Option
trading software is usually designed for
analyzing options only. The problem with this, of
course, is that some traders use technical analysis to
determine where a market is likely to go. So, they find
themselves having to purchase more than one piece of
software to accommodate their trading style. However,
IntrepidTrader combines sophisticated technical analysis
techniques, such as the Elliott Wave theory, with option
trading analytics to allow traders to easily find
trading opportunities without the time consuming and
cumbersome effort of using two different pieces of
software.
An Option Trading Example
In preparation for
finding a trade, we set up our portfolio of securities
in the Quotes window. Figure 1 shows an example of a
listing of stocks and we are interested in scanning.
Click here for more details.
Figure 1
After the portfolio
is created, we simply open the IntrepidTrader Scan
window. This window helps us establish the criteria
that we want to scan for in the portfolio above. In
this example, we are going to search for a Elliott Wave
four formation and a Bull Call option spread for use in
our option trading. This is easily done by clicking on
the button designated "Wave 4” and selecting the "Bull
Call" spread from the drop-down box below as shown in
Figure 2. Then, we initiate the search by pressing the
"Scan" button.
Figure 2
The "Scan Results"
portion of the scanner window will show which securities
met the criteria specified in our scan. These
results are shown in Figure 3.
Figure 3
Figure 4
The Option Spread window
will display after the scan is completed as shown in
Figure 4. This window will display the option spreads
that IntrepidTrader created. It also displays key option
trading analytics for the spreads such as expected
return and probability of profit.
Figure 5
Selecting a spread
from the Option Spread window will open the Options
Worksheet as shown in Figure 5. This window is used to
provide further analysis for the option spread. It
shows the spreads profit and loss graph as well as the
related delta, gamma, theta, vega and implied volatility
for each leg of the spread. Here you can change the
“Chart as of” or “Chg in IV” values found beneath the
chart to see how the passage of time and fluctuations in
implied volatility will affect the spread. As you might
imagine, in option trading, this type of analysis and
information is very important.
Figure
6
We may also want to
look at the chart related to this option spread to time
our entry. In Figure 6, we can see a price chart for the
security that relates to the option spread that we were
just looking at. As you can see, the price target projected by
IntrepidTrader catches the end of this Elliott Wave four
correction. At this point, we want to use the gold boxes
drawn around recent price action to enter this market.
So, as prices break out of the box for the upside we will
want to enter our option spread shown in Figure 5.
Also, we will want to exit our position if the market
drops below the bottom of the box. Notice that the
reward for this spread in Figure 5 is nine times the
amount at risk.
IntrepidTrader
combines the precision of Elliott Wave analysis with the
powerful leverage found in option trading. And as you
can see, it even helps you determine your risk / reward
and probability of profit of the option spread before
the trade is entered. Realizing that all of this
analysis was done by clicking one button, you may cause
you to understand the powerful and effective trading
tools can save you time and boost your profits. And as
you imagine what this could be like for you, you may
find yourself wanting to see IntrepidTrader in action.
Click here for more details.
Stock Market Trading,
Option Trading and
Forex Software
