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Showing results for tags 'tech analysis'.
Found 12 results
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The Asian tail can be likened to the option market's equivalent of the stop loss in forex.
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If a trader has 2 options contracts that are valued at a strike price of $5, then the aggregate exercise price is $5 X 200 units = $1,000. Usually the calculation does not include any premiums received or incurred on the trade.
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Whenever certain adjustments are made to an underlying asset such as a stock split or a share recontruction, the strike price of the options contract must be adjusted to reflect the new reality. Furthermore, coupon rates on Gannie May mortgages differ from the benchmark rate. Therefore the strike price must be adjusted so that the investor can receive the same returns on them. The term may also refer to the strike price of a security following adjustment for stock splits.
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It is an exotic option which is more complex than simple vanilla options, taking several factors into consideration for the trader to be able to make the decision after the option has been purchased rather than at the time the option was purchased.
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The zero coupon swap has several variations. Some are structured in such a way that the fixed lump sum is paid at the commencement of the contract, while others may be structured so that there is an option to convert the lump sum payment on the fixed arm into instalmental payments over the life of the contract. The objectives of the parties in the swap deal determine how the deal is structured.
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WTI is also known as Texas light sweet crude oil.
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What the wild card play does is to allow the seller of an option the opportunity to deliver the option for a given amount of time after the exchange is closed for trading, but still using the last price that the option traded at. This means that even when there is a price change between closing and actual delivery, the seller can still deliver at the closing price.
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This option is used by traders who are short on a Treasury note future to deliver the asset after the price of settlement has been known, to permit them to make more informed decisions so as to maximize profit on the sale of the option.This is an option which confers on a selling party of a Treasuries futures option, the right to give a notice at 8pm Chicago time, of an intent to delay the delivery of the Treasury option until after the exchange on which that future was trading has closed for the day, by which time the settlement price has been fixed.
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WARFs are usually used to calculate credit ratings on collateralized debt obligations (CDO) instruments, and are used to assess the chance of default on the underlying debt that the CDO instruments are based on, and so give a clue as to the investment-worthiness of the portfolio being measured.
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The wave pattern is the basis of the use of the Elliot Wave indicator in technical analysis. Using wave patterns for trading enables a trader to buy on the dips and sell the rallies. In other words, a trader can buy at the end of a downwave and sell at the top of a wave crest. If the price depiction on a chart is done in the form of a line chart, we see that the price movement of the asset is not in a straight line but rather in a succession of crests and troughs as the market flows and ebbs, just like we see in an ocean wave being ridden on by surfers.
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Good Morning All: If you are an experienced trader, you can skip reading this article. If you are new, or if you have been at this less than a year and not making money yet, you may want to read this. If you have been at it more than a year and are not making money, you probably will not read this. To a Handful of Traders Out There I have to accept the fact that there are very few people willing to recognize in the early stages of trading that they need an education. It should seem obvious, as it is the only acceptable route in any other high-paying profession. While I have to accept that fact, I do not really understand it. Having excepted it, I know that the next best thing we can do at Pristine is to make sure people stay under our wing until they are ready to advance their careers through a proper education. We want to make sure that you stay with us even if you have not yet made a commitment to be a full or part-time trader, or to manage your own long-term money. To do that we want to continuously improve you and your knowledge by offering a variety of ways to obtain great information for free. Every 6 to 8 weeks we do a seminar called "Online Trading Essentials". There is a nominal charge for it but if you are currently a Pristine student you can get it for free. If you are in the process of discussing a seminar with a counselor, you may also be able to get it free. Talk to your counselor. It is a great class that delivers four and a half hours of nonstop critical information about many of the topics that traders need to know about trading. Everything from advanced concepts about risk management and share sizing, down to what a level II screen is for, and how to use news and/or fundamental analysis in your trading. This is all information that is critical to know, yet on the other hand is too basic to actually be taught in our paid for seminars as they focus purely on technical or more advanced topics. In addition, we are introducing a new series of "Power Trading Workshops" that are designed to deliver more information and they come to you Monday through Thursday (some weeks may only be three days) at 4.15, just after the market closes. Some of these will have new topics that have not been discussed, and some will blend some old favorites and new twists. Naturally, we still have new people who want to know about Pristine and about some of what we teach, and that will be included in some of the topics as well. You can view the schedule for these on our homepage or in the e-mails that you receive. They are under the topic of either "Power Trading Workshops", or "Free Webinars". Paul Lange Vice President of Services Pristine Capital Holdings, Inc.
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In the Chart of the Week (COTW) dated Monday 9/17/12, I showed you why a short-term correction was near. This was regardless of the bearish October Phenomenon. As I said then, the time of year alone is not a reliable guide without other factors being in alignment. Those factors are - the right price action and speculative bets being placed on higher prices. In that COTW I showed that this was happening and it virtually insured a short-term correction was close. As we know now, Friday 9/14/12 was the high day of the current move. If you would like a copy of that COTW you can e-mail me at greg@pristine.com or e-mail counselor@pristine.com for it and it will be sent to you. In the chart above, the S&P 500 is displayed by the ETF symbol SPY. The bulls attempted to hold the prior low in the 143 area of SPY last week, but could not. With an area of Major Support (MS) in the 140 area, it's an obvious place to except a bounce from. Ideally, prices would drop straight down into it similar as they did from early last week. This would create a small Pristine Price Void (PPV) for prices to bounce up into. Assuming we see this setup, I would not play this as a swing trading long. Meaning, I will not hold for a few days, since what is needed for a bottom is not yet in place. Rather I'll use the area as a reference point where the intra-day time frame will bottom and start a short-term uptrend. Historically, correction bottoms do not occur without the majority convinced that the market is going lower and they make speculative bets on that. We are not seeing that yet based those option traders that are typically on wrong side near turning points. These are the under-capitalized, overly-emotional traders that bet big at the worst time. I've used their actions at a guide for many years and they rarely fail to signal when the turn is near. When these traders start loading the boat with put options (bearish bets) the odds are that a tradable low will not be far off. Lastly, let's look at the NASDAQ 100 index ETF symbol QQQ In the above chart is a Head & Shoulders pattern that formed in the NASDAQ 100 ETF symbol QQQ. The pattern is simply a new high that has failed (longs are caught) and break of prior support. I typically don't show or talk about the esoteric types of analysis that I studied in the past. However, I thought I would show this and how it aligns with the simple technique taught at Pristine. The Head & Shoulders top theory is that the vertical length of the area between the head of the pattern and the neckline (the base) will give you the point where prices will decline to by projecting the same length below the base. In the chart, you can see that I've drawn a line from the head to the base and then placed a line of equal length from the base going lower. That is where prices should decline to. Well, based on the simple analysis of what was resistance becomes support, we see that the Minor Support (mS) area is the same as the measured low projection. I studied this many times years ago and it was virtually always the same. The projection lined up with an area of price support; it could be a minor or major area. The other lines below are simply other price support reference points to be aware of should the decline continue lower. Complex analysis tends to impress us when starting to learn about trading based on technical analysis. We are conditioned to think that the markets are complex and it's needed. Most online trading courses are based on this type of analysis. If you have to buy software or indicators to trade be wary of such education. If your charts of filled with things like indicators, wave counts, Fibonacci projections, etc. The only thing you can be sure of is that the confusion will continue. All the best, Greg Capra President & CEO Pristine Capital Holdings, Inc.
