Jeff Kohler the Option Addict | Stock and Options Trading

This happens to be the first free moment I have had all day. As I watched the market today, I couldn't help but feel that this is actually more of a positive sign than a negative one. If the market held on to those early losses, I would be a little more concerned than I am right now. Plus for those who attended Mastertalk last night and participated in the trades I presented, congrats. If you were not there, I mentioned the following...

ICE- +$5.21 @ $121.01 (also up another $.80 in after hours)

BIDU- +$3.59 @ $126.00

CTRP- +$1.63 @ $67.21

LEAP- -$0.63 @ $61.64 (not worried yet)

PSA- -$0.74 @ $98.44 (Watch for a re-test of old resistance)

Some other noteworthy trades came from the watchlist earlier in the week (AVB, NKE, VDSI), and a post that filtered in about BLUD. Also keep an eye on GPS...good news today about same store sales.

What are some topics you'd like to cover here in the short term? Leave them as comments if you would. Thanks!

Posted by Option Addict on 1/04/2007 at 3:55 PM | Permalink

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Hi Jeff,

I recently ran across a study called the 4% Model. Can you ellaborate on how this study works and where it originated from?

Posted by Anonymous | 1/04/2007 05:42:00 PM

If you look at RIMM with a line chart, it just broke out of a symetrical triangle today. I see a 10-point target, but it's already made some of its move.

Posted by Debbie Davis | 1/04/2007 08:34:00 PM

Jeff,
Great Mastertalk last night!!
Really brought the whole option pricing (time/voaltility) picture together.

A few months ago you talked about reversals in trend. Might be time to revisit.
Thanks for your time and mentoring.

Bert Hubert
San Antonio

Posted by Anonymous | 1/04/2007 09:01:00 PM

Hi Jeff,

Would you consider GG as a Head and Shoulders pattern that confirmed today with a broken neck line? That's what I see with a diagonal neck line drawn.
Or is it more reliable to draw a horizontal neck line which wouldn't show confirmation till a break below 26?
Thanks!

Valerie Walton

Posted by Anonymous | 1/04/2007 09:27:00 PM

Jeff,

I added to my rules list last week with Lisa's "Never trade when in a hurry"

What do you think about an open post where others can just randomly add their rules? Kind of a free spirit brainstorming session. I think it would help people see a plethora of rules. It may help a new trader get a handle on what others are doing. On the con side though everybody’s rules are a product of their personal tastes and their access to a trading platform so they need to develop over time. It may be a chance for someone to pick up some rules that they haven’t thought of.

Posted by Anonymous | 1/05/2007 05:17:00 AM

Degroodt,

Funny you should mention that particular rule. Here's a parable.

Lisa wakes on Wednesday morning, and despite being on vacation, is looking forward to getting back in the market. It's been 4 days, and she and the market are ready to burst! She turns on her computer, opens up her platforms, and the computer crashes. The clock is ticking down to the opening bell, so she reboots. It crashes, she reboots. It crashes, she reboots, downloads a bios from MSFT, reboots again and this time it works. It's 9:29. Yoooo hooooo!

I lost 3% on Wednesday.

I love your idea of a place to post rules. We're all adults. No one should be making trades based on someone elses rules, but having a resource to look at examples seems like a great place to start!

The next thing to do is to FOLLOW YOUR RULES!! I will from now on. What a wake up call for me.

Posted by Anonymous | 1/05/2007 05:55:00 AM