, I think the Neutral Calendar Spread strategy is the right way to play this trade. The break-even points are very wide, and the price is very good. Even if the stock moves $5.00 + or more either way tomorrow, this trade will still do well and hold value even if it moves more than that, so I consider this trade very low risk with great potential. 9.5/10.

Note: I recommend placing this trade as soon as possible, as the value will most likely increase throughout the day. There is a possibility that the trade can be closed out for a profit by the end of the day if filled early. I will post that at the end of the trade details.

Here is how the trade is placed:

Entered Trade

Sell -25 RHT Apr16 75 Call

Buy 25 RHT May16 75 Call


Requirements

Cost/Proceeds
$1,875.00
Option Requirement
$0.00
Total Requirements
$1,875.00
Estimated Commission
$75.00

NBBO
0.40 – 1.10. Try to pay 0.75 or less for this trade. At a maximum, pay up to 0.85 if late.

If there is an opportunity to close out the trade early (taking less profit) if your order is filled at 0.80 or less, place the closing order out at 1.25 as a day order only.

I will post the price to close this order out tomorrow pre-market, right before the opening bell
RHT NCS 32216
See the attachment for the profit/loss chart.

Update 1: 9:25 am EST: Pre-market, the stock is down about $2.50/share, so using the Neutral Calendar Spread strategy looks very good here. I am placing the price to close the trade out at 1.90 for now. I will update any changes here, if needed.

Update 2: 1:05 pm EST. This trade is looking excellent right now. Time-decay and the current movement is going to increase value quickly. The price to close the trade out is still at $1.90.

Daily Options Trading Strategy (DOTS) Updated List – 3/11/16

Here is the current (4) tier list of the Daily Options Trading Strategy (DOTS), current as of 3/11/16:

Tier 1: AAPL, AMZN, BIDU, FB, GOOGL, LNKD, NFLX, PCLN, TSLA


Tier 2: BA, BABA, TWTR, FIT, UA, CRM, GPRO, C, FDX

Tier 3: BBY, EBAY, STZ, EXPE, CMG, AKAM, DIS, BWLD, PYPL

Tier 4: HD, IBM, MNST, ULTA, SQ, CAT, PX, GDDY, UPS

If you have any questions about the strategy or stock options in general, you can e-mail me anytime at kmob79@gmail.com

A Look Ahead To Earnings Next Week, 3/14/16 – 3/18/16

Next week provides plenty of opportunities with earnings trades. Among the companies reporting are the following stocks I will be looking to trade:

Monday: JMBA

Tuesday: PLCE, DSW, FDS, JASO, ORCL

Wednesday: ATU, CMCM, CLC, FDX, GES, JBL

Thursday: ADBE

Friday: TIF

Trading In Volatile and Down Market Days Using the Daily Options Trading Strategy (DOTS)

I am often asked how I trade in market conditions that are unpredictable and volatile, especially down markets? My answer is simple: I really do not care what the markets are doing in terms of direction when using the Daily Options Trading Strategy (DOTS). When I check pre-market news and the futures data, I actually prefer to see the markets open down. This is usually a good sign that there will be some early call option trades that are quick in and outs.

Some investors and traders tend to flee and sell their long call or stock positions when they see the markets moving the way they are lately. I see opportunities. THE DOTS strategy has a resiliency and rigor to it that is unique. Just by looking at the trade log on my website, http://kevinmobrien.com/?page_id=480, you will see that most of the trades made are call positions. This was also the case in 2008 and 2009, my best years ever trading the DOTS. It would seem that buying puts would have been the way to go then, but not using the DOTS. Even on a stock like Citigroup (C) and other financial related securities in 2008/2009, which were falling precipitously daily, the DOTS still provided plenty of call buying opportunities daily. The way the strategy is structured, with the Bollinger Bands and the bottom 4 indicators (the Relative Strength Index, the Intraday Momentum Index, the Money Flow Index, and the Full Stochastic Oscillator, with the settings and parameters I use for each) prove to be very adept at spotting true lows daily in a given security. In fact, put trades were very rare during that time, and they still are now.

The settings used for each indicator are crucial to the success of the strategy. When I began developing the strategy, I went through every setting possible with each indicator in tandem. What I use now is the way to best use this strategy and has held up so well after all these years, under every market condition. From trading after the post September 11th attacks, the mortgage crisis and the banks, Greece and the Eurozone problems, oil fluctuations, and now with the current volatility daily. The bottom line is that the strategy works.

This strategy keeps the emotion out of trades. This is a very important aspect of it. It also requires patience and discipline. My point of this post is to not stop trading because of how the current market landscape is or what it will be in the future.

Like any trading strategy, repetition only expedites and enhances the ability to spot great trading opportunities. This is especially true when understanding the Bollinger Bands when using the Daily Options Trading Strategy. The bottom four indicators (the RSI, IMI, MFI, and the FSO) are static, in that once their respective buy points are reached, there is nothing else to look for on them. The Bollinger Bands are the most important element of the strategy. They provide a trader with great insight into the future movement of the stock and the volatility. The Bollinger Bands also show when to avoid a a trade, which is extremely important. If anyone is interested in a PDF file of my book on Bollinger Bands for free, you can e-mail me at: kmob79@gmail.com. . For day trading purposes using the DOTS, I prefer the settings as shown below:

BB 21716

TWTR DOTS 21716

One of the benefits of my subscription service is that I do all of the work for you ahead of each trade. Before each possible trade, I post the ticker symbol, the strike price, expiration, and my sell-to-close (STC) price ahead of each trade. I do all of the necessary “homework” before hand: checking any news that may be related to the stock, the daily highs and lows, the bid/ask prices, and the daily volume. My subscription service is not just an e-mail that tells you what to trade when it is far too late. This is real-time live trading, with me on Skype and Chatzy from 8:00 am EST until the markets close, and later. Along with the trades, I am always answering questions that any subscriber may have. I have a policy that if you are not happy with the service after one full week of trading, I will refund your subscription with no questions asked whatsoever.

If you have any questions about the daily strategy, the subscription, or any general questions about trading, please e-mail me anytime at: kmob79@gmail.com.

-K

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