Sunday, November 8, 2009


*** This is me trading OEX Options some 18 years ago. Been out of it for a long while and have had to re-learn everything. Takes time! The market has changed also. Back then, it cost me $150 usa to $300 usa just for commissions, versus the $20 round trip commissions of today. Don't remember, but think the SPREAD between BID and ASK prices is wider today, taking up some of that possibilities for profit. A lot of indicators take the place of bar chart reading we used to do back then as well. Though I'm finding those skills are still good and effective. Indicators are lagging and rarely useful in real time trading. The chart bar reading is better and have selected two excellent patterns for trade signals, then backed up by computer indicators, which can warn you of the trend, or potential changes.


Am running about one month behind schedule. Due to the difficulty in getting the internet connection out here in Hillview, in Western Belize. Finally got it. Now we can trade via the internet. To sum it up, have been paper trading and studying since June of this past summer and it is November now. Figure I'm ready and signed up for OPTION HOUSE at the CBOE exchange. This is an electronic trading platform. For the next two months plan to VIRTUAL TRADE, using their FREE trading platform. Come Monday, I will try and get into their setup and learn how to use it. Option House give you a fictitious $5000 account to practice on. Paper trading and real money OEX option trading, or the SPY trading is different when you use real money. I'm hoping the VIRTUAL trading platform will overcome the inhibitions and lag time on MARKET FILLS reality check. As you can get a slide on the prices you want to buy, or sell at. This differentiates between paper trading and real trading. Also I get real time data, so want some practice with that. I've been using BIG CHARTS, which is FREE, but half an hour or more DELAYED data. Okay for learning on, but not so good when you are trying to get FILLS for your orders.
Have given up this week on the DAY TRADING trials. I wanted .50 cents, but the market doesn't move enough to give me that. Sure, the market on a daily bar can show an 8 point OEX move for the day, but most of that is early morning orders that are very volatile occurring in 30 minutes with BUY or SELL on OPEN orders. The prices smooth out and lose the volatility by 10 a.m. The volatility and SPREAD between the bid and ask prices can run .30 cents to .80 cents, or about 2 to 3 OEX points and that has been impossible to accomplish this past week. Was reading about some guy making a $100 a day net, doing several trades a day, just going for .15 cents on the SPY index. Will probably look into the practicalities of that later. I notice last week, the best I could get on BIG CHARTS which is delayed data was .30 cents. Not likely in real time, with real money?
My POSITION trading is working well and since these run a week to three weeks, better suited for my temperament. The plan is to move into a REAL MONEY trading account January, or February. I've chosen OPTION HOUSE as my brokers here in Chicago. A missed .10 cents, or .20 cents is not critical on POSITION TRADING with the slide for bad fills, over a longer time frame, the blogs are reporting on the Chicago Board of Trade Exchange. We'll see how it all works out? I'm kind of working on the premise of attempting to trade with no losses, which requires good market timing directional skills. Think we have that now?

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