Traders' Library Blog

Stocata S&P 500 Analysis: September 23, 2017.

Last week I wrote: "Sorry I could not make comments last week. Two weeks ago I expected the gap around 2460 to be filled and that was the case. On the other hand I saw room for a further move up. This happened the past week with a gap and large move on Monday (9/11) and another gap on Tuesday. Price is now at the R1 pivot resistance, the 161.8% Fibonacci target and the upper side of the volatility channel while, the index is far away from the averages. Note the negative divergences between price with higher tops and the lower tops in the stochastic RSI indicator. I expect a pullback for closing the recent gaps, possibly after some small further up move. Read my comments on the weekly chart and monthly chart  for more information regarding the longer term view."

The index went a few points up Monday till Wednesday but, back down Thursday and Friday, closing just a few points higher compared to the week before. The index now reached the 161.8% Fibonacci target projected over the last wave down of the last correction wave. The candle chart is showing a doji, hanging man and evening star pattern, all negative signs. The stochastic oscillator is showing a downward move compared to the upward move in price over the last few days, a negative divergence. The index is back at the R1 pivot resistance , the 161.8% Fibonacci resistance, the upper side of the volatility channel, indicators are topping and price is far away from all averages. Furthermore there are two gaps I expect to be filled. Logically we should expect a reversal with a further downward move the coming week(s). First targets are filling the gaps. Read my comments on the weekly chart and monthly chart  for more information regarding the longer term view.

Sylvain Vervoort   http://stocata.org/

What You Should NOT Do Trading Options!

I was doing one of my webinars and I got this question:

 

“ I owned a call and the price of the stock went up but my option price went down! I hate options!”

 

I get this question all the time.

 

Here’s the problem that so many option traders do and cause pain and losing money: They don’t understand what makes options move!

 

There are many great reasons to trade options, I gave some a couple of days ago. (You can read it here.) So I am a big fan of options. I actually like them more than stocks!

 

So you should NEVER trade options without understanding what moves options.

 

That means that you should understand the Greeks. They are delta, gamma, theta, and vega. These concepts often intimidate people so they never learn them. They look intimidating but really aren’t.

 

They are the key to understanding why options move the way they do. Understanding the Greeks will tell you about how much money you will make or lose when you trade options.

 

Trading options without understanding the Greeks is like trading with a blindfold on.

 

It’s easy to learn the Greeks!

 

There is a lot of info for free on the Internet. Or, better yet, you can take our amazing upcoming live seminar, Options Success School. Click here to claim your discounted ticket!

 

Stocata S&P 500 Analysis: September 16, 2017.

Last week I wrote: "Predicting the coming week with the daily chart looks a bit contradictory compared to the weekly chart. Here there is room for a limited further up move. On the other hand there is a nearby gap to fill around 2460. Before that happens there may be another higher high. It may take more than a week before we see another start of a down correction. Read my comments on the weekly chart and monthly chart  for more information regarding the longer term view."

Sorry I could not make comments last week. Two weeks ago I expected the gap around 2460 to be filled and that was the case. On the other hand I saw room for a further move up. This happened the past week with a gap and large move on Monday (9/11) and another gap on Tuesday. Price is now at the R1 pivot resistance, the 161.8% Fibonacci target and the upper side of the volatility channel while, the index is far away from the averages. Note the negative divergences between price with higher tops and the lower tops in the stochastic RSI indicator. I expect a pullback for closing the recent gaps, possibly after some small further up move. Read my comments on the weekly chart and monthly chart  for more information regarding the longer term view.

Sylvain Vervoort   http://stocata.org/

Stocata S&P 500 Analysis: September 2, 2017.

Last week I wrote: "As expected last week, price went a fraction lower on Monday, touching the 100-day simple moving average dynamic support. Tuesday the up retrace started with a price gap and went up to a 50% pullback, a price resistance and the PP pivot level of the month. Most probably the index made the top of the correction and resumes the down move. The next down target is the S2 pivot support at around 2380. I assume this will take a couple of weeks. Read my comments on the weekly chart and monthly chart  for more information regarding the longer term view."

Predicting the coming week with the daily chart looks a bit contradictory compared to the weekly chart. Here there is room for a limited further up move. On the other hand there is a nearby gap to fill around 2460. Before that happens there may be another higher high. It may take more than a week before we see another start of a down correction. Read my comments on the weekly chart and monthly chart  for more information regarding the longer term view. Yours for free: Elliott Wave International, a pioneer in technical market forecasting since 1979, has just released a free report from its team of market veterans, "5 Markets Ready to Move Before Year-End."

Sylvain Vervoort  http://stocata.org/