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Options are still one of the most misunderstood opportunities.
They’re too hard. They’re far too expensive. You have to be rich to trade them. Those are just some of the excuses I’ve heard over the last 20 years. But to be very honest with you those excuses are laughable.
I love when traders tell me technical analysis doesn’t work.
While they’re entitled to be wrong, the fact remains that technical analysis does work, sometimes by up to 80% of the time. Granted, there is no Holy Grail, but if we use the right indicators, we increase our odds of success. Especially if we apply those indicators to well known stocks that may only be down temporarily.
All of a sudden, there’s a gap in the chart of your favorite stock.
Surprise news, earnings, something unexpected caused a bout of extreme optimism or pessimism that resulted in the move.
The Parabolic Stop and Reverse (SAR), commonly known as Parabolic SAR is a trend following indicator that highlights current price direction.
It also provides entry and exit signals as well with dotted lines.
It is essential that you’re well aware of support and resistance points.
If not, you could be setting yourself up for abysmal failure.
Support represents the moment when buying begins to overwhelm selling and prices begin to bounce back. Resistance represents the moment when selling begins to overwhelm buying and prices begin to pivot.