TradingTrainer.com Web Log

Expiring Options Close The Week On An Up Note

2005-11-20T23:44:00.000-07:00

There was no economic news on Friday. Thursday had heavy gains on heavy volume. Futures and stock options expired on Friday with a ton of call options being exchanged for the underlying stock. So, is now the time to go long? Almost, let's get a feel for momentum of the broad market on Monday. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Sunday, November 20th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from this past Friday and last week as well as prepare you for watching the market tomorrow and for the week to come.

This past Friday we ended a bullish week on a high. Not only did price close higher but volume was high as well.

So what happened? I warned of price stagnation or even profit taking. What was I off about?

Well, my thoughts were based on the lack of economic news combined with the large heavy volume gains of Thursday. That usually means the market is due for some gain digestion.

So what happened Friday? Friday, we had stock and futures options expiring. Obviously, a lot of call options were cashed in for underlying stock. All on one day, a bunch of stock was bought. It is almost as if an institutional trader made a move.

What does Friday’s reaction to options expiring say about investor sentiment? Well, it says investor sentiment is bullish. That’s powerful team. To follow a heavy up day with validation that investor’s sentiment is bullish. That’s powerful team.

My Techne January 55 Calls closed up with a bid price of $2.20 per option. I’m drawn down by 63% into my initial investment after 45 days. My Southwestern Energy December 35 Calls closed down with a bid price of $2.10 per option. I’m drawn down by 47% into my initial investment after 16 days. My Phelps Dodge January 125 calls closed up with a bid price of $11.70 per option. My return on invested capital is 46% after 2 days.

Here are my recommendations team… Monday is a new week. We made some major bullish gains this past week on heavy volume and we haven’t taken the time to digest these gains. It may indeed be that digestion is not necessary. But, I personally am gun shy. Indeed, we are moving into a holiday week. So, there is a high likelihood that due to vacation and do to a probably slow down, profit taking could bring prices down again or leave them flat.

Monday will be a good indicator. So I will be watch Monday’s price movement and letting momentum guide me through Tuesday and Wednesday.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Do you want to learn option trading? Full time options trader, A.J. Brown, reveals option trading secrets in his daily audio / video newsletter that are guaranteed to make you massive profits in less than 30 minutes a day. Visit TradingTrainer.com now.

~> You may reprint or distribute this article as long as you leave the content, the links and the resource box at the end intact. <~

Rally To Next Resitance Levels

2005-11-10T23:00:00.000-07:00

Another day of lower oil prices and a validation that there is foreign interest in investments in U.S. debt sent the market higher. Volume was heavy on both exchanges. Can we open long positions now? Wait for further confirmation of upward trends. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Thursday, November 10th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Despite the growing trade deficit, the broad market rallied today above levels of resistance. And volume was heavy on both the NYSE and NASDAQ exchange.

They say it was because oil was down again. Price shot up to close at the next levels of resistance for the Dow Jones Industrial Average, the Nasdaq Composite and the S&P 500.

Tomorrow, there is no economic news scheduled to be released… which means one of three things is going to happen. Either the market is going to continue today's rally. Or, the market is going to realize that it got caught up in a buying frenzy today and tomorrow, through profit taking it will bounce down off resistance. Or, the volume will decrease drastically and price will be flat.

All in all, it means we should wait and see. I know it’s hard team. The whole week has been a wait and see week. But, honestly, would any of you been able to navigate through this week? I know I wouldn’t have. I would have lost my shirt.

My Techne January 55 Calls closed down with a bid price of $1.95 per option. I’m drawn down by 68% into my initial investment after 37 days. My Southwestern Energy December 70 Calls closed down with a bid price of $2.80 per option. I’m drawn down by 65% into my initial investment after 8 days.

Here is my recommendations team… there is no news tomorrow. The market could do anything. It could give up today’s gains. It could continue today’s rally. Or it coulde be flat. Watching price and volume is key.

Till the market has a consistent rally, I can't be confident. I’m going to hold off on opening new positions. Holding off and sitting on the sidelines is not easy. Sometimes I feel my money burning a hole in my pocket. But, exercising self control is worth it in the end in the reduction of stress and the increase in profits… do you see what I’m talking about team?

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Do you want to learn option trading? Full time options trader, A.J. Brown, reveals option trading secrets in his daily audio / video newsletter that are guaranteed to make you massive profits in less than 30 minutes a day. Visit TradingTrainer.com now.

~> You may reprint or distribute this article as long as you leave the content, the links and the resource box at the end intact. <~

Bombs In Jordan Reverse Rally

2005-11-09T23:29:00.000-07:00

Bombs in Jordan reverse a rally attempt. Pull back in oil prices relieving constraints on growth. How do we interpret today? We don't. We wait for a day that isn't interrupted. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Wednesday, November 9th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Team, they’re saying there was a rally today and if it weren’t for the bombings in Jordan it would have really been an up day. What do you think?

We see that volume went up in the Dow chart. And, we see that volume was flat in the NASDAQ chart. The question is… was it individual investors or was it institutional traders? Team, who reacts more to current events news? Yes, individuals.

So, while we are hear trying to get a barometer reading on the broad market, something like this happens and again clouds the message.

Is the pull back in crude oil price contributing to the bulls? We just won’t know from today. We need to keep watching. The bias is neutral another day.

My Techne January 55 Calls closed up with a bid price of $2.15 per option. I’m drawn down by 64% into my initial investment after 36 days. My Southwestern Energy December 70 Calls closed down with a bid price of $4.80 per option. I’m drawn down by 39% into my initial investment after 7 days.

Here is my recommendations team. Today was a dud with the current events distracting the market. I therefore am still in a holding pattern till some sort of direction is taken. I’m not opening any new positions.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Do you want to learn option trading? Full time options trader, A.J. Brown, reveals option trading secrets in his daily audio / video newsletter that are guaranteed to make you massive profits in less than 30 minutes a day. Visit TradingTrainer.com now.

~> You may reprint or distribute this article as long as you leave the content, the links and the resource box at the end intact. <~

Reversal Or Testing Rally?

2005-11-08T23:49:00.000-07:00

Indexes lost today. Volume was light. Price volume characteristics are similar to 'getting over hump' behavior. Home builders admitted today that they are experiencing a real estate slow down. Are we experiencing a test of the current rally, or, are we experiencing a reversal? Remain in a holding pattern till the broad market reacts. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Tuesday, November 8th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Team, yesterday we questioned… Are we at the end of this rally? Today our question is… Are we just testing or are we going to go bear again?

In all of our index charts we approached resistance… those levels of resistance that we just haven’t been able to blow through yet, and, as is characteristic, we had a drop in volume and we rebounded off of resistance.

Now, what do I mean by testing. Quite often a stock will back away from a rally for a day, or two or three, to test and then proceed right on through. Is that possible in our case? Of course it is. How can we tell whether to stay in or not right now? We can’t.

It would be a treat if we could see into the future, right team? If we could get tomorrow’s paper, today. It would be the magic bullet. It would be the secret that Wall Street would pay millions for. We can’t. We can only trade based on what we see. We see a pull back. Our bias is now neutral. If it is a test and we start uptrending again, we’ll adjust the bias.

Is that a deal team?

My Techne January 55 Calls closed down with a bid price of $2.00 per option. I’m drawn down by 67% into my initial investment after 35 days. My Southwestern Energy December 70 Calls closed up with a bid price of $5.60 per option. I’m drawn down by 29% into my initial investment after 6 days. I followed my own recommendation from yesterday on my Google January 350 Calls and sold today for $52.60 per option. My return on invested capital was 98% after 13 days.

Here is my recommendations team. I’m in a holding pattern team till the indexes test the rally or build momentum on their current decline. I’m simply going to focus on my own portfolio at this time.

Being flexible and being ready for anything is the name of the game this week.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Resistance, Beat Or Retreat?

2005-11-07T23:48:00.000-07:00

Indexes gained price. Volume is still light as key levels of resistance are being challenged. There is little economic news this week to stir institutional traders. What is the best strategy? Remain in a holding pattern till the broad market reacts. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Monday, November 7th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

What do you think team? Are we at the end of our latest rally?

You have to admit that we are on our way to levels of resistance that we have tested time in and time out before. And, as we approach those levels of resistance, our volume is decreasing showing less conviction.

Remember that human nature has people saying, “Wow, we haven’t been able to break up above level xyz before, so if I was smart I’d sell then before it drops again. I better place a limit sell order at level xyz.”

Now, team, what happens when we hit level xyz? All those limit sell orders fill, investors take their profits and shares are released in the market. There is concentrated selling with only scattered buying. Concentrated selling with scattered buying always goes along with price dropping. As price drops what do you think more investors will do out of fear? Sell to realize profits. You get a catch 22.

The only way to break through resistance? Have more concentrated buying then selling. Now, who can contradict the human nature scenario we just depicted? Not, you or I. If you said, institutional traders, you are correct. Will they do it this time around? Well… we’ll need to just wait and see. It doesn’t help that there is sparse economic news this week. Positive economic news is a factor in institutional movements if you haven’t noticed.

My Techne January 55 Calls closed flat with a bid price of $2.25 per option. I’m drawn down by 63% into my initial investment after 34 days. My Google January 350 Calls closed up with a bid price of $54.30 per option. My return on invested capital is 105% after 12 days. And, my Southwestern Energy December 70 Calls closed down with a bid price of $5.20 per option. I’m drawn down by 34% into my initial investment after 5 days. I was stopped out of my Apple January 55 Calls. I sold them today at $8.60 per option. My return on invested capital was 76% after 18 days.

Here is my recommendations team. I’m still in a holding pattern team till the indexes challenge and either beat or retreat from resistance. I’m simply going to focus on my own portfolio at this time.

Being flexible and being ready for anything is the name of the game this week.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Friday Comes In Flat And Light

2005-11-06T23:41:00.000-07:00

Flat day on light volume. Record gains for the week. Stretch goals for the week were maintained. Is the rally over? Wait for the end of Monday to see what investors think after returning from the weekend. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Sunday, November 6th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from this past Friday and last week as well as prepare you for watching the market tomorrow and for the upcoming week.

The week ended with some breath catching by the broad market. That is perfectly healthy for a rally. We saw price go flat on very light volume.

What’s really exciting with respect to the broad market is our weekly charts. You know team, you can apply the counting method to determine a market bottom to more than just daily charts. Take a good hard look at the weekly charts. Yes indeed, we have satisfied the counting method to determine a market bottom with respect to the weekly chart. That’s big.

Now, many can argue that the downtrend wasn’t long enough to make satisfying the couting method significant, but take into account that we also have reached our stretch goals for the week and I would say we are on a strong bullish footing.

Let’s see if we can’t maintain this momentum in the upcoming week. Still trading cautiously.

My Techne January 55 Calls closed down with a bid price of $2.25 per option. I’m drawn down by 63% into my initial investment after 31 days. My Apple January 55 Calls closed down with a bid price of $8.60 per option. My return on invested capital is 76% after 15 days. My Google January 350 Calls closed up with a bid price of $51.10 per option. My return on invested capital is 93% after 9 days. And, my Southwestern Energy December 70 Calls closed down with a bid price of $5.50 per option. I’m drawn down by 30% into my initial investment after 2 days.

Here is my recommendations team. Watch on Monday for the market to maintain those stretch goals. You want to get a good feeling how the investors have returned from their weekend.

For me that is going to take all Monday to figure out.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

No News; Large Gains On Heavy Volume

2005-11-02T23:59:00.000-07:00

Oil and gas prices continued to fall as demand stays low and supply is increasing with more refineries coming back online. The broad market rallied on heavy volume led by the small caps. Is it time to trade long? Trade cautiously through the end of the week. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Wednesday, November 2nd with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

There was no real news today, besides the oil and gas stock piles increasing. But yet the market rallied on heavy volume. Extremely heavy volume. The institutional traders were buying. Chalk one up for the bulls.

The test we placed on the broad market was that the indexes would maintain key levels of support. For the Dow that was 10,400. For the Nasdaq that was 2,100 and for the S&P500 that was 1, 200. At this point we’re even thinking about ‘icing on the cake’ which would be, what would happen if this week the Dow breached 10,500, the Nasdaq 2, 160 and the S&P 500 1,220?

We’ve got some key news coming up tomorrow and Friday that could either enhance or make fuzzy this bullish picture. Tomorrow with data being released about Factory orders and the ISM coming out with their service index, and then with the employment report coming out on Friday… we’ll just have to play it cautiously team.

My Techne January 55 Calls closed up with a bid price of $2.45 per option. I’m drawn down by 59% into my initial investment after 29 days. My Apple January 55 Calls closed up with a bid price of $7.80 per option. My return on invested capital is 59% after 13 days. My Google January 350 Calls closed up with a bid price of $45.00 per option. My return on invested capital is 70% after 7 days. And, today team I bought Southwestern Energy December 70 Calls. I bought them at the end of the day at an ask price of 7.90 per option. When the day closed, the bid price was at $7.90 per option. My return on invested capital is 0% after just few hours.

Here is my recommendations team. Look for the markets reaction to tomorrow mornings news. Also, look for the indexes to maintain levels above those price milestones. In fact, look for the indexes to hit those stretch goals.

Trade cautiously team because any bad news will cause a mass amount of profit taking. Have your stop loss orders in place. Let’s take it day by day and week by week at this point and take nothing for granted.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Stalled Market On Mixed Volume

2005-11-01T23:52:00.000-07:00

The Fed raised rates another quarter point to 4%. Verbiage accompanying the rate hike was nothing new. The market stalled. Volume was mixed. What's the broad market trading bias? Watch if the indexes maintain above key levels of support. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Tuesday, November 1st with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Well team, the fed raised rates today and will continue raising rates at a measured pace. So, there was no new verbiage. The market was stalled all day waiting for that, and then, for the most part it stalled the rest of the day. Volume was mixed not telling us anything.

Team, our big test of the week is, can the indexes hold above those key levels. For the DOW, we’re talking about 10,400. For the NASDAQ, we’re talking about 2,100. For the S&P we’re talking about 1,200. Till we see that, we will continue to trade the Neutral / Bullish trading bias emphasizing more the Neutral and less the Bullish.

My Techne January 55 Calls closed down with a bid price of $2.25 per option. I’m drawn down by 63% into my initial investment after 28 days. My Apple January 55 Calls closed flat with a bid price of $6.00 per option. My return on invested capital is 22% after 12 days. My Google January 350 Calls closed up with a bid price of $43.50 per option. My return on invested capital is 64% after 6 days.

Here is my recommendations team. Look for the indexes to maintain levels above those price milestones. Tread lightly till that level of support is tested and holds strong. Be prepared to take profits in your own portfolio should those levels be breached.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

A Rally On Heavy Volume

2005-10-31T23:08:00.000-07:00

Strong economic data, mergers and acquisitions and lower oil prices sent the market on another rally. Volume was heavy on both the Nasdaq and NYSE. Tomorrow, should we open long positions? Wait and re-evaluate your strategy after the FOMC announcement. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Monday, October 31st with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Well team, oil prices are dropping. Today we got some fairly favorable economic data with consumer spending coming in at forecast and at the same time personal incomes came in well above expectation. Also, the Chicago Production Management Index came in higher than expected. All the positive news sent the market higher on higher volume.

If you have a bullish tendency towards you then you like what happened today because when you get a price increase on heavy volume you have price movement with validation. If you rewind to the price gains that were made last Monday, volume is what lacked. And you saw what happened on Tuesday, Wednesday and Thursday.

We are now above those miles stone levels in each of our three indexes. The Dow is above 10,400. The Nasdaq is above 2,100. And, the S&P 500 is above 1,200. The question of the day is… can we sustain that for the week. Time will tell, but that would be monumental. In the meantime, we’re sticking with our neutral / bullish trading bias. Still more neutral than bullish.

Tomorrow the Fed announces another position on interest rates. Team, their actions matched with their words can make or brake tomorrow’s market.

My Techne January 55 Calls closed down with a bid price of $2.50 per option. I’m drawn down by 58% into my initial investment after 27 days. My Apple January 55 Calls closed up with a bid price of $6.00 per option. My return on invested capital is 22% after 11 days. My Google January 350 Calls closed up with a bid price of $38.00 per option. My return on invested capital is 43% after 5 days.

Here is my recommendations team. First, the big news tomorrow is the Fed verbiage that will accompany their rate hike. Only after that announcement is made and the market digests it, which will be in minutes after, will I consider opening any trades.

In the meantime on options in my portfolio I am placing tight trailing stop loss alerts – like around 15%. Even on those that are under water. And, in addition for those under water, I’m placing sell alerts at break even. The idea is to holistically come out above water if you have to irradicate your whole portfolio because the market takes a dive.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Friday's Rally Means Positive Weekly Gains

2005-10-30T23:09:00.000-07:00

A strong Q3 GDP sent the broad market on a rally. Volume on the Nasdaq was heavy. The NYSE had lighter volume. The trading bias is more neutral now than ever. How do you trade when the broad market is neutral? Lower your profit targets, trade faster and look for charts that stand on their own. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Sunday, October 30th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from this past Friday and last week as well as prepare you for watching the market tomorrow and this upcoming week..

A very positive 3rd quarter gross domestic product number set the pace and direction on Friday. For the large caps, as they are measured by the Dow and the S&P 500 that meant recouping all the gains we had seen on Monday, even after giving them all back throughout the week. For the small caps it meant coming back into positive territory for the week. Interestingly enough, it was on the NASDAQ exchange that we saw an uptick in volume. On the NYSE, we actually saw volume subside.

For the week we actually can start to picture, if we try hard enough, that we hit a bottom three weeks ago and that we are on our way back up. But, really at this point, that is a little bit of a stretch. The next week can either further qualify that or discredit it.

All in all, the index charts are still telling us to take a neutral approach to the market. We’re going to leave our trading bias at neutral / bullish based on the bottom we saw a couple of weeks ago. But, I’m urging everybody to trade more neutral than bullish.

Trading neutral means lowering your profit targets and expectations, being faster on your entries and exits and picking underlying stock charts that can really stand on their own – meaning the entry and exit signals are so prominent and strong that whether the broad market was against them or with them, the stock would still perform as expected.

My Techne January 55 Call closed down with a bid price of $2.60 per option. I’m drawn down by 57% into my initial investment after 24 days. My Apple January 55 Calls closed down with a bid price of $4.10 per option. I’m drawn down by 16% into my initial investment after 8 days. My Google January 350 Calls closed up with a bid price of $29.50 per option. My return on invested capital is 11% after 2 days.

Here is my recommendations team. First, earnings season is over so we will see the volatility subside. Watch for profit taking on Monday especially if the economic news is negative. Wait till the afternoon to take a reading of the market.

At this point team we want to trade only sure things. The charts need to be very confident. How will you know? They will be the charts you personally feel very comfortable with. Trust the hairs on the back of your neck. If you have any doubts, save your money for another trading day and paper trade instead. That’s the best thing about trading… we don’t have to.

It’s when we have to that trading controls us instead of us controlling the trading. When the trading controls us, we loose. When we control the trading we profit. No different than any other scenario in life, right team?

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

3rd Day Of Broad Market Declines

2005-10-27T23:56:00.000-06:00

Poor earnings and down economic data send the broad market declining today on lighter volume. Small caps led. Tomorrow's strategy? Concentrate on your own portfolio versus looking for new positions. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Thursday, October 27th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Unsettling earnings sent the market on a tailspin. The small caps led the decline. Volume subsided by some degree across the board. Heavy volume means our institutional traders are selling off. That is definite bearish sign. For the most part, all the gains on Monday have now been erased. The weekly chart, if you think about it, with it high intra week high and then a close at or below last weeks close will be either a Lincoln’s hat formation or a key reversal down formation, both which signal next week to be a down week. Tomorrow will be an important day in this determination. And with the Gross Domestic Product news being released, it’s sure setting up to be an exciting one.

My Techne January 55 Calls closed down with a bid price of $2.85 per option. I’m drawn down by 53% into my initial investment after 23 days. My Apple January 55 Calls closed down with a bid price of $4.60 per option. I’m drawn down by 6% into my initial investment after 7 days. My Google January 350 Calls closed down with a bid price of $27.10 per option. My return on invested capital is 2% after one day.

Here is my recommendations team. Watch tomorrow closely especially for the market’s reaction to the third quarter Gross Domestic Product number. Looking for new long or short entries tomorrow is a little risky. Concentrating on your own portfolio might me more prudent.

My reaction is to elegantly exit all positions in my portfolio. That means limit sell alerts for break even on underwater options. Stop loss alerts at break even for options below my profit target. And, tight trailing stop loss alerts for options above my profit target.

Tomorrow will be fun, but more fun will be evaluating the weekly charts after tomorrow’s close.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Bond Market Affecting Stock Market

2005-10-26T23:56:00.000-06:00

Spike in yield on 10-year treasury bond. Hawkish fed. Indexes drop on heavy volume although still above key levels of support. How do we navigate this neutral market? Lower profit targets and expect shorter duration trades. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Wednesday, October 26th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Well team. The nomination of Bernanke as the Fed chief is sending ripples through the bond market. And, that in turn is starting to effect the stock market. Although the stock market resumed this morning with yesterday afternoon’s bullish rally, the bond market hinting at inflation woes and expected aggressive reactions by the Fed especially with Bernanke coming in, as well as some poor earnings results today... had the market close at its intraday lows. And, volume ticked up again from yesterday.

From a technicals perspective we are still within our levels of support and resistance. So, there is no need for us to question our trading bias right now. Neutral bullish is where it should be. At this moment; probably more neutral than bullish.

My Techne January 55 Calls closed down with a bid price of $4.20 per option. I’m drawn down by 30% into my initial investment after 22 days. My Apple January 55 Calls closed up with a bid price of $5.50 per option. My return on invested capital is 12% after 6 days. I bought Google January 350 Calls at $26.50 per option today. They closed up with a bid price of $28.00. My return on invested capital is already 6%.

Here is my recommendations team. We are definitely in a neutral market. We want to watch our broad market indexes that they don’t venture below levels of support. We also want to watch to see if they close up above those magical levels of psychological resistance. 10,400 for the Dow. 2,100 for the NASDAQ. 1,200 for the S&P 500. In the meantime, anything goes.

When I say that, I am saying to you that you need to expect less profits and you need to expect shorter duration trades. I’m not saying become a day trader. I’m saying that if you want to play this market you’ll need to be a little more active and diligent watching your portfolio at least once a day. This is also when you want to err on taking profit rather than holding out for higher potential gains. In fact, tight trailing stop losses when your trades are above your profit targets and break even stop losses when below are critical in this type of market. And, setting limit sells for underwater options.

This is the time when a lot of people sit out and paper trade. That is completely acceptable.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading
Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Profit Taking After Yesterday's Rally

2005-10-25T23:25:00.000-06:00

Consumer confidence came in lower against expectations. Oil ticked higher on forecasts of cold north-east. The indexes closed lower on slightly heavier volume. Will we give back yesterday's rally? Look for the indexes to maintain levels above psycological support. free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Tuesday, October 25th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Team, despite the less than stellar consumer confidence report and some poor earnings coming from HMO insurers, the broad market held on remarkably well to the gains from yesterday.

Today could be hardly called a distribution day. There wasn’t enough downward price movement. And, volume was only up slightly.

What looked like happened to me was, the market opened with profit takers looking to cash in on the price gains from yesterday. As they sold their shares, prices dropped and the broad market retreated. But, as the day rolled on, it seems like the bulls roared again and although they didn’t buy enough to keep the broad market from loosing, they did buy enough that the indexes for the most part closed only slightly lower versus really low which is where their afternoon lows were.

And, if the bulls showed up toward the end of today, then it will be probable that they will show up tomorrow morning and continue raising the market higher. We’d like to see the small caps lead again. In fact, we would like to see the DOW sustain above $10,400, the NASDAQ sustain above $2,100 (which it is) and the S&P 500 sustains above $1,200 – all psychological levels of resistance. Then, and only then, will we feel that the gains from Monday were permanent. Fair, team?

My Techne January 55 Call closed up with a bid price of $4.40 per option. I’m drawn down by 27% into my initial investment after 21 days. My Apple January 55 Calls closed down with a bid price of $5.00 per option. My return on invested capital is 2% after 5 days. I sold my Google December 310 Calls at $42.50 per option. My return on invested capital came to 201% after 5 days.

Here is my recommendations team. We need to look for the broad market to attain and maintain those psychological levels of support before we look to open any more long trades. Again, those levels are - $10,400 for the DOW, $2,100 for the NASDAQ and $1200 for the S&P 500. Till those levels are attained, for me, sitting on the sidelines is a really comforting thought.

For stocks in my portfolio, I'm looking to liquidate them at a profit using stop losses for profitable trades and limit sell orders for unprofitable trades. That's my strategy for tomorrow.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading
Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Market Relieved At Fed Chief Selection

2005-10-24T23:13:00.000-06:00

The broad market rallied today. Volume on both exchanges was light. Wilma spared the gulf, oil prices drop. When will we know if today's advance will stick? Always look for volume validation. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Monday, October 24th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Not much for me to say today in my opening comments. The market went crazy ape bonkers, for lack of a better phrase, over the nomination of the new Fed Chairman. But team; look closely at what happened to see what the market was so excited about.

Here’s what I want you to look past the price gains to see. First I want you to look at what happened in the bond market. The 10 year long bond’s yield shot up 6 basis points. What does that mean? It means the market believes the new chairman is hawkish about raising interest rates. Second I want you to look at the volume. Rather than the volume increasing to show a sign of support or validation for the price movement, it actually declined by a lot. What can we infer? Perhaps that although the broad market masses endorsed the new Fed chief nomination, the more important institutional traders are skeptical.

Here might be a better take on what happened today. The U.S. market is very jittery right now. There is a lot going wrong fiscally with the U.S. government right now and everyone knows it. The market watched how the latest U.S. Supreme Court nominee was picked and was recoiling in fear that a similar strategy might be used to select the new Fed chairman. Instead, the gentleman that was selected was the one that was expected. So, today’s rally seems really more a sign of relief that something went as expected. The rally does not seem to be a vote of support. We’ll see how the week and the months leading up to Greenspan’s departure go before we draw our conclusions about how the new U.S. Fed chief will be perceived.

My Techne January 55 Call closed up with a bid price of $4.20 per option. I’m drawn down by 30% into my initial investment after 20 days. My Apple January 55 Calls closed up with a bid price of $5.40 per option. My return on invested capital is 10% after 4 days. My Google December 310 Calls closed up with a bid price of $44.00 per option. My return on invested capital is 212% after 4 days.

Here is my recommendations team. We need to be leery of today’s price increase on minimal volume. And we need to be aware of the consumer confidence report that is going to be issued tomorrow. Once the morning has passed, we will be able to see where the market will go. Look for volume to validate any movement.

Most importantly have tight stop loss on your trades with high profits already. And, set stop loss alerts at break even for trades with just a little profit. That’s my strategy for Google and Apple.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading
Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Advancers Versus Decliners Positive

2005-10-23T23:03:00.000-06:00

Indexes were mixed. Earnings of single large cap stocks weighed heavy on indexes. How can you evaluate the broad market when the indexes are so heavily influenced? Evaluate advancers versus decliners in the watch list updates. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Sunday, October 23rd with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from this past Friday and last week as well as prepare you for watching the market tomorrow and for weeks to come..

Friday was all about driving the broad market with big winners and losers. Caterpillar, a mega large cap industrial, missed their earnings big time. Caterpillar had a substantial drop. It took the Dow Jones Industrial Average with it. Google on the other hand, beat expectations hands down. Google shot up to a new high taking the NASDAQ Composite index with it. But, because these big losers and winners had such influence on the indexes, it kinda threw off our system for understanding the broad market. On, Friday the indexes were just not representative of the broad market. So, we fall to our back up. We look at the number of advancers versus decliners in our watch list and we actually see that the advancers won out on Friday.

What’s really interesting this week, team, is taking a look at the weekly charts for the indexes. These charts, instead of giving us an idea of what to expect over the next weeks to up to 6 months from now gives us an idea of what to expect over the next month to up to 2 and a half years. And, although we got indication last week that we’ve got a confirmed rally (and then with the breakouts we got on Friday we got further validation) we also got key reversal down patterns in the weekly charts for the Dow Jones Industrial Average index as well as the S&P 500 index. That tells me team to watch closely for 2006 and 2007 for there is some pretty prevalent long term bearish pressure.

My Techne January 55 Call closed up with a bid price of $3.70 per option. I’m drawn down by 38% into my initial investment after 17 days. My Apple January 55 Calls closed flat with a bid price of $4.90 per option. My return on invested capital is 6% after 1 day. My Google December 310 Calls closed up with a bid price of $36.60 per option. My return on invested capital is 160% after 1 day. Slam dunk.

Here are my recommendations team; There is no big news scheduled for Monday. That usually means the lemming investors will be running in circles and the institutional traders will be sitting out. We have more earnings reports. Energy stocks will start coming in this week and will for sure bouie the market.

I’m going to wait through the morning before even thinking of opening a trade. In the afternoon, if there is a position I’m interested in and the market and/or the sector is going my way, then and only then will I consider it. If not, sidelines it is.

And, for those of you that followed me into Google, a tight trailing stop loss alert is needed here. Like 15%

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading
Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Are The Bears Back?

2005-10-20T23:57:00.000-06:00

Oil prices dropped again. The indexes dropped as well on lighter volume. Today we had a correction in which an opening for a new market leader sector became available. Are the bears back? Trade cautiously tille a trend develops. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Thursday, October 20th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

So, what happened? Why did the bears come back out? Take a moment team and do an investigation. Let me give you hint. Look at the commodities. Look at raw materials and energy stocks. They pulled back significantly today.

The large cap leaders were composed for the most part by these commodity related companies. So, when they took a dive today, so did the broad market. But look closely, especially at the latest update of the TradingTrainer.com watch list. If you look at just the number of advancers versus decliners, it wasn’t all bearish. In fact, technology stocks had some what of a good day.

So do we reverse our bias? That’s the million dollar question. At this point, I say no. Here’s why. Volume was lighter today telling me that the sell off was a correction. Also, by delving deeper and seeing that it was the commodity related stocks that were being sold off, that is actually something of merit if you are a bull.

See, we’re talking about the U.S. market here. And, for the last nine months or so commodity type stocks have been leading the broad market. That’s really not the U.S. forte. In fact commodities can really be done better elsewhere. The U.S. strength is in innovation and cutting edge technology. So, if anything, today’s churn in the broad market, a correction if you will can be seen as getting the U.S. back on track with what they’re good at. It’ll be interesting to see who the upcoming leaders will be now that this pull back occurred.

My Techne January 55 Call closed flat at $3.50 per option. I’m 42% into my initial investment after 16 days. Today I did some bargain shopping and opened two new long positions. I purchased Apple January 55 Calls at $4.90 per option. At close, the bid price was up at $5.20 per option. My return on invested capital is 6% already. Today, I also purchased Google December 310 Calls at $14.10 per option. At close, the bid price was down at $12.60 per option. I’m 11% into my initial investment already. With Google shares appreciating massive ammounts after hours on them beating earnings expectations, it'll be interesting to see where the option price opens tomorrow.

Here are my recommendations team; we definetly can’t predict anything at this time. So, if this volatility is driving you stir crazy, play it cool and take a break. Sit tomorrow out.

However, if you have the insight to dig a little deeper, like we did today, to find out what was driving the indexes down and how that would affect our thought process, you can play this market strategically.

My thoughts… look long versus short.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading
Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Counting Method To Determine A Market Bottom Satisfied On Day Five

2005-10-19T23:04:00.000-06:00

Oil prices dropped. The Fed Beige Book said growth is happening despite the hurricanes. The earnings season has an overall positive theme. We satisfied the 'counting method to determine a market bottom'. Can we believe it? Look for follow through when opening long trades. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Wednesday, October 19th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

The counting method to determine a market bottom was satisfied today. It started out that the bearish sentiment that won out yesterday, for the most part, had the market opening lower. Early on, the market went even lower. But then, news started to roll on in.

First it was the oil stock piles. With the demand dropping on the high retail prices of petroleum that consumer are seeing, coupled with the supply that’s being imported as well as that’s coming back online from our crippled infrastructure – we’ve got a surplus forming quickly. So oil prices are dropping.

Second, it was the Fed Beige book notes that were released in the afternoon. Basically the jist of those notes was that the economy is strong and that the hurricanes had little lasting effect. Also, they addressed high energy prices and inflation and how it is flowing through to retail customers and how they would contain it with possibly more aggressive rate hikes.

Third, the earnings season, for the most part so far, has been positive.

The market bulls came out on the news. When I say we satisfied the counting method to determine a market bottom, I am saying that it is day five in our series and we got a price increase of over 1% on all the indexes we look at as well as heavy volume. This is very strong confirmation that the down trend is over. Like 9 or more out of 10 accuracy. I’ve upped the trading bias to neutral bullish on this news and we’ll be looking for our other indicators to come in line as the days roll on.

My Techne January 55 Call closed flat at $3.50 per option. I’m 42% into my initial investment after 15 days.

Here are my recommendations team; today was pretty monumental for the bulls. Pretty monumental indeed. But, we know from yesterday that the bears are out there. So, we need to be prepared for the market to catch up with today. I can see that tomorrow and Friday that we may have a stall. I expect that. Actually, Friday more than tomorrow. Tomorrow, we’ll still be so excited from today.

Anyway, knowing the bears still exist, we need to tread lightly.

At this point, we do need to exit our short trades and fast. But, even more we need to really look for follow though before going long. We have so many securities setting up, we need to pick the best of the best.

Now is not the time to get caught up in the frenzy. Practice control and follow our rules for follow through. Only open a trade if the stock and the broad market are going your way. Look for a lack of news and a lack of insider trading. And, be cautious of earnings reporting. That could send you flying or dying.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading
Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Validation That Our Bearish Trading Bias Is Correct

2005-10-18T23:15:00.000-06:00

A surge in the Producer's Price Index caused inflation fears. The broad market declined on heavy volume despite promising earnings reporting. What about our 'counting method to determine a market bottom'? Be prepared to exit short trades at a moment's notice. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

Alright then, we had a down day and volume ticked up. What does that tell you team? It tells me that, the institutional traders only come out when its time to sell. What do they know that we don’t? We’ll it seems they are really looking long term at interest rates.

Today the producer’s price index was released and it shot up. It shot up by a record amount. So, although we are well into this earning season, and for the most part, companies are reporting better than expected results, that inflation fear is really what is driving investors. Whenever investors are reminded of inflation, as the PPI did today, the sell bells ring. Today people who were sitting on the sidelines during the rally, came out and sold.

Does that mean our rally is over? Well, the counting method still is going. We did not drop below our level so we still have three days in which if we get an uptick in price greater than 1% and that is on heavy volume, that we will indeed believe last Thursday’s trend reversal is valid. So, we still want to have our eyes peeled. But, for now, today, we got volume validation that indeed the bearish market is the right trading bias.

My Techne January 55 Call closed down at $3.50 per option. I’m 42% into my initial investment after 14 days.

Well team, today we saw validation that the bear is still there. There is still a possibility we can get an uptick in price on heavy volume that will satisfy our counting method to determine a market bottom. But, till now, after today’s heavy volume pull back, it will be more difficult.

How does this affect us? We’ll, today our bearish trading bias was reinforced so looking for short entries would be prudent till we get a true signal of the bulls taking over. Now, because that could happen any time this week, it would actually be even smarter if we stay in our short entries, not open any new ones, and just play defensively. Be ready to take profits and run. But, I can’t stress, don’t jump to conclusions. This is where a tight stop loss or trailing stop loss alert comes in handy team.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Use The 'Counting Method To Determine A Market Bottom'.

2005-10-17T23:21:00.000-06:00

Today was flat to slightly bullish. Volume was lighter than even last Friday. How will we know if this rally will peter out and turn bearish again, or will confirm? Look for the 'counting method to determine a market bottom' to be satisfied. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

We continued with the low volume rally today. In fact, we had lighter volume today than on Friday. So the real question is; how will we know if we hit a market bottom last Thursday?

One of the methods most commonly used to determine if indeed we found our market bottom and the trend reversal we’ve seen is one we can put some confidence behind, is called the counting method to determine a market bottom. Basically, it’s this. We draw a reference line from the lowest day’s close. Every subsequent close should, at a minimum, be above that level. Even better is to have every subsequent close higher than the last. Now, between the fourth and the seventh trading day we are looking for a price increase of 1% or greater on heavy volume. If that follow thru happens, we are confident of the trend reversal. If it doesn’t within the seven days, then we need to start the method all over again. This method, team is right over nine times out of ten.

So, tomorrow, Tuesday, October 18th, is our fourth day on all three indexes. If we get that validation from the counting method to determine a market bottom… that will be enough to swing our trading bias from bearish to bullish. So, read between the lines team… or listen to me say it bluntly. Be prepared to exit short positions should this happen. It’s premature to exit now. But, should we get a high volume gap up day… you’ll want to be out of short positions.

My Techne January 55 Call closed up at $3.60 per option. I’m 40% into my initial investment after 13 days.

Team, I’m going to be playing defensive again. Without an understanding of where the broad market is really at, it really hampers me in determining whether I should be looking for long or short entries. Of course, if you pick a stock that stands firmly on its two feet you may be able to weather going against the broad market. But, for me, the proposition of perhaps winding up the salmon going up stream is not too appealing. So, I’m playing the wait and see game.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

More Beginning Signs Of A Turnaround...

2005-10-16T23:47:00.000-06:00

The small caps led a rally. Key levels of support were reestablished. Volume was significantly lower. The market closed lower for the week. Do you know how to confirm a reversal? Invest defensively until a decisive direction is established.. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Sunday, October 16th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from this past Friday and last week as well as prepare you for watching the market tomorrow and the upcoming week.

We had a turn-around on Friday… perhaps. The broad market appreciated. The small caps dominated. But, what worries us is the light volume. Light volume is a clear and present sign that our institutional traders did not go along with the direction the market moved.

The most likely reason our minority of individual traders brought the market higher probably had to do with the consumer price index factoring out energy being flat – perhaps leading investors to believe that the fed’s interest rate hikes are working. Other reasons may include retail sales minus automobiles being solid and oil prices dropping.

But, here is how you have to think about it. A buy or a sell of a single share of stock is vote. The vote is tallied at the end of the day based on how many total votes came in that day. So, if 25 shares were sold and 75 shares were bought, then there was a higher ratio of shares bought out of the total shares moving – 75 out of 100 in our example – versus shares sold out of the total shares moving – which in our example was 25 out of 100. So in our example, the stock share price would most likely move up.

Here comes the interesting point, by sitting on the sidelines, neither buying or selling, you not only don’t vote, you reduce the number of shares that moved for the day. So, when an institutional trader sits a session out, the confidence we can have in the day’s outcome is not so high. Let me explain. Take our example. Our example had a majority of investors buying out of the total number of investors there was that day. Now, say an institutional trader was to have sold that day. And say they sold 100 shares. Now, with one persons vote, we have 125 shares out of 200 that were sold and 75 out of 200 shares that were bought. The tables were turned on the votes from a single institutional trader. In this second case, the share prices would have dropped. This team, is exactly why we don’t believe the market’s actions when volume is light. And why we believe high volume days are more credible.

My Techne January 55 Call closed flat at $3.20 per option. I’m 47% into my initial investment after 10 days.

Team, what is key right now is to watch if these beginning signals we are seeing of a broad market reversal are going to pan out. We should know one way or another by early next week. And, earning season will be getting well on it way.

I’m going to be taking a defensive approach for early this week. Just looking for signs to exit my long and or short positions. An offensive approach is better saved for a later date.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Bears Running Out Of Steam?

2005-10-13T23:06:00.000-06:00

Bullish pressure finally overpowered bearish pressure in the small caps. Volume was light. What would we need to see to have confidence in a trend reversal at this point? We will keep our bearish broad market trading bias till we see volume support a bull rally. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Thursday, October 13th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Today was an interesting day with respect to technicals team. Let me explain why. I like to look at every day like a jury trial. Throughout the day, the two sides, in our case, the bears and the bulls argue their sides swaying the jury minute by minute, but at close, a verdict must be given. Today, in the broad market, we saw some heavy bearish pressures, but, you know what? The close was just about where the open was. In the case of the small caps on the Nasdaq, S&P600 and Russel 2000, the close was above. What that tells us is that when it came down to it, the bulls finally had had enough and they roared.

Now, there is a clincher to this. That is the drop in volume. If we go back to our analogy, the number of jury members that showed up was less today then in the past days when the bears won on a landslide. As well, none of today’s jury members were influential… or in real speak, we didn’t see the foot print of any of our institutional trader friends. So, was today just a fluke?

Here is what we would like to see on a trend reversal. The days leading up to the reversal having less and less volume and then the day of trend reversal and the subsequent days having heavier and heavier volume. In other words, we’d like to see an over turn in shares. What we saw today and in the past days was quite the opposite. So, what is the confidence that we’ve hit bottom? Not very high. But, today’s movement could be significant and raised enough flags that we’ll be looking for follow through tomorrow and into next week.

For now, we’re going to stick with our bearish bias.

My Techne January 55 Calls closed up today at $3.20 per option. I’m 47% into my initial investment on this one team after 9 days.

Team, till we see anything solid, we are bearish. We are still looking to be in short positions. But, we want to watch, especially when we get hints like we did today, for the bulls to finally fight back against the bears.

Always team, look for volume, before making a move. Volume will tell you whether its just a fluke or if there is something substantial going on.

Tomorrow is a day of morning news. Wait till the news settles before making moves team. Don’t get caught in the frenzy.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

The Market Continues To March Lower...

2005-10-12T23:55:00.000-06:00

Rebound buying early only to give way to high volume downward pressure and closes at intraday lows. Oil gained, but energy stocks dropped with the rest of the broad market. Do you know how to look at our templates upside down for short entries? Invest in Puts when you see a short entry materialize. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Wednesday, October 12th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

An interesting phenomena is happening team. Every morning price opens higher and for amateur hour, for the most part, rebound buying happens. Probably from everyday traders like you and I that thinks it can’t get any worse and that every stock is at a bargain right now. Then, interestingly enough, our institutional traders jump in, especially in purging their small cap positions, and leaving a wake of heavy volume behind them after yet another sell off, they drive prices to close at their intraday low. It’s pretty neat actually.

From our perspective, our bearish trading bias has really become rather robust. Meaning picking a stock that can stand on its two feet is less and less necessary. The broad market is trending down and it is pulling everything with it. Even having the price of oil going back up, which should bolster energy stocks… well, it just isn’t happening because the downward force is so strong and far reaching.

The good news for us is that we have the magical Put option. Team, we can make money when the market is going down. Don’t be afraid to use that tool in the toolbox.

My Techne January 55 Call closed down today at $2.50 per option. I’m 58% into my initial investment on this one team after only 8 days.

Team, scan through those buffered, reactive and Chaikin reports to find possible short entries. Follow the same recipe we use for long entries, only substitute Puts for calls and look at everything upside down. Watch Meritage homes – ticker MTH - tomorrow. And, always be ready for a technical bounce up when the bulls fight back, even if it is temporary, you need to be ready.

Tomorrow is a day of news that could send the sensitive market all over the place. Expect short term volatility – as in over the period of the day. Expect long term downward movement – as in over the period of a week.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Use Puts To Take Advantage Of Short Entries!

2005-10-11T23:37:00.000-06:00

So far, earnings announcements have been poor. Oil gains on demand forecasts. FOMC meeting cite considerable inflationary pressures. How do options traders capitalize on short entries? Don't be afraid of Puts. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Tuesday, October 11th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

The first earnings announcements have come in, and so far… not so good. Match that with oil prices going up on heavier demand forecasts and with the Fed Open Market Committee’s meeting minutes citing considerable inflation pressure and the need to continue to raise interest rates... and you had a recipe for another flat to down day.

The volume foot print was there team. Both the NYSE and the NASDAQ exchanges had heavy trading going on, telling us that our institutional trader friends were out today.

Large cap stocks for the most part closed flat. The small caps, however, fell. The NASDAQ actually closed below its 200 day moving average, the first time that has happened since last spring. This all reinforces our bearish trading bias team. Tomorrow I’ve got my eyes open for short entries.

My Techne January 55 Call closed down today at $3.10 per option. I’m 48% into my initial investment on this one team after only 7 trading days.

Team, this pull back will be profitable for us if we go short. Pay special close attention to signals to open short positions within our watch list. If you get a signal in the evening, like we did with Beazer Homes, and then the next day we get the follow through we look for, it’s time to buy some puts.

Don’t be afraid of using puts as a tool. They are what allows us to make money in a depreciating market. Team, puts are our friends.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Surprise! It Is Third Quarter Earning Season Already...

2005-10-10T23:39:00.000-06:00

It's third quarter earnings season. Oil, inflation and hurricanes have distracted investors from watching underlying companies . For most investors, will the earnings announcements be a surprise? Be prepared to react this season. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Monday, October 10th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Third quarter earnings season is upon us team, and your guess is as good as mine. What’s interesting is, with the price of oil and gas sky high, with the Fed being scrutinized over their next move with interest rates, and with the tragedies on the gulf coast in the wake of hurricane Katrina followed by Rita, we really haven’t been paying attention to how business is doing.

We can only guess that business has been affected by oil prices. Or, can we even guess that? The key word in both of those sentences is guess.

Team, use your earnings calendar to find out when our watch list stocks are up to bat. And, if you are brave enough, plays them as they come. For me, I’ll probably spend this season mostly watching from the sidelines.

My Techne January 55 Call closed flat today at $3.30 per option. I’m 45% into my initial investment on this one team after 6 days.

Team; tomorrow is a day of more earnings announcements and the Fed Open Market Comitte minutes from their last meeting. Just those meeting notes could turn a morning trend around in the other direction so my reaction is to stay out; to watch this one from the sidelines.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Slight Gains On Light Volume, Beware!

2005-10-09T23:58:00.000-06:00

Employment reports came in better than expected. The indexes closed higher. But, volume was very light causing us to question the upward price movement. Where were our institutional traders? Be apprehensive if you don't see volume. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Sunday, October 9th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from last Friday and last week as well as prepare you for watching the market tomorrow and for the weeks to come..

We had very little volume on Friday. Employment reports came in better than expected, so with whatever volume we did see, it created a price movement in the positive bullish direction.

But remember team, that bullish price movement didn’t come from our institutional traders, did it? Our institutional traders leave a big foot print. On Friday we can deduce that our institutional traders took the day off. So, here are the conclusions you can make. We are in a bearish trading bias…. We should be closing long entries and looking out for short entries.

There is a good chance there will be some rebound buying maybe as early as next week. We want to see that institutional trader foot print – which is what again, team? That’s right, volume. If we see that, we want to look back at some of the charts that have established bullish trends and are triggering right now. An example is Alcon, ticker ACL.

Team, remember this from my book and from the teleclass… we don’t do our technical templates for the sake of doing technical analysis. There are tons of places out there that do that, teach technical analysis for the sake of technical analysis. What we are doing team is using technical analysis to see the behavior of stocks on our watch list and to see behaviors of our watch lists as wholes to understand the broad market.

We’re looking to understand where the big monies are flowing, what those institutional traders, those few people that control the most of the money being traded… we’re looking to understand how they are feeling and where they’re taking the market. By understanding these behaviors, the insights we gain will make us the best investors that have a leg up against everyone else.

You can only get this type of analysis here folks. Amazingly powerful. It knocks my socks off every day what we have going for us that no other trading community does.

My Techne January 55 Call closed down Friday at $3.30 per option. I’m 45% into my initial investment on this one team after only 3 trading days.

Team; tomorrow is a day of no news. It’s Christopher Columbus day. Volume is the parameter to watch tomorrow. If you see it combined with price movement, by all means act. If you don’t see volume, then beware.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Good News Could Not Eclipse Inflation Fears

2005-10-06T23:30:00.000-06:00

Retail sales increased in September. Oil dropped to a new low. But, inflation worries triumphed. Small caps dropped pulling the broad market lower. What will tomorrow's employment report bring? If you can't be an active trader tomorrow, sit the day out. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Thursday, October 6th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Although retail sales picked up in September, and oil dropped to another low – this time taking natural gas with it, we still had fear of inflation bringing the market to close lower with small caps leading the pack.

What we saw today was a little different than yesterday and Tuesday’s distribution days. Yes today we had heavy volume, but the days close tended to close right smack dab in the middle of the day’s intra day high and intraday low. That means rather than the bears winning by a landfall, there was just about equal pressure from the bears and the bulls. That usually signals to us that a bottom has been hit. Of course, today was very weak on news.

Tomorrow we get our employment report for the month and that could be just enough news to send the market in one direction or the other. We’ll just have to watch and react accordingly to the behavior of tomorrow’s market.

Team, remember this from my book and from the teleclass… we don’t do our technical templates for the sake of doing technical analysis. There are tons of places out there that do that, teach technical analysis for the sake of technical analysis. What we are doing team is using technical analysis to see the behavior of stocks on our watch list and to see behaviors of our watch lists as wholes to understand the broad market.

We’re looking to understand where the big monies are flowing, what those institutional traders, those few people that control the most of the money being traded… we’re looking to understand how they are feeling and where they’re taking the market. By understanding these behaviors, the insights we gain will make us the best investors that have a leg up against everyone else.

You can only get this type of analysis here folks. Amazingly powerful. It knocks my socks off every day when I think about what we have going for us that no other trading community does.

My Techne January 55 Call closed down today at $3.50 per option. I’m 42% into my initial investment on this one team after only 2 trading days.

Team; tomorrow is a day of heavier news than today. The market movement will be unpredictable. It’s a good day, if you can’t watch the market real time, to sit out on the side lines because anything can happen.

I personally am trying to liquidate my portfolio again capturing as much profit that is available in the here and now. The market is giving mixed signals which makes me feel uncomfortable entering short positions at this time and being in long positions at the same time. So, I rather take what I can and then wait patiently.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Back-To-Back Distribution Day Force A Bearish Trading Bias

2005-10-05T23:57:00.000-06:00

Back-to-back distribution days force us to lower our trading bias to Bearish. The ISM services index dropped a record amount. Indexes dropped below their 200 day average. Is a technical rebound possible? Never anticipate or speculate. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Wednesday, October 5th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

A back to back distribution day; that’s what today was team. Perhaps spurred by the Institute for Supply Management’s service index dropping a record amount, perhaps spurred by oil dropping – and all energy related stocks dropping - on word that demand has been curbed drastically, or perhaps just on the long term negative buildups of events that’s been backing up in the cue without being faced… till today that is.

Suffice it to say, all but our NASDAQ index, dropped through major levels of support. Many 200 day simple moving averages were breached. All Williams %R indicator shot to extreme oversold. I had to drop our overall trading bias to Bear from Neutral.

Now this is the time that separates the real investors from those that can’t separate themselves from their emotions. It’s during these times of bias changes, when exiting long trades, no matter what – I’ll be it, take some time and exit elegantly, grab as much profit and minimize as much loss as you can… but when the bias goes bear, being long is wrong. Instead you want to be short.

Follow the trend. I’ve seen so many investors revert to their emotions saying to themselves… this downtrend must be temporary. That’s speculative, wouldn’t you say team? More times out of not, those investors are wrong and they loose their shirts. I’ve done it a number of times myself. Don’t fall prey to that type of thinking. Follow what you see and know not what you feel and think.

If next week, our bias turns bullish again, no worries, exit your short positions and go long. And, by the way, a technical rebound is possible and highly probable. Learn to roll with it. But never anticipate or speculate. The point is, if you are long right now, look for your exits. And, at this point, look for short entries.

I sold my Autodesk November 45 Calls, after receiving a trailing stop loss alert, at $3.00 per option. My return on invested capital is 58% after being in the trade for 8 days. I sold my Joy Global November 50 Calls, after receiving a trailing stop loss alert, at $3.20 per option. My return on invested capital is 60% after 8 days. Both very respectable gains team. My Techne January 55 Call closed down today at $4.10 per option. I’m 32% into my initial investment on this one team.

Team; tomorrow is a day of light news which means probably little market movement. So, tomorrow is a day for you to clean up your portfolio. Take your profits where you have them and make the hard decision to cuts some losses. If the market rebounds tomorrow or Friday, so be it. You can get back into you long positions another day. But, the worse thing ever is staying in a clear looser. Again, act on the evidence you see and know not what you feel and think.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Broad Market Reversal On Hawkish Comments From Fed Dove...

2005-10-04T23:45:00.000-06:00

For most of the day the bull continued its climb up the stairs. The bear jumped out the window in the last hours of trading. Hawkish comments from a Fed dove triggered the reversal. Will this be temporary? Be diligent with your stop loss orders on long entries. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Tuesday, October 4th with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Alright team, who watched the market today? Till the afternoon the day was fairly bullish following the same path as the previous days… we were on a slow bullish rally, regaining territory we had lost in the past. Then, that saying came true for us again. The bull indeed was coming up the stairs when the bear… that bear jumped right out the window.

What was the subject that caused the reversal? Why, it was interest rates of course. One of the members of the Federal Open Market Committee that votes on interest rates, a gentleman that typically is an advocate of refraining from raising rates, made a comment today that not only is the fed going to continue to raise rates, but at this point inflation is not being well contained by only quarter point hikes, or so was the jist of what he said. And, of course the market reacted negatively to that. Wouldn’t you?

From a technicals perspective we lost all sorts of ground with prices of the indexes closing below levels of support and below key moving average milestones. Looking as well at our TradingTrainer.com technicals reports, you’ll see the indexes have again returned, for the most part, back to the bearish side of the house.

Because this was stimulated in such a short amount of time, literally in less than three hours, and it was off a person's comments, it wouldn’t be impossible for this to reverse tomorrow with bargain hunters buying early and maybe combined with a shot of good news to counter the bad, so we’ll keep out trading bias at neutral for the time being and just see what happens tomorrow.

The bid price of my Autodesk November 45 Calls closed down at $3.40 per option. My return on invested capital is 79% after 7 days. The bid price of my Joy Global November 50 Calls closed up at $3.30 per option. My return on invested capital is 65% after 7 days. And, I opened a long position on Techne before the market collapsed. I bought the Techne January 55 calls at $6.00 per option today. The bid price closed down at $4.90 per option. Right out of the gate, I’ve dipped 18% into my initial investment.

Team; as I have been hinting throughout this web log, typically when news of this sort triggers this type of market knee jerk reaction, it has been temporary. So, I’m leaving the trading bias where it is till we see either a reversal or follow thru on today’s movement.

What a move like this does do, however, is put me on the defensive. For tomorrow, I will have my trailing stop loss alerts in place on my AutoDesk and Joy Global call options as well as my static stop loss alert on Techne. And, instead of looking at charts to go long on, I’ll instead be just watching the broad market from the sidelines ready to react on positions in my own portfolio.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Conflicting News Reports Give Little Direction...

2005-10-03T23:35:00.000-06:00

Today there was conflicting news on how the economy is doing. Growth is up. But, so are prices paid. The small caps led. Will the large caps catch up? Pass on entries that aren't compelling. Click here to get today's free options advice; have A.J. explain option trading to you in everyday language.

Hey trading team,

This is A.J. on Monday, October 3rd with your Trading Trainer web log. We are your home of market insights for the serious options trader. This web log will cover the events in the market from today as well as prepare you for watching the market tomorrow.

Today was down, but it was up. What does that mean? Well, the ISM manufacturing index jumped a record amount not seen since 1991. That excites people who like to hear about growth. Now the bad news, at the same time, the prices paid index has had the biggest two month rise since 1972. That scares people worried about inflation.

Construction spending came in a little less than expected. Semiconductor sales came in a little higher than expected. The auto makers saw their sales drop incredibly. And the long bond interest rates are up to a 7 week high.

From a technical’s perspective, we will start with the broad market… small caps led the way on a bullish rally while the large caps meandered behind with a flat to slightly down day – probably in part due to the automakers. Volume on the NASDAQ exchange ticked up a notch while the NYSE stayed at the same level of volume action that happened last Friday.

Now, looking at our watch list, for the most part our watch list had an up day. Our reactive, buffered and Chaikin templates are definitely tending bullish. The big thing we’d like to see right now with respect to the index charts we use to determine the broad market direction… what we’d like to see is the 7 day averages cross up above the 30 day averages. That would be the next milestone.

The bid price of my Autodesk November 45 Calls closed up at $3.50 per option. My return on invested capital is 84% after 6 days. The bid price of my Joy Global November 50 Calls closed up at $3.20 per option. My return on invested capital is 60% after 6 days.

Team; the question for the day is, will the large caps catch up with the small caps. Right now we are relying on the stock and its charts to determine if it has what it takes to make it on its own. With the broad market in a bullish funk, for lack of a better word, there is no extra push to our stocks so they for sure better make it on their own, yes? And, we need to be more realistic, without that underlying pump, we can’t expect always to double our money… it’s possible but our target could be closer to 50%. In fact, tomorrow, I’ll have trailing stop loss orders set on my Autodesk and Joy Global options. Trailing stops are what I use when a stock has passed my profit target in gains.

Tomorrow, I’ll also be watching Garmin - ticker GRMN - and Techne - ticker TECH - for possible entry points. But, I am fully aware that right now we have to play it day by day. So, if an entry is not compelling, I am prepared to pass. Do you agree team?

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and money making. Trading Trainer is here helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear the blog as an audio from A.J. himself!

Will The Market Break Out?

2005-10-02T23:18:00.000-06:00

Neutral trading bias still. Look at resetting
profit targets. Will the bull climb the stairs
some more? Perhaps use stop alerts, not stop
orders. Get the latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Sunday, October 2nd with
your Trading Trainer web log. We are your
home of market insights for the serious options
trader. This web log will cover the events in the
market from this past Friday and last week as
well as prepare you for watching the market
tomorrow.

Last week had the sentiment of a negative week.
Yet, the trading indexes that we use to gauge the
broad market all gained over 1% and in some
cases more than 2%. It is hard for me to believe
the resilience of this market. Suffice it to say,
the 30 day moving averages of the DOW,
NASDAQ and the S&P 500 have gone flat to
positive. For sure the market is in a neutral
trading bias. Let’s review what that means
team. It means we need to trade stock charts on
their own merit because there is no underlying
push coming from the broad market. And, as a
result of the aforementioned point, we need to
set a more realistic profit target on our trades.
Rather than expecting to double our money on
every trade, perhaps a better target is to make
50% return on invested capital.

The bid price of my Autodesk November 45
Calls closed up at $3.30 per option. My return
on invested capital is 74% after 3 days. The bid
price of my Joy Global November 50 Calls
closed up at $2.95 per option. My return on
invested capital is 48% after 2 days.

Team; the big question on my mind is whether
the broad market will continue on last week's
slow paced rally. Will that bull continue to
come up the stairs, if you will. In the meantime,
I’ve surpassed my 50% target on Autodesk so I
am going to set a trailing stop loss alert starting
20% below the opening price. As for Joy
Global, I’m bumping up my static stop loss alert
to 25% to guarantee that return. All my stop
loss alerts are calibrated on the bid price. And
they are alerts, not orders. Finally, tomorrow, I
am going to scan our whole watch list for
consolidation patterns that are set to break out.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Watch for volatility as news hit!

2005-09-29T23:25:00.000-06:00

Small caps moving up alongside large
caps. More movement to the market today.
Be prepared for anything, as news may
bring volatility. Looking for bullish
movement indicators. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Thursday, September 29th with
your Trading Trainer web log. We are your
home of market insights for the serious options
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

Well team, despite all the oil woes, today the
markets flexed their muscles. We saw some
nice performance from our small caps
especially. The small caps were the ones that
were lagging in the first half of the week behind
the large caps that were slowly building back up
– the bull coming up the stairs if you will. So,
although the newspaper article writers and even
some analysts are surprised by today’s action,
are we, team? I hope not. We have been
watching the technicals all week and I’ve been
saying, when we see price gap up an average of
1% among the indexes on heavier volume, we’ll
know that the market is ready to make another
bullish run of things. In fact, with the DOW and
the S&P 500 stretching up above their levels of
resistance, the DOW moving up above its 200
day average once again and the NASDAQ and
the S&P 500 moving up above there 50 day
averages once again… we seem to have passed
many of the short term tests I had put out there.
I have immediately bumped the bias up to
neutral today. Now we’re looking for some
more conviction like Chaikin and MACD
crossing and long trends. Keep your eyes peeled
team. Be ready for anything.

Team, we know we are in the fall season... we
have a healthy chunk of news being released
tomorrow morning to end the week on.

The bid price of my Autodesk November 45
Calls closed up at $2.50 per option. My return
on invested capital is 32% after 2 days. The bid
price of my Joy Global November 50 Calls
closed up at $2.10 per option. My return on
invested capital is 5% after 2 days.

Team; today we saw some respectable gains on
heavy volume. The question is, with all the
domestic disarray happening, can the market
follow through on today’s gains. And with the
news being released tomorrow morning, there’s
bound to be some volatility. Besides setting
some exit rules on my own positions, I think for
me, tomorrow will be a day to sit back, watch and
enjoy the show.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Gold Prices Soaring!

2005-09-28T23:29:00.000-06:00

Gold Prices reaching $500, showing its
value, but worrying some. Flat market
makes profits harder. Look for upcoming
movement on flat market. Also what I’m
involved in. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Wednesday, September 28th with
your Trading Trainer web log. We are your
home of market insights for the serious options
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

Team, price is slowly creeping up in the broad
market. At least on the larger cap stocks. Oil
prices continue to appreciate taking with them
energy related stocks. Team, you have to see
that Gold is pushing the 500 dollar mark. Gold
is an indicator of people’s confidence. If people
aren’t confident, they buy gold… because if all
heck were to break loose, and all the currencies
out there today that are only backed by good
faith… like the U.S. dollar, and pretty much all
the rest… if they all became worthless, gold
would still be worth something because since it
is a precious metal, it inherently has value, it’s
scarce. So, we watch the price of gold. Right
now it’s going up and up and up and that has
some worried. For us team, would we worry if
the broad market started declining? No,
because we know how to use our options to
trade short positions. In fact, the most trying
time for us team is times like right now, where
the market’s indecision keeps the broad market
with a neutral stance and therefore doesn’t give
us any extra push on our stocks to really
supercharge our gains.

The bid price of my Autodesk November 45
Calls closed up at $2.00 per option. My return
on invested capital is 5% after 1 day. The bid
price of my Joy Global November 50 Calls
closed down at $1.60 per option. My initial
investment is down 20% after 1 day.

Team; although we keep getting flat price
movement, it is on heavier volume. It reminds
me of a drag strip. Imagine when the drivers are
lined up ready to race down a quarter mile track.
What do they do while waiting for the start
signal? They rev their engines real high and spin
their rear wheels while having their brakes on.
They go no where… but as soon as the signal is
given, they rocket down the track. Right now,
with all the volume and no price movement, the
energy is building for a breakout. The million
dollar question on all our minds is in which
direction will it go. When the broad market
moves it will affect the underlying stocks. So…
we need to be prepared. Use stop loss orders on
open trades to protect investments and profits,
and when you see a confirmed signal, act on it.
Pre think your moves so you can act fast.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Tread Lightly In Neutral Market

2005-09-27T23:14:00.000-06:00

Equal pressure is shown in broad market.
Watch for bull market to keep going
despite movement. Lower profit targets
help in time of indecision. Also what I’m i
nvolved in. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Teusday, September 27th with
your Trading Trainer web log. We are your
home of market insights for the serious options
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

An interesting phenomenon happened with the
broad market today. There was equal pressure
from the bulls and the bears. Volume and price
for the most part, across the indexes was flat.
So what does that mean? Well it means the
market just doesn’t know. And neither do us
so we need to tread lightly till a direction
becomes more evident.

I opened two long positions today by buying
calls. I bought the Autodesk November 45
Calls at 1.90 per option. The bid price closed at
1.80 eating into my initial investment by 5%. I
also bought the Joy Global November 50 Calls
at $2.00 per option. The bid price closed at
$1.80 eating into my initial investment by 10%.

Team; today with the flat movement of price,
you would almost think the market petered out
on its current bullish rally. But, team, a
petering out is accompanied by a reduction in
volume. Volume has not diminished. Today
was instead a day of indecision. To cap this
bullish rally off in the short term, what we are
looking to see before the week is out is a day
where price increases by 1% or more on heavy
volume. If we see that, we will be confident in
the rally’s staying power. In the mean time
team, I’ll be looking at stocks the way I did
today... to find those that can stand on their two
feet.

Don’t be afraid to at least paper trade a stock
that looks good despite the broad market’s
indecision. Just be aware that an underlying
push by the broad market is missing and
therefore you need to lower your profit targets
to a more realistic level like 25 to 50%.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Keep Watching Indicators!

2005-09-26T23:06:00.000-06:00

Oil market gets slight boost early, but
diminishes. Neutral bearish market
turning upward slightly. Give it a go on
paper trading today. Watch the volume
and Oscillators. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Monday, September 26th with
your Trading Trainer web log. We are your
home of market insights for the serious options
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

The fact that Rita was well prepared for, lost a
lot of energy before hitting land, and spared a
lot of the oil rigs and refiners sparked an early
morning rally. But then, the long term effects
of oil being tight set in and the rally was
quenched. The small caps led the way today.
The small-cap S&P 600 as well as the Russell
2000 made some very nice gains. Looking from
a technicals perspective the broad market looks
to have hit a bottom last Thursday and since
then has been on a pseudo rally. Some things to
look out for in the short term to confirm the
rally might be a price movement of over 1% on
volume that is heavier than the 200 day average,
price being above the 200 day average and the
Chaikin Oscillator crossing up above its zero.
For the long term, we’re looking for the 7 day
moving averages to cross up above the 30 day
moving averages, that MACD to cross up above
its MACD average, and for the 30 and 40 day
averages to trend up for 20 day straight. Right
now we’ll be keeping our trading bias at neutral
bearish.

Team, like I said in the opening comments, there
are some short term indication I am looking for
with respect to the broad market trend. Till I see
those indications, and I am seeing evidence from
the individual stocks that, till they see those
indications, you can’t put any confidence into
any movement. Remember, volume guides our
movements. If we don’t see heavy volume,
staying on the side lines is a healthy alternative
to loosing money. If you want to try a
speculative trade, by all means, give it a go… in
your paper trading.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Watch out for Rita!

2005-09-25T23:26:00.000-06:00

Oil prices show initial decline, but closed
up. Launching new members only
newsletter. Watch out for now as Rita hits.
Watch the volume and Oscillators.
Get the latest at tradingtrainer.com.

Hey trading team,

This is A.J. on Sunday, September 25th with
your Trading Trainer web log. We are your
home of market insights for the serious option
trader. This web log will cover the events in the
market from this past Friday as well as prepare
you for watching the market tomorrow.

Again, the calmer Rita caused oil prices to
decline, and the initial opening plunge in the
market was reversed to close up. What we’ll
really need to see is how the market reacts to the
damage post Rita come tomorrow. Monday
morning will be all telling. Depending on the
outcome, things will be wild one way or
another. So, if you are in any trades, buckle up,
you’re in for a ride. If you aren’t, it might be
safest to watch from the sidelines.

More exciting I think is the new members-only
newsletter we’re launching today. First, we,
here at TradingTrainer.com are just about to tie
the knot with both the Investors Business Daily
newspaper and the Dow Jones Market Watch
Online service to have their news feeds, exactly
when they are released, plugged directly into our
newsletter. Now if those aren’t the best sources
of news highlights, I don’t know what is.
Second, the Trading Index Stats section has been
redesigned. We are watching six indexes now,
not just three. In addition to the Dow, the
Nasdaq and the large-cap S&P 500, we’ll be
watching the mid-cap S&P 400, the small-cap
S&P 600 and the Russell 2000. And, for each
index we now have a graphic dashboard that
will quickly tell you how the index is doing for
the day and the week. Finally, in the trading
index stats section, we have moved away from
static charts and audio. There is a single button
now that says, “View the indexes analysis right
now…” When you click that button you will be
brought to a flash video where instead of having
you look at a static chart while I talk, you can
look over my shoulder on to my computer and
see how I analyze the indexes. Third, the Charts
of Interest section is now using that flash video
technology as well. There is a button for each
ticker. Today, I only did an analysis on
Pacificare Health Systems, ticker PHS. That
means there is only one flash video today. On
many days there will be more. Anyway, what all
these changes mean is…well, that this base
audio commentary will be significantly shorter
and you will have a more interactive experience
when it comes to charting. Team, thanks to you,
we here at TradingTrainer.com have been able
to take it up a notch. We’re delighted to be here
because of you and we won’t ever stop getting
better.

Tomorrow is going to be a lot of watching and
reacting to the damage of Hurricane Rita. The
broad market is teetering between biases right
now, and it’s not safe for me to open an
positions at this time for should the broad
market reverse, I’ll be caught with my pants
down. I’ll be sitting back and watch tomorrow.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Slight boost as Rita Calms!

2005-09-22T23:18:00.000-06:00

Rita’s calming sends gas prices lower. Small rally
on low volume today. Trends or reactions to
oversold positions? Watch the volume and
oscillators. Get the latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Thursday, September 22nd with
your Trading Trainer web log. We are your
home of market insights for the serious option
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

So Rita calmed a notch down which sent oil
prices down off their daily highs, and in turn the
market rallied somewhat although on lighter
volume. In fact, everything flip flopped. Oil
and mineral stocks dropped. Builder and retail
stocks gained. So, what did we see here?
We’ll, the Dow and the NASDAQ hit horizontal
support and rebounded off. As well, the Dow
formed a key reversal up price pattern. The
question in my mind is, we were at such
extreme oversold positions… is this what
happens when you release the pressure? Is it a
reaction or a trend change? We can’t bank on
anything today. While the market is deciding,
it’s probably best if we sit on the sidelines till
our confidence increases.

Tomorrow is going to be a lot of watching and
reacting to Hurricane Rita. From my
perspective, it’s all about finishing out the
week. My intention tomorrow is to start my
weekend early.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

The Bear Jumps Out The Window!

2005-09-21T23:26:00.000-06:00

Bear market making its way into town. Try to
avoid long term trades. Bear market means drop
in trading bias. Look out for Rita. Watch the
volume and oscillators. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Wednesday, September 21st with
your Trading Trainer web log. We are your
home of market insights for the serious option
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

I’m going to recite a quote that I learned from
Robert Kiyosaki a while back. "The bull climbs
up the stairs while the bear jumps out the
window." What that is referring to is that a bull
market, an appreciating / ascending market
typically gains slowly – it climbs up the stairs if
you will. A bear market, a depreciating /
descending market typically crashes – it jumps
out the window if you will. We’re seeing the
bear jump out the window. Those key reversal
downs that I’ve been talking about all week, that
we identified on the weekly charts just this past
weekend, were spot on. And why should we
question them? They’re price patterns for gosh
sake.

So here is a test of a real trader, when a market
reverses like this… what do you do? I’m sure
many of you team, despite my warnings over the
last three weeks are in long positions. Now,
mind you, if were talking energy stocks, you’re
probably okay. Any others, especially retail or
housing… well we’re at the moment of truth.
These transitions are where I see even the most
experienced traders lose it. No one is ready to
cut their loses. So they wait it out. Team, nine
times out of ten, the ones that wait it out, go
broke. Think about it.

Anyway, with the 7 days crossing below the 30
days and just about every other indicator we use
signaling bear, I’ve done something I don’t
usually do, I’ve dropped our trading bias again.
We’re sitting at neutral / bearish now on two
out of the three major indexes we watch. I had
to. We’ve dropped almost to pre rally levels.
We’ve had distribution days left and right.
Signals are that this bear run will be short. But
it will be a decline none the less, and even you
folks that are out in January with your long
positions will be hard pressed to break even by
expiration. Think about it.

Tomorrow, again, we’re looking for direction.
We probably will not find it. There could be
some bargain hunters out there driving prices
up, at least when the session opens. There could
also be more profit takers that didn’t get out
today, driving prices down. If your playing the
Hurricane Rita ticket, you’ll be listening to
updates and ready to go long on stocks like
Fording Coal, Western Gas and Alcon. That’s a
little more speculative. On the grander scheme
of things, retail has come to a standstill and so
has builders... if you’re playing that ticket, than
you’ll be ready to go short on stocks like
Hovnanian, JCPenny and others like that. If this
is to overwhelming for you, open up your paper
trading log or use the free program I’ve made
available to members and trade both direction as
paper trades. Whatever you do, don’t do
nothing. Do something. Take some sort of
action.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Watch As Analysts Are Wrong!

2005-09-20T23:10:00.000-06:00

Neutral trading bias set. Broad market
not pushing stocks. Look towards builders
and energy. Federal interest rising.
Find how well my trades have gone.
Get the latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Tuesday, September 20th with
your Trading Trainer web log. We are your
home of market insights for the serious option
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

So maybe the market had not digested the rate
hike as was previously thought. I love it when,
again and again, analysts are proven wrong. It
gives me a sense of pride in a twisted sort of
way to know that common sense still works
even put up against the university educated,
manages a large-number research staff, has
direct access to all sorts of data, logic shrouded
and driven, still boils right down to emotion
under it all… analyst’s opinion. See, in the
beginning of the fed’s interest rate raising
adventure, the fed interest rate was sitting at
around 1%. It was great, but everyone knew it
was too good to last. But now, 11 sessions
later and right after a natural disaster that
brought a good portion of the country to its
knees for a week there… there are a lot of
people that are hoping that the Fed was done.
And, so no… the market had not digested the
rate hike. In fact, moving forward, I would not
be surprised, if after every Federal Open Market
Committee meeting, when the fed decides its
next step, if the market doesn’t react. We’re not
all on the same page anymore.

Suffice it to say, the market dropped today, after
starting up – kind of a rebound from yesterday’s
drop – and today's drop, especially with the
Dow below 10,500, had me drop our broad
market trading bias to neutral. If anything, I’m
starting to believe more the key reversal price
patterns we saw on our weekly charts this past
weekend. A neutral trading bias means the
stocks themselves that you choose to follow are
not getting any push from the broad market and
so it better be doing well on its own merits. It
also means, you might consider dropping down
a level of granularity for your pushes – to the
sector level. For instance, with the energy
sectors doing so well, perhaps looking for long
positions on energy stocks is in order. Another
example is builders. With builders suffering
from higher interest rates and the potential
softening of the real estate market, perhaps
looking for short positions on builder stocks is
in order.

Whatever your strategy, some more
conservative trading rules are required. First,
we need to lower our profit expectations. I’m
now only looking for 50% return on my
invested capital versus 100%. Second, we need
to be fast, especially with exit strategies. In a
neutral trading bias, we want to be taking profit
more times than waiting for follow through.
We want to err on the side of taking profit and
staying out of trades, versus waiting dips out
and jumping into every trade possible.

I sold my Tenaris October 105 Calls today. I
closed that long position by selling my calls at
$18.00 an option. After 25 days, my return on
invested capital came to 128%. At this point,
my option trading portfolio is empty. Even with
the loss on Quicksilver, I still made out like a
bandit this round. On to the next round. Bring
it on..

Tomorrow will be interesting team. There
could be some bargain hunters out there like
there was today driving prices up, at lease when
the session opens. There could also be more
profit takers that didn’t get out today, driving
prices down. There’s nothing to guide us;
except for the Energy department report on oil
stockpiles – which if still low, will send energy
stocks up and the rest of the market down. We
also have Rita to watch. Anyway, when there is
no underlying sentiment, I like to take a break.
That is most likely what I will be doing
tomorrow, just watching and enjoying the
antics. I think I’ll take tomorrow and just have
some fun counting the money I made from this
last round.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Watch That Oil!

2005-09-19T23:42:00.000-06:00

Oil prices explode as new storm enters
picture. Waiting to see what Feds say.
Keep an aye on DOW for a push in broad
market. A good day as I close a trade
today. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Monday, September 19th with
your Trading Trainer web log. We are your
home of market insights for the serious option
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

There was no news today. The quadruple-
witching effect from last Friday had warn off.
Volume dropped. There’s another storm in the
Caribbean that investors are speculating
about… they're thinking it’s on its way to the
Gulf, this time to Texas to deal another deadly
blow to domestic oil production and refining.
The price of oil shot up by the largest flat value
in history. The stock market retreated on the
news. Everyone wants to know what the Fed is
going to say tomorrow. Most people stayed on
the sidelines today in anticipation..

I personally am still perplexed by the key
reversal down patterns that we identified on the
weekly price chart this past weekend. Those
patterns are signaling down times coming up in
the not too distant future and lasting for a while.
We will need to monitor that.

As for today, I threw out a real high selling price
for my EOG Resources options right at the tail
end of amateur hour and wound up getting the
price I had asked for. The morale is, you'll
never get what you want if you don’t ask. And
during amateur hour anything is possible. All
that is left in my portfolio now is my Tenaris
options. They appreciated nicely today so my
trailing stop loss order did not trigger. Until the
broad market indexes blow through their
respective levels of resistance, 10700 for the
Dow, 2,200 for the NASDAQ and 1,245 for the
S&P, opening long trades based on a trend
following templates will not really be my focus.

Like I said earlier, I sold my EOG resources
October 60 calls today at $14.10 an option. My
return on my invested capital came in at 127%
for 59 days. Not bad. My Tenaris October 105
Calls closed higher at $15.90 an option. I’m in
the black with a return on my invested capital of
101% after 24 days in the trade.

Team, the focus tomorrow will be on what the
Fed says in the afternoon. Not so much their
actions, but more about what they say. Right
now team we can’t count on any extra push
from the broad market. A push up would
happen if the Dow would break up through
resistance at 10,700. A push down would
happen if the Dow would break down through
support at 10,500. Right now I am very close
to dropping our trading bias, across the board to
neutral. At this point any trade you make is
really going to be based on just the merits of the
underlying stock itself. Pairing back your profit
targets at a time like this is called for.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

To Bull Or To Bear, That Is The Question!

2005-09-18T23:30:00.000-06:00

Quadruple-witching hour happened
Friday. Bullish or bearish market ahead?
Oil prices retracting as supply increases.
Learn from my Quicksilver trade. Get the
latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Sunday, September 18th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from this past Friday as well as prepare you for
watching the market tomorrow.

The quadruple-witching hour – the curious event
that happens once every three months – it happens
on the third Friday of March, June, September and
December – it’s the event where contracts for
stock index futures, stock index options, stock
options and single stock futures all expire –
caused a ton of volume to be traded on this past
Friday. A lot of shares were trading hands. As
well, Friday was the first day that the S&P 500
went to its new algorithm on how it chooses stocks
to be calculated within its index. It is no
longer based solely on market price. Now, it has
more to do with shares a company has available for
trade. In other words, things were topsy tervy on
Friday.

Here’s what I see that is hard for me to figure
out. On the weekly charts for our indexes, for
the Dow and the NASDAQ, we got key reversal down
patterns on heavy volume. That is where the intra
week high was higher than the previous week’s but
the close was lower. That forecasts a trend
change in the bearish direction. On the contrary,
the weekly chart for the S&P 500 gave us an upside
down Lincoln’s hat pattern. That forecasts
bullish times ahead. Although the patterns were
on heavy volume, none of them were distinct enough
to give me any guidance. And, I’m leery about
Friday’s price movement and volume as well. The
only thing I’m currently not leery about is the
price of oil. With demand dropping and supply
increasing price seems to be retreating.

I’m sticking to my guns team. Till I see the
indexes break through those resistance levels, I
am apprehensive about opening long positions right
now.

Okay team; let’s change gears a little bit. I
want to do a post mortem on Quicksilver – ticker
KWK, my worst trade of the year. Let’s look at
Quicksilver using our Bollinger band and butterfly
pattern template. When the Bollinger bands
constrict, we know an impending breakout is near,
we just don’t know it which direction. When the
20, 10 and five day exponential averages start to
collapse on each other – we call that a butterfly
pattern – we know an impending breakout is near,
again, we just don’t know in which direction. We
watched that pattern build with Quicksilver
through July and the beginning of August. We had
our alerts placed such that if price closed below
the lower Bollinger band, we were prepared to buy
a Put. Or, if price closed above the upper
Bollinger band, we were prepared to buy a Call.
We finally got it on Tuesday August 16th. That
was our signal to open a short position. And
since crossing below the Bollinger band was what
signaled us to go short, closing above the
Bollinger band was what would signal us to close
the short position. That happened on Thursday,
August 18th. From the close on Tuesday, August
16th to the close on Thursday, August 18th, we got
95 cents of underlying stock price movement which
translated to our option having a 50% return on
invested capital. This is where I broke my own
rule. The signal came telling me I should exit.
I didn’t. I lost. Team, the most important
signal to exit a trade is the indicator that
brought you in. Above and beyond that you may
employ a stop loss strategy. I broke the major
rule of exits. On top that, I didn’t cut my
losses at my low level. That was rule number two
broken. So, in an option that was a quick win,
50% return on invested capital in 2 days, I
extended the trade to 30 days and wound up loosing
91% of my initial investment. Team, this is
deplorable and a perfect example of what you
should not do.

My EOG resources October 60 calls closed higher at
$11.00 an option. My current return on my
invested capital is 77%. I’ve been in that trade
for 56 days. My Tenaris October 105 Calls closed
higher at $14.70 an option. I’m in the black with
a return on my invested capital of 86% after 21
days in the trade.

Team, typically before the Tuesday where the Fed
announces interest rate changes, the market is
quiet. I expect that tomorrow. This is not a
good time to be opening new positions because
there really is little to guide us. So for me,
the sidelines it is. I’ve got trailing stop loss
orders to setup on my EOG resources and Tenaris
options tomorrow. I’ll be setting them initially
for 15% below the bid. If they appreciate more
tomorrow, all well and good. If they depreciate,
I’ll take my profits and be content with profits
over 50%.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Uncertainty Brings Little Price Movemant!

2005-09-15T23:25:00.000-06:00

High volume but little price movement.
Many moving money into Gold as inflation
looms. Forecast: tomorrow an up day.
Check out charts on ticker FDG. Get the
latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Thursday, September 15th with
your Trading Trainer web log. We are your
home of market insights for the serious option
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

Okay… let’s think about what happened today.
We had heavier volume, in some cases up to the
100 day average. We had very little price
movement from open to close. So what the heck
is happening? We had our first wave of Katrina
victims sign up for unemployment. We had our
consumer price index tell us what the producer’s
price index told us on Tuesday, which is that the
high energy prices have yet to penetrate into the
costs of everything else; which is considered good
news. And, we had our New York and Philly Fed
manufacturing indexes say their respective
growths have spiked down; which is also
considered good news for those that fear inflation.
But, probably what the market chose to focus on
what the fact that those same manufacturing
indexes also pointed towards way higher
manufacturing costs and way higher outlook for
costs in the future. That shot the fear of inflation
right into all investors. We could see that by the
record number of investors moving their money
into precious medals like gold.

From a technicals perspective, today the Dow
formed a key reversal up price bar pattern,
forecasting tomorrow to be an up day. I’m still
not ready to re-calibrate our levels of support and
resistance on our index charts. And, I don’t want
to bring down our trading bias just yet. I want to
evaluate the weekly chart, over the weekend
before making that call.

Team, the Fording Canadian Coal charts - ticker
FDG are perfect text book examples of how to use
templates to trade. Each template we use has its
own personality; its own style. They all do
basically the same thing. They each have their
plusses and minuses… but if you were on the ball,
you would take these four charts for Fording
Canadian Coal and study them forwards and
backwards. This is it team. This is the technical
analysis we use to win – and win big at options.
Learn it. Do it. Get good at it. Okay?

My EOG resources October 60 calls closed higher
at $10.50 an option. My current return on my
invested capital is 69%. I’ve been in that trade for
55 days. I sold my Pacificare Health Systems
November 75 calls today at $3.80 an option for a
final return on my invested capital of 31% after
being in the trade for 55 days. My Quicksilver
September 40 Puts closed flat at $0.10 an option.
Tomorrow’s my last day to do anything with that.
I’m in the red with a return on my invested capital
of -94% after being in the trade for 29 days. My
Tenaris October 105 Calls closed higher at $12.20
an option. I’m in the black with a return on my
invested capital of 54% after 20 days in the trade.

Team, we may see a rally in the blue chips
tomorrow. I’m only saying that because today we
had a heavy volume stale mate between the bulls
and the bears and the Dow gave us a key reversal
up pattern. It’s going to be fun to watch. I’m still
trying to make the most out of my portfolio. And,
I don’t see myself opening any trend following
trades till the indexes have broken through those
heavy lines of resistance we talked about earlier in
the week. I do have my eye on Apache - ticker
APA tomorrow, for a quick win.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

The End Of Our Bullish Market?

2005-09-14T23:18:00.000-06:00

Decline as news hits. Energy stocks up
still. Bullish run could be over. Market
bounces off line of resistance. Take a look
at Techne templates. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Wednesday, September 14th with
your Trading Trainer web log. We are your
home of market insights for the serious option
trader. This web log will cover the events in the
market from today as well as prepare you for
watching the market tomorrow.

Today we got another decline. A flip-flop if
you will. Last week oil was declining and
instead techs were getting the attention. Today,
like I said yesterday, the oil report and the less
than favorable retail sales report hit investors
like a ton of bricks. Not good for the broad
market as we logged another light distribution
day being led by small-caps and tech stocks.
But, of course, me being in energy options in
my portfolio, for the most part it was good for
me.

From a technicals perspective, the indexes
declined below levels of support today as well
as moving averages. And, we had two Chaikin
Oscillators cross down below their zeros today
which is a signal that the bullish run is over. I
have yet to pull down our levels of support and
resistance because this decline is abrupt and
brand new to us. And, historically, when the
broad market goes to extreme oversold so fast,
it is typically temporary. I want to wait it out on
the side lines. As well, I’m not ready to drop
our trading bias just yet. I want to play it calm,
cool and collected.

Team, the Techne charts - ticker TECH are great
examples of how to use templates to trade.
Each template we use has its own personality;
its own style. They all do basically the same
thing. They each have their plusses and
minuses… but if you were on the ball, you
would take Techne and study the template charts
forwards and backwards.. This is it team. This
is the technical analysis we use to win – and win
big at options. Learn it. Do it. Get good at it.
Okay?

My EOG resources October 60 calls closed
higher at $9.80 an option. My current return
on my invested capital is 58%. I’ve been in that
trade for 54 days. My Pacificare Health Systems
November 75 calls closed higher at $3.60 an
option. My current return on my invested
capital is 24% after being in the trade for 54
days. My Quicksilver September 40 Puts closed
lower at $0.10 an option. I’m in the red with a
return on my invested capital of -94% after
being in the trade for 28 days. My Tenaris
October 105 Calls closed higher at $11.10 an
option. I’m in the black with a return on my
invested capital of 41% after 19 days in the
trade.

Team, the broad market indexes bounced off
those levels of resistance again and have
plummeted. We need to see if this is a
correction or a full on trend reversal. I am not
opening any long positions till this scenario
plays on. Right now, my goal is to get the most
out of my existing portfolio and to back test
stocks to learn like I did today with Techne.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

The Tail Is Wagging The Dog!

2005-09-13T23:17:00.000-06:00

Your guess is as good as mine. Look for
waves tomorrow, good or bad. Keep looking
at those charts, Tenaris a good example.
Watch for breaking of resistance on market.
Get the latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Tuesday, September 13th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching the
market tomorrow.

It happened like I said it would, yesterday. The
market for sure was more volatile today than
yesterday. There is a lot of confusion going on; a
lot of uncertainty. How bad was the disaster in the
Gulf? Was it 10,000 dead or 200? How bad is the
energy situation? Is demand softening? Is the oil
and gas supply from the Gulf resuming? What’s the
situation with inflation? Do we need to worry
about the Fed raising rates to keep it at bay? If you
haven’t noticed, no one has a clue. If they did, than
their answers wouldn’t keep changing on a daily
basis. What does this do… well, it makes people
really tired. It’s like they’re always chasing the
answers. The population when surveyed seems
sour on the whole thing. All this back and forth
affects people’s behaviors in their investing life.
When that happens in mass, you can see it in the
broad market movements. Last Friday was for sure
an accumulation day. Today was somewhat of a
distribution day. Right now investors are lagging
the news rather than leading the news. The tail is
wagging the dog versus the dog wagging its tail.
The question is how much quiet time does the
market need? Right now there is so much influence
on the stock market; gauging market direction
through trend following charts is difficult. We have
to resort to price patters like the Lincoln hat’s that
formed Monday forecasting today would be a down
day.

Team, I’m still in my stocks because tomorrow’s
reports about retail sales and from the energy
department on oil reserves will make substantial
waves that I plan to catch.

Team, apply technical templates to Tenaris - ticker
TS. Each template has its own personality; its own
style. They all do basically the same thing. They
each have their plusses and minuses… but if you
were on the ball, you would take Ternaris and study
the templates forwards and backwards. You’d go
through them over and over till you could do it
yourself. This is it team. This is the technicals we
use to win – and win big at options. Learn it. Do it.
Get good at it. Okay?

Let’s check out the example portfolio section. My
EOG resources October 60 calls closed lower at
$9.10 an option. My current return on my invested
capital is 47%. I’ve been in that trade for 53 days.
My Pacificare Health Systems November 75 calls
closed lower at $3.50 an option. My current return
on my invested capital is 21% after being in the
trade for 53 days. My Quicksilver September 40
Puts closed lower at $0.20 an option. I’m in the red
with a return on my invested capital of -88% after
being in the trade for 27 days. My Tenaris October
105 Calls closed lower at $10.60 an option. I’m in
the black with a return on my invested capital of
34% after 18 days in the trade.

Team, until the broad market indexes break above
those levels of resistance… for the Dow we are
talking 10,700, for the NASDAQ we are talking
2,200 and for the S&P500 we are talking 1,245, I
am going to be very leery of opening any long
positions. The only stock I am currently interested
in is Mentor – ticker MNT. But even then, it’s only
out of curiosity. Nope, right now, my goal is to get
the most out of my existing portfolio and to back
test stocks to learn like I did today with Tenaris.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Indicators Point To Bullish Market!

2005-09-12T23:21:00.000-06:00

Market holds onto last weeks gain. Producers
price index coming out, expect volatility.
Bullish market anyone? Perhaps set ROI to
50% instead of 100% Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Monday, September 12th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching the
market tomorrow.

The most impressive thing that happened today is
that the market held on to last weeks gain. There
was a high probability of a reversal today. That
did not happen. What did happen is that with all
the big acquisition news coming from tech stocks -
like Oracle acquiring Siebel and EBay acquiring
Skype - and oil again deflating as news of demand
for oil softening is rumbling around, techs shot
up and energy stocks moved down. The NASDAQ and
the small-cap S&P 600 gained. The S&P500 and the
DOW stayed flat. Volume increased on the NASDAQ
exchange. Volume decreased on the NYSE. Also,
today was a no news day. That could contribute to
the explanation on why the blue chip contingent of
the broad market was flat. Tomorrow we get the
producers price index which is bound to either
aggravate or relieve investors fears of inflation.
No matter which way, tomorrow will be a more
volatile day than today.

Coming from a technical perspective, let's count
up all the bullish signs the broad market has
given us in the last two weeks. We have all three
indexes trading above their averages. We had
Chaikin Oscillator crossing above its zero with
respect to all three indexes. We had MACD
crossings above its MACD averages with respect to
all three indexes. Today we had moving average
crossings with respect to all three indexes. And
all three indexes followed through on the counting
method to determine a market bottom. So what are
we waiting for? Why aren't we calling this a full
on bullish trading bias? The answer is because we
need a strong trend to build. We're trend
followers after all. Two weeks is not enough to
call a trend. So till then, our bias will remain
neutral-bullish - which means tend long but
realize the broad markets aren't there to bolster
the underlying stocks. Rather, the stocks are
much more on their own. With that said a
neutral/bullish trading bias usually means setting
your profit expectation to something lower that
when the market is rallying. Perhaps 50% return
on invested capital versus 100% return on invested
capital. Think about it.

My EOG resources October 60 calls closed lower at
$10.50 an option. My current return on my
invested capital is 69%. I've been in that trade
for 52 days. My Pacificare Health Systems November
75 calls closed lower at $4.60 an option. My
current return on my invested capital is 59% after
being in the trade for 52 days. My Quicksilver
September 40 Puts closed higher at $0.40 an
option. I'm in the red with a return on my
invested capital of -75% after being in the trade
for 26 days. I only have till this Friday to do
anything with those. My Tenaris October 105 Calls
closed lower at $11.20 an option. I'm in the
black with a return on my invested capital of 42%
after 17 days in the trade. My Alcon November 120
Calls were stopped out today. I sold them early
this morning at $6.90 an option. My return on
invested capital came to 10% for being in a trade
for 4 days. I'll take that.

There is no telling how the market will react to
tomorrow producers price index. Here is my plan
for tomorrow. stop loss alerts for EOG resources
and Pacificare Health Systems set at 50% for my
return on invested capital. For Tenaris, if there
are any more declines, I'm done. I've also got my
eye on Mentor tomorrow.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Has 9/11 Hurt Or Helped Market?

2005-09-11T23:50:00.000-06:00

Volume up thanks to institutional traders.
DOW making a move towards all time high.
Keep a good attitude towards the market.
Keep an eye on that 7 day average. Get the
latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Sunday, September 11th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from last Friday as well as prepare you for
watching the market tomorrow.

Our friends the institutional traders were back
out again on Friday as the fall season is taking
hold. Volume really ticked up in the last half of
the trading session. Oil and gas prices dropped
again on Friday which could have been the driver
behind the end of week gains.

Today, as I was reviewing the blog content,
thoughts starting filling my head. I looked back
at some of the notes from over the years. Team, go
ahead and plot a Dow chart for the last 5 years.
Let's go back to the middle of January 2000. That
was when the Dow hit its highest ever at 11,750.
From there the next eighteen months the Dow
descended drastically. On September 10th, 2001
the Dow closed at 9,600. The market reopened on
September 17th, 2001 for a half day. On that day
the Dow suffered its largest one day point drop in
history. The Dow closed that day at 8,900. At
the end of that week the Dow was at 8,200.
What's interesting is, by November of 2001 the Dow
had returned to pre-September 11th levels. By
Christmas, the Dow was at 10,100. And, by March
of 2001 at the conclusion of that rally, the Dow
was at 10,600 - that's 1000 points higher than
September 10th, 2001. After that rally, the
market fell hard in a short time to its post 9/11
lows by October of 2002. However, from there the
DOW has quietly rallied to where it is now, 1000
points shy of its all time high set in February of
2000.

I guess my point is, the terrorist attacks were to
disable the U.S. economy and weaken the confidence
in the U.S. To some degree that has worked. No
one lives the same life they lived pre-9/11. But,
the markets show only strength and stamina.

In July, the Dow made a run above 10,700. It
didn't last. The Dow looks to be setup again,
though. The Dow only needs to gain about 100 more
points for it to be positive for the year. The
NASDAQ made a run above 2,200, which didn't last
as well. The NASDAQ looks to be making another
run at it.

Here's my point in all of this ranting team. If
you are investing in the market the way we do,
take a step back. Look at how the market has been
working. And now, think a moment. you have
nothing to complain about, do you. So, when
people are complaining about this or that, do like
I do, and take the high road. Be part of the
market you invest in and show your strength and
stamina. Sure, you're going to need to react
defensively, such as now, I've made over $34,000
in the last three weeks mostly off of buying and
selling options on energy companies. I know most
of you did, too. But, the gas price at the pump
is $3.00 a gallon. I'm walking more and doing
more at home. I'm reacting defensively. But, I'm
not complaining. I'm making money and I'm alive -
and that makes the world a beautiful place.
Misery loves company but it will bring you down
and skew your perception and then your trading
practice will suffer. Don' fall prey.

Okay enough philosophizing.

My EOG resources October 60 calls closed higher at
$11.00 an option. My current return on my
invested capital is 77%. I've been in that trade
for 49 days. My Pacificare Health Systems November
75 calls closed higher at $5.00 an option. My
current return on my invested capital is 72% after
being in the trade for 49 days. My Quicksilver
September 40 Puts closed lower at $0.30 an option.
I'm in the red with a return on my invested
capital of -81% after being in the trade for 23
days. I only have till this Friday to do anything
with those. My Tenaris October 105 Calls closed
lower at $14.90 an option. I'm in the black with
a return on my invested capital of 89% after 14
days in the trade. My Alcon November 120 Calls
closed higher at $7.30 an option. I'm in the
black with a return on my invested capital of 16%
after just being in the trade for a single day.

No telling how the market will come back after
last week's rally. Here is my plan for tomorrow.
stop loss alerts for EOG resources, Pacificare
Health Systems, Tenaris and Alcon at 50%, 50%, 70%
and break even, respectively, for my return on
invested capital. I'll be setting all these stop
loss alerts after amateur hour and they will all
be in the form of pop up alerts as well as email
alerts going to my inbox and cell phone. And,
they will be triggered upon the bid price of the
option going below a level I set. Also, for all
of these positions I'll be watching where stock
price is relative to the 7 day moving average. A
cross under the 7 day is a secondary alert that
cues me to think about exiting.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Oil Controlling The Market!

2005-09-08T23:26:00.000-06:00

Good volume on NASDAQ. August
export/import prices to be released. Oil
prices controlling movement of the market.
Keep those exit strategies in mind. Get the
latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Thursday, September 8th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching the
market tomorrow.

Today was quite the volatile day for the NASDAQ.
We got a spike up in trading volume for the NASDAQ
thanks to some heavy trading happening for Sirus
and Intel. On the NYSE side of the house, for the
most part, action was subdued. Oil prices bounced
around. What's neat to point out is that when any
one commodity is stretched to the limit, like oil
is right now, it becomes the predominate influence
on the other markets like our stock market. Oil
is up, stocks drop. Oil is down, stock gain. You
know when a commodity is at the highest price the
market can bear, you can see this effect. As for
today, I watched Alcon demonstrate to me the price
and volume movement I wanted to see a couple of
days ago. I opened a long position with Alcon.

Tomorrow, Friday, September 9th at 8:30 am EDT,
export prices for August minus agriculture and
import prices for August minus oil will be
released. This may or may not spur some inflation
fears. We'll have to see. Watching the long bond
yield will give you a clue.

My EOG resources October 60 calls closed higher at
$8.40 an option. My current return on my
invested capital is 35%. I've been in that trade
for 48 days. My Pacificare Health Systems November
75 calls closed higher at $4.50 an option. My
current return on my invested capital is 55% after
being in the trade for 48 days. My Quicksilver
September 40 Puts closed higher at $0.70 an
option. I'm in the red with a return on my
invested capital of -56% after being in the trade
for 22 days. My Tenaris October 105 Calls closed
higher at $15.60 an option. I'm in the black with
a return on my invested capital of 97% after 13
days in the trade. And, today I opened new long
positions by buying the Alcon November 120 Calls.
I bought them today at $6.30 and option. They
closed higher at $7.10 and option. I'm in the
black with a return on invested capital of 13%
after just being in the trade for a few hours.

The move I made by holding off on exiting my
Tenaris trades was a good one. Although the drop
in supplies of oil was less than expected, the
fear that oil recovery in the gulf has slowed,
caused the commodity price to run up and with that
my Tenaris stock ran up as well.

Here is my plan for tomorrow. I'll be setting my
stop loss alerts for EOG resources, Pacificare
Health Systems, and Alcon at 20%, 40% and break
even, respectively, for my return on invested
capital. For Tenaris I'm going to once again
switch exit strategies to a trailing stop loss
strategy and I will begin with setting the stop
loss at 15% below the current price. I'll be
setting all these stop loss alerts after amateur
hour and they will all be in the form of pop up
alerts as well as email alerts going to my inbox
and cell phone. And, they will be triggered upon
the bid price of the option going below the
associated stop level. Also, for all of these
positions I'll be watching where stock price is
relative to the 7 day moving average. A cross
under is a secondary alert that cues me to think
about exiting.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Market Rises To A Neutral/Bullish Market

2005-09-07T23:24:00.000-06:00

Market increases with heavier volume. “Black
Gold” prices drop as Gulf comes back online.
Fed’s may increase interest rates twice this
year. Take a look at the charts. Get the latest
at TradingTrainer.com.

Hey trading team,

This is A.J. on Wednesday, September 7th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching the
market tomorrow.

Stocks started lower today but closed higher on
heavier volume. That was enough follow through to
yesterday's rally that I have bump up the levels
of support and resistance on our index charts. I
also notched up our trading bias from Neutral to
Neutral / Bullish. Quite a few TradingTrainer.com
members have been reporting back to me that they
made amazing gains on long trades in the past two
weeks. I'm ecstatic for them.

Oil prices dropped today on news that the Gulf
Coast was coming back online as far as producing
and refining the black gold, faster than expected.
And, the bond market responded to reports that
inflation fears are still around with yields of
the 10 year long bond bumping up. The expectation
is once again that the Fed is going to increase
short term interest rates two times this year; so
much for a break in the name of disaster relief.

I stayed away from Alcon today. There was no
follow through. Price dropped below resistance at
$120 per share on heavier volume. That level of
resistance is strong; possibly stronger than
expected. We'll continue to watch Alcon as an
opportunity throughout the week.

Team. if you have not looked at the index charts
lately to get a reading on how the broad market is
doing. Today is the day! Look at the charts and
see if you see what I see. Besides a long term
trend, the broad market has confirmed a new rally.
Till we have a confirmed trend, open long
positions with a little trepidation, okay?

Team, did you notice CERN finally broke out of its
consolidation pattern yesterday. Check out that
chart team!

My EOG resources October 60 calls closed higher at
$7.50 an option. My current return on my
invested capital is 21%. I've been in that trade
for 47 days. My Pacificare Health Systems November
75 calls closed higher at $4.10 an option. My
current return on my invested capital is 41% after
being in the trade for 47 days. My Quicksilver
September 40 Puts closed flat at $0.40 an option.
I'm in the red with a return on my invested
capital of -75% after being in the trade for 21
days. And my Tenaris October 105 Calls closed
lower at $13.90 an option. I'm in the black with
a return on my invested capital of 76% after 12
days in the trade.

I held off of getting out of Tenaris after I got
my lagging stop loss alert because I want to see
the effects of tomorrow's energy department oil
stocks report on the market.

This is my plan for tomorrow. I'll be setting my
stop loss alerts for EOG resources at 10% return
on invested capital and for Pacificare Health
Systems, I'll set it 20% return on invested
capital. My stop loss alert for Tenaris will be
set at 65% return on invested capital but, again,
I want to wait for the 10:30 a.m. EDT report. For
all of these positions I'll be watching where
stock price is relative to the 7 day moving
average. Throughout the day, I'll be watching ACL
and AMZN. I have to be honest team, I've still
got the willies. If the energy report is
shocking, I wouldn't be surprised if the market
pulls back. Tomorrow, I'll be more apt to stay
out of new positions taking a seat on the
sidelines than I would be getting in. Just like
yesterday, it would have to be compelling for me
to open a new position tomorrow.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Fed's, Katrina, What Caused The Rally!

2005-09-06T23:40:00.000-06:00

Volume increases today. Temporary events
cause rally in market. Possibility of
bumping up trade bias lines. Unsure about
today’s rally. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Tuesday, September 6th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching the
market tomorrow.

Our friends the institutional traders were out in
numbers today buying up stock shares, driving
stock prices high. Why? Could be that crude oil
prices are down thanks to the subsidies of crude
and its distillates coming from other countries as
well as from the U.S. strategic reserves. Could
be that the sentiment out there is that the Fed is
going to take a pause from raising rates at the
end of this month. It could be the $10.5 billion
that the U.S. government is injecting into the
economy in the form of disaster relief. It could
be that the institute for supply management's
service sector index, pre-Katrina came in higher
than last month versus the estimates which had
everybody set for it to come lower. Or, maybe
it's the retail segment stores that are hinting
that their sales are going to be alright if you
don't factor in Katrina. Now. what do all these
news bits have in common, team? That's right,
they are temporary. So, what do you think about
the rally? How long will it last? This is
definitely something for us to watch. What we got
today was similar to the follow through you need
when pulling off the "counting method to determine
a market bottom". It confirms that a down trend
is over and a confirmed market rally has begun.
The only question in my mind was, were we in a
down trend? I need to wait a few more days and
see if today's gain is sustainable. If it lasts,
I'll be bumping up our trading bias and moving up
our horizontal lines of support and resistance on
our broad market index charts.

My EOG resources October 60 calls closed higher at
$7.40 an option. My current return on my
invested capital is 19%. I've been in that trade
for 46 days. My Pacificare Health Systems November
75 calls closed higher at $4.00 an option. My
current return on my invested capital is 38% after
being in the trade for 46 days. My Quicksilver
September 40 Puts closed lower at $0.40 an option.
I'm in the red with a return on my invested
capital of -75% after being in the trade for 20
days. And my Tenaris October 105 Calls closed
higher at $15.40 an option. I'm in the black with
a return on my invested capital of 95% after 11
days in the trade.

This is my plan for tomorrow. I'll be setting my
stop loss alerts for EOG resources at 10% return
on invested capital and for Pacificare Health
Systems, I'll set it 20% return on invested
capital. With respect to Tenaris, I'm going for
the trailing stop loss strategy starting at 15%
below the after amateur hour price. For all of
these I'll be watching where price is relative to
the 7 day moving average. Throughout the day,
I'll be watching Alcon - ticker ACL - and deciding
based on tomorrow's performance as well as the
broad market performance, whether opening a long
entry would be worthwhile. I have to be honest
team, today's rally after last weeks volatility
gives me the willies. So, tomorrow, I'll be more
apt to stay out of new positions taking a seat on
the sidelines than I would be getting in there.
It would have to be compelling for me to open a
new position tomorrow.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Katrina Raising Energy Stock!

2005-09-05T23:45:00.000-06:00

Customary drop in volume before holiday.
Katrina relief on its way. A review of the
covered call strategy. Waiting to see what
tomorrow’s news brings. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Monday, September 5th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from this past Friday as well as prepare you for
watching the market tomorrow.

Volume dropped significantly on Friday as is
customary before a three day holiday. Energy
prices cooled somewhat on Friday when crude from
the International Energy Agency and the U.S.
strategic reserves was introduced to help buffer
the drop in supply. Also, the Federal Government
will be injecting 10.5 billion dollars into the
economy in the form of Hurricane Katrina debacle
relief over the next couple weeks. Just remember
these one time subsidies often sacrifice short
term relief with long term pain. High energy
prices and the costs to clean up after the
Hurricane Katrina debacle are really powering
speculation that the Fed will hold off on further
rate hikes at least for one session before the end
of 2005. For the week our broad market index
bell-weathers all closed up ending some down
trends with volume weighted key reversal ups.
This upcoming week will be an interesting one. On
Thursday we'll get the first real tally since
Hurricane Katrina came through, of the energy
supplies. I'm expecting reaction to the real
numbers. In the meantime, I've been taking the
long weekend to catch up on some office
organization. Team, nothing makes for an easier
go of trading, than when your office is clean and
organized.

Let's review really quick the covered call writing
strategy. The strategy is, you buy the underlying
stock shares in lots of 100 and then you sell
option contracts on it for the premiums.
Typically, you want to buy the stock when it was
low and then sell the premium when it is high.
The beauty of the covered call strategy is that as
soon as you sell the option, you have locked in
your gains. Because of this fact, covered call
writing is something that I do in my retirement
plans where option trading is not conservative
enough.

See, team every morning I look through our covered
call watch list and look at the near term option
premiums minus the current price of the stock plus
the strike price of the option. I take that as a
ratio to the current price and that will tell you
your current return on invested capital. If I see
any in our watch list that are over 5% I get
excited. And, with Grace (ticker: GRA) having
a channel breakout early last week,.. I got
excited specifically aboout Grace.

Grace's Chaikin Oscillator pulled back on
Wednesday which is when I bought a few hundred
shares of the stock. I paid 10.55 a share. Then,
on Friday I sold the September 10 Call at 1.85 per
call. Now let's due the math. We have two
scenarios when the September 10 Call expires. The
first scenario is that the option is in the money
and I get called out. In that scenario, I buy the
stock at 10.55, I sell the call at 1.85, and I get
called out of the stock at 10.00. That means my
return on invested capital is 1.85 (I received for
selling the option) plus the $10 (I received when
I got called out) minus the $10.55 I paid for the
stock all over the $10.55 I paid for the stock.
So if I'm called out, I make 12% ROI in under
three weeks. Not bad for a retirement fund
investment. Now, the alternative is that the
option is out of the money and I don't get called
out. That means I made $1.85 per stock share and
I get to sell another call again next month as
soon as this month's expires. In fact, it is not
uncommon to write three or four subsequent months
of covered calls before finally getting called
out. It's a beautiful thing. I'll keep you
posted on my Grace covered calls as the third
Friday of September rolls around.

Looking at my current portfolio... My EOG
resources October 60 calls closed lower at
$6.80 an option. My current return on my
invested capital is 10%. I've been in that trade
for 42 days. My Pacificare Health Systems November
75 calls closed higher at $3.50 an option. My
current return on my invested capital is 21% after
being in the trade for 42 days. My Quicksilver
September 40 Puts closed higher at $0.50 an
option. I'm in the red with a return on my
invested capital of -69% after being in the trade
for 16 days. And my Tenaris October 105 Calls
closed lower at $14.30 an option. I'm in the
black with a return on my invested capital of 81%
after 7 days in the trade.

This is my plan for tomorrow. I'll be setting my
stop loss alerts for EOG resources at 5% return on
invested capital and for Pacificare Health
Systems, I'll set it 10% return on invested
capital. With respect to Tenaris I'm back to a
set stop loss strategy at 65% return on invested
capital. I'm also watching the price with respect
to the 7 day moving average. Tomorrow will be
more of a watch and see day as we see how the news
that has been streaming over the weekend effects
investors on their day back.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Oil Prices Hiking Up Energy Stocks!

2005-09-01T23:34:00.000-06:00

Market closed fairly flat, except for energy
stocks Fed’s might pause it’s rate hikes.
Take a look at volume charts if you don’t
already. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Thursday, September 1st with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching
the market tomorrow.

Today the market closed fairly flat. High energy
prices, even before Hurricane Katrina, have been
taking the wind out of a lot of sails; today, most
notably the retail sector. Energy stocks, just
due to the crazy high price of oil, gained. But
offset that with the retail sector losses and the
market moved pretty much nowhere. So, if you're
short in retail you were happy today. If you were
long in energy, like me - for the most part at
least - you were happy. We need to be on our toes
because this situation, will come to equilibrium
quite fast and we need to have our exit strategies
in place or all these paper gains will vanish.
The market today seemed more interested in the
speculation that the Fed will pause its rate
hikes. In fact the market believes this story -
true or not. The short bond's yield dropped to
below that of the Fed overnight borrowing rate.
The long bond was just about flat. This is an
interesting predicament that we need to watch
team.

Team, one chart I like to look at is one I call my
volume template. What I have is four ways to look
at the inflow and outflow of volume on a single
chart; the On Balance Volume, the Accumulation /
Distribution of Volume, the RSI, and a Volume
Chart with a 100 day average annotated in.
Generally, what we want to see is all four of
these charts to be in alignment with each other
and with price movement. Today, on a chart for
EXP I saw the following... Price was up today.
On Balance Volume was up. But Accumulation
Distribution dog legged down. RSI went flat on us
and volume dipped after yesterday's spike. The
lack of alignment is a red flag team. A big fat
red flag

The point to this analysis team is that you need
to be leery on extremely high volume breakouts.
It is unusual that they continue. It is more
usual that they collapse on themselves. So if you
see that happen and you aren't in the trade
already, stay away. If you get in long after the
break out you will be sorry. On the same token,
you can't just assume you can go short after a
breakout either. It's good to just bypass these
altogether for one's that fit our templates
better. Unless you're comfortable with loosing
more than gaining. But that really isn't a way to
run a business now is it?

My EOG resources October 60 Calls closed higher at
$7.80 an option. I'm out of the hole with a
return on my invested capital of 26%. I've been
in that trade for 41 days. My Pacificare Health
Systems November 75 Calls closed higher at $3.30
an option. I'm out of the hole with a return on
my invested capital of 14% after being in the
trade for 41 days. My Quicksilver September 40
Puts closed way down even more at 20 cents an
option. I'm in the red with a return on my
invested capital of -88% after being in the trade
for 15 days. And my Tenaris October 105 Calls
closed up at a wild $15.70 an option. I'm in the
black with a return on my invested capital of 99%
after 6 days in the trade. Yehaw!

This is my plan for tomorrow. I'm ratcheting up my
stop loss alerts to trigger off the bid price
should either EOG Resources or Pacificare Health
Systems go below 5% return on my invested capital.
With respect to Tenaris I'm beginning my trailing
stop loss strategy at this point with a 15%
difference between bid price and where I start.
Team, I'm looking to close out of my portfolio.
There is too much speculation in the market right
now. I'm uncomfortable and would like to take my
massive profits and run. For the rest of the day,
it'll be fun to watch the markets reaction to the
early morning employment data.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading
and money making. Trading Trainer is here
helping you create your dream lifestyle.

Best regards always,
A.J.

Click on the below play button to hear
the blog as an audio from A.J. himself!

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stock
charts on video each day, listen to his audio
newsletter where he leads you by the hand
through the end-to-end process of successful
options traders and get tips and tested strategies
proven to boost your return on your invested
capital by massive amounts in his membership
site at TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Rally Led By Builders And Energy Companies!

2005-08-31T23:44:00.000-06:00

Member surprised by rise in market,
although typical after disasters. More
companies needed to do cleanup, problem
solving. Government taking charge as
disaster strikes Gulf. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Wednesday, August 31st with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching
the market tomorrow.

It really is amazing to me. I was talking with a
TradingTrainer.com member today and he was
initially surprised at the market rally. He said
something like, "You would think with all the
devastation for Hurricane Katrina that the market
would decline." Traditionally, that is not the
case. Look back to September 11th, 2001. After
the initial decline, some of the best gains were
made in the weeks that followed. The war on Iraq
is another example. Wars and natural disasters
create work. They are problems that need to be
solved. In come companies to solve those
problems.

Today's rally was led by devastated home builders
and material supply stocks as well as energy
stocks that are benefiting from the high commodity
prices of oil and its derivatives. Chock that one
up to Hurricane Katrina as well. Not only did it
create a lot of work for builders, it knocked out
oil rigs and refineries in the Gulf of Mexico
which hampers the supply of a particular commodity
that is currently feeling the effects of record
demand. What you have to remember here is that
typically it is the government that pays the bill
for wars and natural disasters. That's versus
honest to goodness world demand for a product or
service. You have to ask yourself, the real
estate market in the U.S. is undergoing a
correction, so how can builders do so well today?
That's because the government is now the customer.
They are in charge of putting things back together
when things fall apart. What happens in the long
term then is that we have to fund the government
in the form of increased taxes. Or, the
government can go into debt. Either alternative
acts to slow the markets. So, these short term
positive spikes like the one we saw today, caused
by a natural disaster, but it just as well could
have been caused by a war or conflict, will have a
negative impact on the market in the long term.
Just know and understand that team.

Another aspect of today's rally was that the
Chicago PMI came in below 50 which signals a
decline in activity. That contradicts the growth
we've been seeing for over two years.. The blame
goes toward high energy prices. But the effect is
that investors don't feel inflation pressures as
much when declines are being reported. The
sentiment is that the Fed will hold off from
further rate hikes till news gets better. That
speculation makes the market rally.

My portfolio of mostly options on energy stocks
rallied for the most part of the day with a slight
bump in the afternoon. The bump came when
President Bush announced that he authorized
supplementing oil supplies with those from the
U.S. strategic reserve while supply from the Gulf
has been temporarily halted. Even with that bump,
I sold my Encana Corp October 42.50 Calls for a
"return on my invested capital" of 155%. Not bad.
I think I'll take 10% of the proceeds and treat
myself to two weeks this winter in French
Polynesia.

Team, you have to NOT be afraid to follow the
charts. You know how to protect your investments
once you are into a trade. You need to build
confidence in the charts. Even if you use the
TradingTrainer.com buffered template, the most
conservative, you would have still gained today.
Don't suffer from analysis paralysis which is
really a cover up for your fears. Take action.
At least paper trade. Don't let me be the one
getting rich over here alone.

Like I said, earlier, I sold my Encana October
42.50 calls at $7.40 an option when my trailing
stop was triggered after the afternoon pull back.
I closed that position with a return on my
invested capital of 155% after being in the trade
for 40 days. My EOG resources October 60 calls
closed higher at $5.60 an option. I'm just about
out of that hole with a return on my invested
capital of -10%. I've been in that trade for 40
days. My Pacificare Health Systems November 75
calls closed higher at $2.70 an option. I'm in
the red with a return on my investment of -7%
after being in the trade for 40 days. My
quicksilver September 40 Puts closed way down at
25 cents an option. I'm in the red with a return
on my invested capital of -84% after being in the
trade for 14 days. And my Tenaris October 105
Calls closed up at $11.80 an option. I'm in the
black with a return on my invested capital of 49%
after 5 days in the trade.

This is my plan for tomorrow. I'm going to start
the day by looking at Genentech and Valero for
possible morning purchases. I'll also evaluate
the remaining securities in my portfolio for
possible exits. Tomorrow could be another
volatile day. There's a lot of news hitting
investors tomorrow. Be on your toes. If it's too
much for you; do some paper trading. Take the
edge off. But, the theme of the day is DO
something. Don't just do nothing.

Till tomorrow, happy market watching, trading and
money making. Trading Trainer is here helping you
create your dream lifestyle.

Best regards always,
A.J.

About the Author
A.J. Brown is a full time options trader, author,
speaker and consultant. Watch him review stocks
charts on video each week, listen to his audio
newsletter where he leads you by the hand through
the end-to-end process of successful option
traders and get tips and tested strategies proven
to boost your return on your invested capital by
massive amounts in his membership site at
TradingTrainer.com today.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Watch For Upcoming Katrina Damage Report!

2005-08-30T23:30:00.000-06:00

Full distribution day for S&P and NASDAG.
Market may be heading towards bull pattern.
More volatility coming as Katrina rips
through the Gulf. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Tuesday, August 30th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching
the market tomorrow.

Today we had a full on distribution day in both
the S&P and the NASDAQ. For the NASDAQ, that is
the fifth distribution day in four weeks. The
Dow is once again below the level of support of
that ascending channel. But, all three indexes
did close today above their respective horizontal
levels of support. And, for the week so far, the
indexes have made gains in price. I watch closely
the Chaikin Oscillator and MACD indicators on our
indexes. The NASDAQ and S&P's Chaikin Oscillator
indicators are both close to crossing above their
zero's. And, the MACD indicators look to be
rebounding off their bottoms. Both of these, when
confirmed would be bullish moves. But, right now,
it is too soon to act on these patterns. Let's
not read into the charts that which is not there.
In the meantime, with the price of oil and its
derivatives reaching new highs, oil stocks, and
their respective options, are shooting through the
roof. If you've been using the TradingTrainer.com
watch lists and filters, you undoubtedly have
options on oil stocks in your portfolio. With
yesterday and today combined, you are undoubtedly
ecstatic. Now... have your exits thought out well.
Do not let greed get the best of you.

My Encana October 42.50 calls closed higher at $5.50
an option. I'm in the black with a return on my
investment of 90% after being in the trade for 39 days.
My EOG resources October 60 calls closed higher at
$5.10 an option. I'm digging myself out of the red
with a return on my investment of -18% after being
in the trade for 39 days. My Pacificare Health
Systems November 75 calls closed lower at $2.25 an
option. I'm in the red with a return on my investment
of -22% after being in the trade for 39 days. My
Quicksilver September 40 Puts closed down at 90 cents
an option. I'm in the red with a return on my
investment of -44% after being in the trade for 13 days.
And, my Tenaris October 105 Calls closed up at $9.70 an
option. I'm in the black with a return on my investment
of 23% after 4 days in the trade.

This is my plan for tomorrow. My Encana Corp options
are nearing my profit targets which means I transition
into a trailing stop exit strategy. That will allow me
to lock in profit while taking advantage of any additional
positive price movement. My trailing stop loss strategy
for tomorrow will be set at 15% off of the bid price. For
EOG Resources and Tenaris Corp, I'll be ratcheting up my
standard stop loss strategy, setting fixed values should
the bid price go lower. I'll be watching my QuickSilver
Puts and making, possibly, a snap judgment to cut my losses
(or not). Same with Pacificare Health Systems. Tomorrow,
the Energy department is reporting on oil reserves from
last week. The results they will release will be from
before Hurricane Katrina stormed through the Gulf disabling
rigs and refineries. It really won't be till Wednesday of
next week that we'll get the official damage assessment
from the Energy department. So, we literally will have
six days of volatile / unguided trading that is going
to commence between now and then. That is for sure a
recipe for me to sit out. At this time, my aim is to
sell off my portfolio. I will only open new positions
if the opportunity is too good to be true.

Till tomorrow, happy market watching, trading and
money making. Trading Trainer is here helping you
create your dream lifestyle.

Best regards always,
A.J.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Better Movement But On Low Volume!

2005-08-29T23:03:00.000-06:00

Better price movement today. Below
average volume could be effected by
hurricane. Oil and Natural Gas up again.
Keep an eye on the institutional traders.
Get the latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Monday, August 29th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching
the market tomorrow.

The Dow rebounded off horizontal support at
$10,400 and bounced back up into its ascending
price channel. I'm watching this closely. The
NASDAQ closed up at its 50 day average. All in
all today had some pretty nice price movement.
What I notice right off is that institutional
traders are just not buying it. Otherwise, I
would see some volume. Volume was below average
all across the boards. The NYSE had slightly
heavier volume than last Friday while the NASDAQ
came in lighter. What is interesting is the
whole dynamic around the hurricane, and its effects
on the price of oil and natural gas as well as its
effects on the market. As the hurricane was moving
through the Gulf, the price of oil shot way high,
above $70.00 a barrel. Natural gas shot way high,
too. Then, as the storm passed, the price of oil
retreated but still closed higher for the day.
Natural gas, too. But, the market rallied in price.
As if to say, we already factored in the ramifications
of the hurricane, so there! It is very unpredictable.
In times like these we want to fall back to our
elementary trend following rules which state that we
want to do what the institutional traders are doing.
Today they sat on the sidelines and watched. So did I.

I'm going to start using the Bid price in my example
portfolio calculations. It is more telling. With
the bid price, we can know exactly what my ROI would
be should I need to sell immediately. Let's take a
look. My Encana October 42.50 calls closed higher at
$4.30 an option. I'm in the black with a return on
my investment of 48% after being in the trade for 38
days. My EOG resources October 60 calls closed higher
at $4.10 an option. I'm in the red, still, with a
return on my investment of -34% after being in the
trade for 38 days. My Pacificare Health Systems November
75 calls closed lower at $2.40 an option. I'm now in
the red with a return on my investment of -17% after
being in the trade for 38 days. My Quicksilver September
40 Puts closed down at $1.85 an option. That puts me
in the black with a return on my investment of 16%
after being in the trade for 12 days. And, finally,
my Tenaris October 105 Calls closed up at $8.80 an
option. I'm in the black with a return on my investment
of 11% after 3 days in the trade.

This is my plan for tomorrow. I will be quick to unload
from my portfolio should the broad market choose a
direction. After amateur hour I'm setting limit sell
orders on all the options in my portfolio, good for
the day, setup to catch profit. I'll also setup my
alert on Genentech - ticker DNA - should it cross above
it's top Bollinger Band. I have my call all picked out,
so should that alert pop, I take a look and if I like
what it is doing, I'll easily open a position. For the
rest of the day, though, team. I'm just interested in
where the broad market is going and what our friends
the institutional traders are thinking. It'll, therefore,
be a low activity day for me.

Till tomorrow, happy market watching, trading and
money making. Trading Trainer is here helping you
create your dream lifestyle.

Best regards always,
A.J.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

More Loss Today From Katrina!

2005-08-28T23:43:00.000-06:00

Market down due to economics, debt, and
political positions. Katrina wrecking more
havoc on markets. May be a good day to
sell tomorrow. Get the latest at
TradingTrainer.com.

Hey trading team,

This is A.J. on Sunday, August 28th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from last Friday as well as prepare you for watching
the market tomorrow.

We had a mixed day of trading this past Friday.
Greenspan's comments warning about painful
economic corrections having to do with the
housing markets, the skyrocketing debt and the
protectionism toward China that some politicians
are embracing, set the mood for a down day.
Throw into that a little smattering of a
Hurricane Katrina threatening all the oil
refineries in the Gulf and you've got a recipe
for yet another broad market distribution day.
All the indexes are below their 50 day averages.
The Dow is below its 200 day average as well. The
Dow on Friday also broke through an ascending line
of support and closed at a level of horizontal
support down at $10,400. Our bias, being set at
neutral, is still fitting but with an added
caveat: we need to refrain from opening long
positions based on trend following templates.
Until the broad market confirms a bias, our trend
following templates have been rendered somewhat
ineffective.

I was one of those that took profits on Friday by
closing my Premcor position. I sold my Premcor
September 75 Calls for $5.60 an option only
getting an 8% return on my investment after being
in the trade for 22 days. I also opened a new
position. I bought the Tenaris October 105
Calls. I bought those options for $7.90 each.
My Encana October 42.50 calls closed lower at
$3.90 an option. I'm in the black with a return
on my investment of 34% after being in the trade
for 35 days. My EOG Resources October 60 Calls
closed lower at $3.60 an option. I'm in the red
with a return on my investment of -42% after being
in the trade for 35 days. My Pacificare Health
Systems November 75 calls closed flat again at
$3.40 an option. I'm in the black with a return
on my investment of 17% after being in the trade
for 35 days. And, finally, my Quicksilver
September 40 Puts closed up at $2.05. I'm in the
black with a return on my investment of 28% after
being in the trade for 9 days.

This is my plan for tomorrow. I'm going to
seriously look at unloading from my portfolio.
After amateur hour, I'm setting limit sell orders
on options in my portfolio, good for the day,
setup to catch profit. I'll watch Pacificare
Health Systems, Cerner Corp and Genetech with
respect to their Bollinger Bands. I again will
place limit buy orders for Calls to trigger
should price break above the Bollinger Bands and
a limit buy orders for Puts to trigger should
price break below the Bollinger Bands. Those
limit buy orders will only be good for the day.
Besides that team, I'm just interested in where
the broad market is going. So, for the most part
tomorrow, I'll be watching from the sidelines.
Okay, team. I'm done.

Till tomorrow, happy market watching, trading and
money making. Trading Trainer is here helping you
create your dream lifestyle.

Best regards always,
A.J.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

Low Volume Caused By Katrina

2005-08-25T23:36:00.000-06:00

Very slow day of trading and low volume.
How hurricane Katrina is effecting the
market. Job market not looking so hot
with more demand than supply. Get the
latest at TradingTrainer.com.

Hey trading team,

This is A.J. on Thursday, August 25th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching
the market tomorrow.

Today, we had a day of very light trading on both
the NYSE and NASDAQ exchanges. Even though the
broad market indexes logged gains for the day.
with volumes coming in so low, the confidence
that those little gains will stick is really
little to none. Oil pulled back today only to
close even higher - another record. Investors
are really worried that Hurricane Katrina will
slow supply coming out of the gulf. Jobless
claims dropped last week. This is a lagging
indicator. At the same time, help wanted ads in
July dropped as well. This is a leading
indicator. The supply of jobs is declining.
This is forecasting that demand for jobs my soon
overshadow supply. We'll need to watch that.
From a technicals perspective, looking at a year
long chart of the DOW you can see that prices are
trading in a long term ascending channel.
Yesterday, prices closed at the level of support
of that channel. Today they bounced off. Team,
we need to watch that level of support and if
price breaches it on heavy volume.

Today, with the oil sector moving, my portfolio
moved, too. My Encana October 42.50 calls closed
higher at 4.10 an option putting me in the black
by 41% for a trade that has lasted 34 days so
far. My EOG resources October 60 calls closed
lower at $4.20 an option still leaving me in the
red, down now 32%, also for a trade that has
lasted 34 days so far. My Pacificare Health
Systems November 75 calls closed flat again at
$3.40 an option keeping me in the black by 17%
for a trade, too, that I have been in for 34 days
so far. My Premcor September 75 calls closed
lower at $5.90 an option, still in the black by
13% for a trade I've been in for 21 days so far.
And my Quicksilver September 40 Puts closed flat
at $1.70 an option keeping me in the black by 6%
for a trade I've been in only 8 days so far.

This is my plan for tomorrow. After amateur hour
I'm evaluating and setting limit sell orders
that'll be good for the day on stocks in my
portfolio. The orders will be set so should they
fill, I'll be setup to catch profit. I'll again
employ my strategy around Pacificare Health
Systems, Cerner Corp and Genetech to catch any
break outs from them being in consolidation
patterns for so long. I can do that by placing
limit buy orders for Calls to trigger should
price break above the Bollinger Bands and a limit
buy orders for Puts to trigger should price break
below the Bollinger Bands. Those limit buy
orders will only be good for the day. If they
fill, they fill. If not, no worries. I'll also
look for follow through on Tenaris staying above
resistance. If it sustains, I'll consider a long
position. Other than trying to catch
consolidation patterns and my focus on Tenaris,
I'm staying put on the sidelines during this
volatile time when the lack of volume gives me an
eerie feeling.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and
money making. Trading
Trainer is here helping you create your dream
lifestyle.

Best regards always,
A.J.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.

New Housing Sales Increase!

2005-08-24T23:22:00.000-06:00

Experiencing heavy traffic on the DOW. Oil
prices rise today as stockpiles diminish.
Watch for something to break stalemate
soon. Oil prices boost portfolios. Get the
latest at TradingTrainer.com.

This is A.J. on Wednesday, August 24th with your
Trading Trainer web log. We are your home of
market insights for the serious option trader.
This web log will cover the events in the market
from today as well as prepare you for watching
the market tomorrow.

Today, we had a full-on distribution day. Price
dropped, especially on the Dow. We had heavier
volume on all the major indexes with it
approaching the level of the 100 day average.
Today the commerce department reported that new
housing sales increased. But read the fine
print; the prices are dropping and inventories
are up to a 4-month level. Also, durable goods
orders declined more than expected. And finally,
the capper to it all was oil and all of its
derivatives hitting record closes today after the
energy department reported stock piles dropped
unexpectedly. For the NASDAQ this is the 4th
distribution day in just 20 trading days.
Everyone wants to know if this is the end of the
rally. We can tell with all the consolidation
patterns forming across all sectors that people
are waiting. They’re waiting for a spark of a
hint to break the stalemate in one direction or
another. Tomorrow, we'll be looking for follow
through on today's actions.

Today, with the oil sector running hot, my
portfolio gained somewhat. My Encana October
42.50 calls closed higher at 3.50 an option
putting me in the black by 21% having been in the
trade only 33 days. My EOG resources October 60
calls closed higher at $4.50 an option still
leaving me in the red, down 27% having been in
the trade only 33 days. My Pacificare Health
Systems November 75 calls closed flat at $3.40 an
option keeping me in the black by 17% having been
in the trade only 33 days. My Premcor September
75 calls closed higher at $6.00 an option putting
me in the black by 15% having been in the trade
only 20 days. And finally, my Quicksilver
September 40 Puts closed flat at $1.70 an option
keeping me in the black by 6% having been in the
trade only 7 days.

This is my plan for tomorrow. After amateur
hour, I'm setting limit sell orders on stocks in
my portfolio, good for the day, setup to catch
profit. I'm still running my strategy around
Pacificare Health Systems by placing a limit buy
order for Calls to trigger should price break
above the Bollinger Band and a limit buy order
for Puts to trigger should price break below the
Bollinger Band. Those limit buy orders are only
good for the day. For that matter, I am
employing that same strategy on Cerner Corp and
Genentech. Other than trying to catch breakouts
after consolidation patterns, I'm staying put on
the sidelines during this volatile time.

Okay, team. I'm done.

Till tomorrow, happy market watching, trading and
money making. Trading Trainer is here helping you
create your dream lifestyle.

Best regards always
A.J.

* You may reprint or distribute this article as
long as you leave the content, the links and the
resource box at the end intact.