Today I closed a long dated, deep in the money call option on EBAY for a 29%+ gain. The rules call for an exit 30 days following an OS Buy signal or a touch of the upper volatility band, whicher comes first. Ebay had a Very Bullish Power Gauge rating at the time I put on the trade. We're 7 for 7 so far, with 3 open trades remaining.
Signals on stocks that are liquid enough for long-dated in-the-money call options have been few and far between the last couple of weeks. So far, looking good. Need about 95 more trades to have an expectancy that will inspire confidence. I'll keep you up to date.
Here are the forward test results so far for the Oversold Buy strategy. As long as the market stays bullish, we will keep trading this way and report on the results. I'm trading In The Money Long Dated Options and AA is trading long dated Out Of The Money options. We're entering on an OS Buy Signal with a few other rules in pace (see earlier posts and videos) and exiting on a touch of the Outer Volatility Band or about one month from entry, whichever comes sooner. This is the shortest term of the Chaikin strategies/signals. We ONLY use risk defined option strategies so that drawdowns and losses never exceed 1% of our account values. No stop losses on the trades.
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