Simple Long Put Strategy Boosts Returns to 558% on actual capital in just 8 days! We are excited to share a professional-style directional trade that can significantly enhance your trading returns while minimizing your effort and adjustments.
While we’re known for powerful non-directional trading strategies, we also work with many directional traders and hedge fund managers. In our PRO membership, we teach traders to understand market price action, enabling them to make informed trading decisions in both non-directional and directional trades.
Click here or in the video to watch this trade win!
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00:00 – Long Put Directional Trade 01:54 – Price Action 02:25 – Trade Parameters 02:55 – Trading Thesis 03:29 – Technical Analysis Lesson 03:51 – Market Profile 05:08 – Unhealthy Market Environment 05:52 – Entry Points 07:46 – Bearish signals 08:10 – Trade Entry 09:55 – $20,000 Gain 10:32 – Exit parameters 13:41 – Market bounce 17:57 – Trade Profits
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Today, we’ll discuss a straightforward trading structure: the long put. Our example will involve a maximum trade size of $5,000, with anticipated returns around $10,000—potentially reaching $20,000 or more. We’ll establish our exit and adjustment triggers based on either a technical failure or a $5,000 drawdown.
Understanding Our Trading Thesis
Before we dive into the technical aspects, let’s outline our trading thesis. This involves defining our entry points, setting responsible risk management practices, and determining our profit expectations for the trade.
Technical Analysis Breakdown
The market had been trending upward, forming a cup-and-handle pattern, followed by a breakout. However, as we observed the price action, we noticed signs of potential failure—specifically a lack of short-term price support and a bearish engulfing pattern.
The first potential entry point for a short trade appeared as the market broke below a significant support level, indicating a head-and-shoulders pattern.
Entering the Trade
Despite the clear signals, I chose to wait for optimal conditions. Eventually, on my entry date, I anticipated a breakdown and selected a put option with eight days until expiration. My expected move was down to around 5190, with potential profits calculated based on these targets.
Risk Management: A Critical Component
As the market moved, I continuously monitored my position. After a few days, I adjusted my put option to mitigate risk, ensuring that even in a worst-case scenario, my loss would remain manageable while leaving room for significant profits.
Progressing Through the Trade
As we approached the final days before expiration, the market exhibited fluctuations, allowing me to adjust my position strategically. Each adjustment reduced my risk while maintaining profit potential.
On the last day of trading, the market experienced a significant drop, allowing me to lock in a profit of $16,601 with maximum risk of only about $3,000.
Conclusion: The Power of Technical Analysis
Through this trade, we achieved an impressive return of approximately 558% on the capital involved in just eight days. This underscores the value of understanding market behavior and utilizing effective risk management strategies.
If you’re interested in learning how to identify and execute similar trade setups, I invite you to explore our Pro Membership. Additionally, check out The Winning Trade for insights into past and upcoming trades, as well as valuable resources for enhancing your trading performance.
Thank you for joining me today. I look forward to seeing you on our next winning trade! Remember to like and subscribe to our channel, and feel free to leave comments or questions below. I love hearing from you!
SEE OTHER PRO WINNING TRADE EPISODES!
Episode 133 – Trading With The PROS
Returns of this trade: This trade earned a profit of over $4,300 on just over $2,000 for a return of about 206% in only 13 days*! Click here to see the details!
Episode 131 – Trading With The PROS
Returns of this trade: This trade earned approximately $8,545 on only $3,600 of margin in only 17 days*! Click here to see the details!
Episode 109 – Trading With The PROS
Returns of these trades: Trade 1 earned about 12.5%, Trade 2 earned about 12.5%, and Trade 3 earned about 18.7%. All 3 trades had a planned capital of $15,000 each.*
*The result shown is from real-time, hypothetical trades such as those shown in the Options Trading for Income weekly webinar or Trading With The Pros biweekly webinars. Simulated trades are believed to be represented as accurately as possible, however, live results may have been different. The result is shared as an example for educational purposes ONLY
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