Bollinger Bands offer a rich variety of signals in many ways. The bands track resistance as prices trend higher, and track support as prices move lower. The Bollinger squeeze anticipates coming reversal or breakout from consolidation. The combination of the bands and the t-line add great value in identifying channels and when they are likely… [READ MORE]

Selling short options as part of a swing trading strategy in many respects is a higher-risk strategy than the opposite focus on long options only, although the degree of risk might not be as severe as you think at first glance. This is true for seven reasons: You can cover a short call with ownership… [READ MORE]

At times, the chart pattern is so exceptional, and price moves so much, that you have to expect a retracement. No matter how significant the news, surprises inevitably cause an over-reaction in price, followed by an adjustment. Case in point: Amazon.com moved on Friday, October 27 by 128 points to the upside. An abundance of… [READ MORE]

Positioning of strike and expiration and proximity are crucial to the success of a covered call strategy. Selection of the elements requires awareness of (1) level of volatility, (2) degree of time value and (3) proximity between current value of the underlying and strike of the short call. The three elements that define the well-selected… [READ MORE]