Thanks Tom. It's quite helpful to know where a 5th entry would have been. My main trading strategy is to sell out-of-the-money options on the ES futures. The "system" is a factor to help decide when to roll the options and how far out-of-money to choose the strikes.

.....Susan

Is today a buy signal for that system, or are you supposed to wait till it crosses up above 10 again?

Thank you Brophy, seems to me that's pretty significant info.

.....Susan

Hi Zach06

Just curious - Were those puts at-the-money? out-of-the-money? In-the-money? You have the price but not the strike and I don't have the quotes to compare. Thanks,

.....Susan

Hi GGN

I think almost all equity options are American style which means yes it's possible that you can be assigned. But it's not really a problem. The easiest way to prevent this is simply to make sure that your short calls are out-of-the-money.  If not, then just watch to make sure there's still some premium (time value or extrinsic value) on the calls.

Dividends shouldn't make any difference. A stock may lose some value when it goes ex-dividend but then the call's strike price would be that much more out-of-the-money, so less risk of being assigned.

Me neither - first time I've ever had problem w sound. I thought it was just the poor reception here at work. Actually I shouldn't even be looking at my laptop so much at work anyway. :-)) fyi I'm using windows 7.

.....Susan

Hi Matt
Thanks for all the extra effort you (and Steve and Tom) continue to put into this site. I thought it might be a good idea to put together a list of your "things to watch" which you mention from time to time. One thing you mention on this video, which you have mentioned before, is that when the 60 stochastics stays above 80% all day, that's a possible sell signal. Is that just something to watch on the 5-min chart? or other time intervals as well?
.....Susan

December 2011 ended around spx 1300. So adding 16% onto that means that Dec 2012 would end around 1500!

Jim I agree to lower bets during a losing streak. But not so sure about waiting for the last entry for a big bet.
Something I remember from a lecture long time ago:
Suppose there's a penny toss, and you win $2 every time it shows heads, and you lose only $1 every time it shows tails. If you were allowed unlimited play, of course with that edge, the more you played the more you'd win.
BUT if you were allowed only a few tosses - say 5 - those few tosses might very well turn out to be the time the penny shows tails 5 times in a row. It happens.
We have unlimited play with this system and it has an edge - so just keep our bets small and keep playing and eventually we'll come out ahead.

.....Susan

What a nice video - informative and heartfelt. Tom thanks for reposting it - I only vaguely remembered it. Too much multitasking makes me forgetful! :-)

....Susan

Exactly - it's such a relief to have one less thing to make decisions about. My other positions are complicated enough!

What you say makes sense. The system doesn't know about politics and world events. Probably not about Elliottwave either.  I don't know if it knows about seasonality either, maybe it does.

For me, it's just easier to follow the system than to try to second guess it. Several times I've used my own discretion, with mixed results. Last couple of times, I ended up with the same results as the system's results (after jumping in and out a few times) but I sure had to work a lot harder for those same results.

Finally I decided, why not just allot a certain amount of my capital to the system. Then allot another amount of my capital to my own discretionary trading. So much easier.

.....Sooz

Thanks Kalinm. Food for thought.

...taken the signal earlier as a daytrade. Coulda jumped in long somewhere slightly above 138.44, with a stop at 138.44, and a target of 139.61. I know it's not the official system, but still coulda. :-)

.....Sooz

Vix help

Actually I'm just trying to figure out how to post a link. Hope this works!

Thanks Matt,

It's always helpful to have an idea what this system is "thinking".

.....Susan

Thanks for that chart Zack06. I see it goes back 6 months since Sept 1st 2011, and this is the first time on the chart that the Money Flow has diverged so negatively. I'm curious what were the other times like? ie What other times (even earlier than 6 months ago) was there a similar divergence and what happened then? And if the SPY did eventually follow the MF and drop, what was the time lag those other times?

.....Sooz

Hey congrats Ascr, it's so nice when mistakes turn out in your favour!

That's a very nice DOM. My brokerage only supplies the bids and asks for 5 ticks above and 5 below the market. Looks like yours shows them all! And I've never seen volume-by-price bars as part of the DOM! Is that tradestation?

Of course if I had all that info, I wouldn't know what to do with it anyway.

.....Susan

Marie I know just how you feel. In spite of all my declarations that the statistics make sense, I still haven't decided whether to pull the trigger at today's close or not.

Of course this fear means we're betting too much. The bet size should be small enough that we don't care. :-)  It's all about trading psychology. Easier said...

.....Susan