Options Charting

Discussion in 'Options' started by sumfuka, Aug 26, 2010.

  1. spindr0

    spindr0

    Before using sophisticated software, it might be useful for the masses to understand options :)
     
    #11     Aug 27, 2010
  2. livevol_ophir

    livevol_ophir ET Sponsor

    Nah, over rated :D
     
    #12     Aug 27, 2010
  3. if u want to chart options, you have to ask yourself the reason for it. I can't see the reason why you would chart it and trade it using traditional TA stuff on the options like support and resistance. there would be no such thing since they decay and they are after all derivatives. you can't make a buy decision saying "If the ATm front month call goes from $2 to $3 then back to $2 then i will buy since that would be support.

    You can however, chart the ATM straddle so you can see how it decays over time. Once in a while, edges develop when the slope of decay flattens out or rises (ie neg theta) in front of events. Now you got something....
     
    #13     Aug 27, 2010
  4. sumfuka

    sumfuka

    Today for example the TBT call options. I picked up some 35 calls yesterday. Today the 34 Calls rose 100%, the 35 calls rose 76.92%, and the 36 calls rose 133.33%.

    What gives? shouldn't my 35 rise 115% or something along the lines?

    I'm not complaining, as it is a very good investment for less than 24 hours, but there has to be a better method to pick strike prices that has more upside compared to the other ones.

    Thanks in advance... :)
     
    #14     Aug 27, 2010
  5. willem

    willem

    There is -- it's called Delta. Understanding how Delta works is far more important than having a chart.

    Good luck - hope you're simtrading to begin with.
     
    #15     Aug 27, 2010
  6. sumfuka

    sumfuka

    Thanks everyone for your generous help. :)
     
    #16     Aug 27, 2010
  7. jaadi

    jaadi

    Try avasaram.com they are free
     
    #17     Aug 31, 2010