Would You Trade It?

It looks like the majority passed on this one. Based on the comments I read, it was for the right reasons. Nice work!

Although if you knew which stock it was, the entry point doesn't matter...it still was an amazing trade. This was one we hit on the Marketcast, and through the watchlist. Give up?


I also would have passed on that same entry point. Some might argue that this is a breakout, and say "I thought you trade breakouts?!" To which I reply that there is a big difference between a breakout, and an uptrending stock making new highs.

FCX is an uptrending stock. It makes higher highs and higher lows. Therefore, it never hesitates at it's prior high to form resistance. If there isn't any resistance, there isn't anything to breakout of. Here is an example of a breakout...

I bet you know where I'm going...


The resistance is there, the volume is there... that is what we call a breakout.

Don't you love it when you take a boring, low volatility stock like this in the early stages, and it makes the NYSE top ten list?! Nevermind that though... analyze that chart. It is textbook of everything I teach about the strategy.

You take the trade on the breakout, everything signals perfectly, and you are in. Nice work!

The next day, you are getting killed on the trade. No profits, and a huge loss to start off the day. You get emotional. In fact, some sell thinking that the trade is wrong. However, notice on that second day, the sellers could only take the price back down to where it broke out of. They know that is as good as it will get, and they cover their short...while the rest of the market is buying. As you can see, the end result is awesome. There is no way to predict a day like today, but the stock is sitting beyond it's target price of $102. The hardest thing to do now is to decide whether or not to get greedy.

Recommendation: Get greedy

Long: Trading after a good weekend

Short: Monday's

Hows it going Jeff,

I remember you making a post about phone conferences and I wanted to let you know that I have tried this with a group before and it did not work out well at all. We had a group of only 4 and it was hard to understand everyone because we kept speaking over each other and sometimes the signal was really choppy. You probably have a better system cooked up but I thought I'd just let you know. Also, I was thinking it would be a pretty cool idea for us to maybe have some sort of stock portfolio contest amongst ourselves. I know there are sites out there that are free that can track everything. We could all throw in something for the winner or maybe an OA t-shirt. Talk to you later and thanks for the awesome post today - great movie!

Thanks for the video refresher! (And thanks for the Clean Cups call too!)

I've been a swing trader because I think it fits my personality (I have the patience of a fruitfly) and with trades like GRMN I wish I could have had the patience (greed?) to stay longer. I have had other successful swing trades where had I stayed I would have given it all back. I think this is something I need to work out for myself. I don't think any one style is Wrong or Right.

Speaking of swing trades. I swing traded CME 3 times in the last couple of months. Just took another trade on it. It is going into new territory.


I too think I am a swing trade, but also working on not calling the tops, but moving the stops (or exit points). I am a work in progress.

I entered BSCI on July 9th...loving it!

Thanks for your list of "6 month movers". I found BSCI in that list. I have also weeded through my watchlist and took out those stocks that didn't fit the formula. I am experiencing more success. Thanks for your posts.

Stupid question, on ETN you would take profits on first sign of weaknes? I like to see what you would teach on this aspect.

Also MTW breaking out

Thanks for the "Clean Cups" call. I find it very helpful, but for some bizarre reason also find it kind of "naughty." Don't know why.

My GRMN calls are now up another 100% today... whoooeeee!!! But to temper that, my ZOLT call is down $0.85 while the stock is only down $0.36. Where do you find an option with a delta of 2.5?

_____________________NEWS FLASH!!! ________________________

I know we don't look at our portfolio totals, but if my gains for today stay where they are... Catherine and I will be announcing the birth of our own re-birth.... we will finally hit our pre- 27/02 portfolio amount. We lost almost exactly (I know, I know... it's either exactly or it's almost... you just can't have "almost exactly" or the universe will implode... but trust me, it was very nearly exactly) 50% in that trainwreck, and since then we are up 100%. Actually a bit more. 102% as of this minute. It probably seems like a silly thing... but to us it's huge.

Too bad I'm out of town for the next 3 1/2 days or there'd be Margharitta juice all over the place!!!

Hi Jeff,

Thanks for the post-helps a lot!

One observation on ETN - that last great move evidently occurred after earnings. I would have missed it as I do not yet have the courage to hold through earnings.

Hi all,

I am a trend trader. I find being a trender is simple and matter of fact. I still experience emotion, but emotion does not effect my decisions. I used to try to pick tops....only to find frustration (emotion).

For me, I am not forced to stare at my computer screen all day long (prior to realizing that I would trade trends, I felt like I could not leave the computer). Now, towards the end of each trading day, I check my positions, and if the trend is in tact, leave the trade alone, if not, exit. Very simple (for me).

Hope this makes sense. Thanks for listening.

LZ is starting to show some life.

so on ETN what is the consensus, after such a huge move you just let it run? the volume is great.

AMG - making a nice move off support today. Jumped on it earlier this morning.

MHK - I like this for 2 reasons - bounce off support and possible asc. tri breakout (soon). Watch out for the option spreads on this though - some of them are way out there and I don't understand why. August seems reasonable but the others are wacko.


Thanks to one of you guys for mentioning BTU. It is nice and red in this sea of green.

Wow, that's excellent. Congrats.

Had to exit my LVS put. It has broken its support, and sold 1/2 of my KIM. Still holding REG, although, I need to re-evaluate it.


ETN, Love it!
Gapped above $100 on earnings. Trend is obviously intact. Unsure of how you are positioned sized? I think some people may take 1/2 positions off the table ($7 price target has been hit). I think others will see if it retests $100 and holds.
Great pick nontheless


Thanks for sharing your trading style. I am also working on being a trend trader. I find that I have to give back some of my profit to make even more.
However, I am still glued to the computer all day because I am trying to learn to daytrade options on the SPX. Still papertrading right now. I am trying to combine Josh Black's 3 MA system with Stacey Acevedo's system using the Market Forecast. I found that the 3 MA system got me into trades too late. I wish Investools taught Daytrading. If anyone has a good system, please e-mail me at judymacfarland@yahoo.com. Thanks.

Thanks for the comeback.

David, (ETN)
I am in it, and am going to watch it play out, hopefully it goes higher (it is OK to hopeful on winners....and not cut them to short). If it retests $100, we will evaluate then.


BTU was a beauty, wasn't it? Another textbook pattern & profit.

Nice trade,


I'm not saying that JCP and KWK look like great put plays here, but I wouldn't be long to save my life.

he he.

With ETN, use the magic benjamin mark ($100) as a mental stop. I haven't sold any yet, but a break below 100- position sold.


Are you wanting to daytrade options?


On MHK, are you looking to play this over earnings (which are in a few days) or are you looking at a short swing trade?

Jon P.
OC, Oregon

Jeff, Only on the SPX.

Look at the flag pattern on CTRP. Look at today's candle and the volume already. If this one breaks over $87, it's gone baby gone.


Buyer or seller?


I'll be interested to know what you think about REG at the end of the day. My put has suddenly dropped by 50% today ($1.35) even though the stock is only down $0.50. There's another one that's got a delta of 2.5 What's going on here? Anyway, I think it's broken it's trend today if it keeps this gain. Unfortunately I've gotta head out to Vancouver now, so I'll be off the air until 3:00AM (EDT) I'll see where it's at tomorrow morning, and make my decision then.

Nice to hear from ya. I am in BTU also. One of my few puts that is doing okay. SBUX still intact, too.
But I don't mind a few gone astray puts if the bulls keep going.

RTP, what say you?


I entered LCC on 7/12 as a bounce off of horizontal resistance. I plan to exit with a close above 36.05. I am curious as to whether anyone else sees consolidation for a bullish move.




Stacey Acevedo taught a class on buying calls and puts on the OEX and SPX at the Las Vegas Conference in March 2006. This is what I am trying to learn.

Daytrading options (as a buyer) is a very tough strategy. The markets are quite volatile and volatility contracts/expands. Even with a concrete system, there is limited profit potential involved. What draws you towards this strategy?

I forgot to mention - Acevedo said that she could be in the trade a few seconds or hours or up to 4 days -never over the wk-end.

I think that daytrading can be profitable when the broad market is trending. I have heard you mention this on the Cast. How do you daytrade at such times?

Daytrading in a trending market is crazy. I can see doing it when the market is range-bound, but why miss a larger move to pick up small chunks?

Doesn't make sense to me.

I understand she wouldn't hold over a weekend...that would be weektrading. You'd settle at the end of each day, but imagine trading the SPX. A huge move would be 10 points...but the average is 2-4$ moves in the index. Think of that small reward, and how much you'd need to risk. ITM options are very expensive on an index. If she were in a position for only a few minutes...that would be hundreds of thousands risked for maybe a $10,000 reward.

I like the idea of daytrading stocks because they move during the day. The right stocks make 5-10 PERCENT moves, which you won't see in an index.

A days trend in a stock is much better than an index. In my humble opinion. I only hoped she talked about the riskas well instead of just flashing dollar signs at you.


Thanks for your input. I have her lecture on CD-perhaps you have access to it as well. As a beginner, I don't know what works and what doesn't. I listen to all the IV instructors but I don't have the experience that you have of discernment. I know that you have helped my trading tremendously and if you don't recommend that strategy, that's good enough for me.
However, I would like to hear what strategy you use when you daytrade. Perhaps you can share this with us sometime on Master Talk. Again, thanks for your help.


Day trading with options is difficult at best. The trading that Stacy does has a very high risk to reward and she has the experience to do these.

If you want to work at day trading how about using qqqq (not its options but the etf it self) and then test your system. You need to get better at entry and exits at the fast pace of day trading before you add the complexity of Options to it.

Just my .02c



I'd love to. I will try to plan for this on a future MT or an OA teleconference :)

TSL having a rough one today.
Planning on exiting on a close below 68.7, but also thinking about Jeff's comments last week on MLM (I think) in a similar situation where he asked why wait until the end of the day when a position is taking such a beating.


Brett, I bought CTRP on the 7/12 candle with a stop at 82.25. I thought it was taking off then. But I see what you mean. Todays action could not drive it lower. I bought Sept's so we'll see what happens.



Day trading the SPX, is very difficult. I traded Staceys simple system for a short time and discovered that the win loss is significantly negative.

If you want to move forward with this try the mini SPX or SPY's. In any case you will find that Stacey's system is oversimplified for what you really need to be succesful.

Happy Trading,


There's a new Thong in town...oh...and a new post...!

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About me

  • I'm Option Addict
  • From Saratoga Springs, Utah, United States
  • I am a professional trader and an instructor for Investools. I've had relations with the markets for 9 years. Born in Concord, CA, but reside in Saratoga Springs, Utah. Father of THREE, Husband of one.
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