Use Stock Chart Analysis for Options
Options Trading has suddenly become far more popular with Professional Traders and Smaller Funds who are now learning to trade Options. This means that Retail Traders will find more trading volume and opportunities than what have been around previously. It is the Renaissance of Options Trading, and what Professional Traders want now more than anything is Stock Chart Analysis Training for Options.
The Professional Traders realize that the secret to successful Options Trading has more to do with selecting the right stock to trade, than choosing what Options Strategy to use. They are learning Technical Analysis for the stocks they are considering for their Options Trading.
Professional Options Traders need to learn how to recognize and interpret the new technical candlestick patterns that have emerged over the past few years. These patterns are due to the massive Financial Market Structural changes, which every market has undergone including the Options Market. When a Retail Trader is able to recognize the new candlestick patterns, they are able to trade with the Professional Traders.
Training for new technical candlestick patterns includes the new types of sideways action. Stocks move sideways more often nowadays than they did even a decade ago.
The type of sideways candlestick pattern occurring is critical to identify early on, as it reveals which Market Participant Group is in control. It also reveals the direction the stock is likely to take out of that sideways pattern, and most importantly the Volatility AND Velocity of price once the breakout occurs.
Volatility and Velocity are not the same thing. Volatility is a sideways pattern, while Velocity is a sudden huge move out of the sideways pattern.
When a trader can determine when the breakout is going to occur and its direction, it optimizes many Options Trading Strategies and increases profitability trading both Options and Stocks. One important thing both Retail and Professional Traders need to learn is how to find the right sideways candlestick patterns with strong energy building, that will have big moves out of the pattern.
The chart example below shows a huge gap after a lengthy sideways pattern.
Martha Stokes CMT
TechniTrader technical analysis using a MetaStock chart, courtesy of Innovative Market Analysis, LLC dba MetaStock
Chartered Market Technician
Instructor & Developer of TechniTrader Stock & Option Courses
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