Good traders focus on entries and exits, discipline, market analysis, risk management and position-sizing in executing a robust trading plan.
But interestingly, many of our subscribers often breathlessly ask,
“What’s on your watchlist”, like THAT’S the holy grail.
Of course, we want to start with trading instruments with good volume, sufficient average price movement, appropriate volatility levels for a given option strategy, and a couple other criteria. This leads to a good GENERAL watch list.
But over time we’ve found specific symbols are better trading vehicles for certain purposes versus others. For example, some are better candidates for:
For example, EBAY is often choppy intraday with smaller timeframes, but in higher timeframes it’s a solid performer for intraweek swing trades. It’s on our short to medium-term swing trade list. Or INTC often stalls out and is range-bound for long periods, making it a perpetual member of our credit spread watchlist.
At PTL we share our regularly updated Sweet Spot Equity list featuring stock and ETF symbols with low share prices, sufficient (but not insane) price movement, and good average trading volume. These are subdivided for intraday-only, swing-trade-only, or either style. We post long and short symbols that represent good candidates for buying puts and calls. Another for selling vertical credit spreads.
So, the next time you think about your watchlist or updating IT (SINGULAR), consider how you trade, and create specific watchlists (PLURAL) and monitor THEM. They’ll match up better with what you’re doing.
12/7/2020 - Possible Swing Trade on the ETF: TLT.
Notes: trading odds enhancer beyond theory & technique is experience & observation, including getting to know a symbol’s tendencies. Sometimes the 21-day EMA is immediate support & resistance for a symbol; sometimes it breaks & very soon later snaps back to it. That is how TLT has behaved since the end of summer 2020.
TLT has been in a slow decline. Periodically, it pokes above the 21d EMA. then quickly drops back below. Here we have a decent daily SZ above the 2ld EMA. So, if price pops up to the yellow SZ, we can have some conﬁdence that price will react as the zone and recent behavior suggests & we should see a profitable down-move. Can trade the ETF itself; or use a long put “to express the trade.”
There are various fears associated with trading. Let’s focus here on “The Fear of Missing Out”, referred to as FOMO.
FOMO takes on two distinct forms:
This brings us to FOMO #2. You’ve got at least a passable trading plan, but you sometimes (or often) ignore it in whole or part:
For your consideration:
There’s a good reason for that…
They are. Give it a try!