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Simply Options > Bootcamp lesson 2 > Flashcards

Bootcamp lesson 2 Flashcards

1
Q

What does the phrase ‘snap graphs are telling us to spike’ mean?

A

It means that the snap graphs are indicating an upward movement in price.

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2
Q

In the long term, what does the inhibition zone suggest for the price action?

A

The inhibition zone suggests that the price action may become bullish in the future.

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3
Q

What is the significance of the monthly trigger being above 116.88?

A

The monthly trigger being above 116.88 indicates a potential bullish signal.

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4
Q

Does the positioning of the crosshairs relative to the gold line matter for expected price action?

A

Yes, the positioning of the crosshairs relative to the gold line can indicate more volatile moves.

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5
Q

Based on VOEX’s trend being in the inhibition zone, do people seem to agree or disagree that Baba can move up to its monthly trigger?

A

It seems that people agree that Baba can move up to its monthly trigger based on VOEX’s trend being in the inhibition zone.

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6
Q

How would you structure a long-term trade for Baba?

A

I would wait until the VOEXs one day looks bullish or until the price gets back above the hourly trigger, and then take a position to the monthly trigger.

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7
Q

What is the air pocket in the context of the trade?

A

The air pocket refers to a significant potential move in the price.

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8
Q

What can the crossing of the daily trigger above the weekly trigger lead to in terms of price movement?

A

The crossing of the daily trigger above the weekly trigger can potentially lead to a move up to the monthly trigger in price.

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9
Q

What does a delta of 0.75 mean in terms of price movement?

A

A delta of 0.75 means that the price moves down $0.10.

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10
Q

What is the suggested approach for placing a stop loss?

A

The suggested approach is to set the stop loss right below the trigger.

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11
Q

What conditions need to be met for a bearish confirmation?

A

A bearish confirmation requires the daily trigger to be lost and the hourly trigger to come back through.

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12
Q

What are the options for getting long again?

A

The options for getting long again are waiting for the price to be back above the hourly trigger or waiting for a downside move to the weekly trigger.

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13
Q

What are SNAP graphs and how can they be used?

A

SNAP graphs can be used to determine if the market is turning more bullish or bearish.

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14
Q

What can be done to gain a deeper understanding of SNAP graphs?

A

Reviewing the cheat sheet or the daily video section can help in gaining a deeper understanding of SNAP graphs.

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15
Q

What is the significance of debit spreads and credit spreads in trading?

A

Debit spreads and credit spreads are an important part of trading that many people don’t utilize or understand fully.

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16
Q

What are the potential outcomes when PayPal breaks above the weekly trigger?

A

The potential outcomes could be PayPal chopping until the trigger crisis, exploding higher, or breaking above and coming back down below.

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17
Q

What does it mean when the stock is in the inhibition zone?

A

When the stock is in the inhibition zone, it means that the stock will continue to move higher until proven otherwise.

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18
Q

What needs to happen for the stock to move into the propagation zone?

A

For the stock to move into the propagation zone, either bullets must crack into the propagation zone or VOEX’s trend must move back into stability.

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19
Q

What could happen if bullets move into the stability zone?

A

If bullets move into the stability zone, it could indicate a short-term downside.

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20
Q

What is the significance of folks trend moving into the animation zone?

A

When folks trend moves into the animation zone, it signifies that VOEX has stayed in the inhibition zone long enough to have a presence there.

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21
Q

How can one trade on their own hedging for downside?

A

One can trade on their own hedging for downside by selling credit spreads, selling debit spreads, buying puts, or buying once price points below the hourly trigger.

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22
Q

What is the behavior seen in Baba when it moves from the inhibition zone to the stability zone?

A

When Baba moves from the inhibition zone to the stability zone, it is a bullish move that follows folks daily with the trend before a rally.

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23
Q

What should be considered when the VOEX trend moves into the inhibition zone?

A

When the VOEX trend moves into the inhibition zone, it should be known that price action is being worked against, even if it’s bullish.

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24
Q

What happens to the price when the VOEX trend moves into the animation zone?

A

When the VOEX trend moves into the animation zone, the price continues to slowly or not so slowly climb to the upside.

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25
Q

How can you make a profit before the trigger signal gets confirmation using debit spreads?

A

You can make a profit before the trigger signal gets confirmation using debit spreads by selling $85 calls and buying $80 calls.

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26
Q

What is the advantage of selling zero day contracts?

A

The advantage of selling zero day contracts is that theta works on your side.

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27
Q

What is the risk of selling puts on SPI?

A

The risk of selling puts on SPI is being assigned 100 shares at $50 each if the put goes in the money.

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28
Q

What happens if the price goes down to 448 in a credit spread trade?

A

If the price goes down to 448 in a credit spread trade, the difference between 450 and 448 is lost, but as long as the price does not come back below 450, there will be some profit or loss depending on theta.

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29
Q

How can you profit in a credit spread trade if both the 450 call and the 448 put expire worthless?

A

You can profit in a credit spread trade if both the 450 call and the 448 put expire worthless by selling the 450 call for $100 and buying the 448 put for $60, which results in a $40 difference.

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30
Q

What is the maximum risk in a credit spread trade if you sell ten of them?

A

The maximum risk in a credit spread trade if you sell ten of them is about $100 or $160 for each put spread credit spread.

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31
Q

When can you buy puts instead of buying calls?

A

You can buy puts instead of buying calls when there is extreme bullish data from Spire VOEXs or when there are bearish outlooks based on VOEX’s divergence, VOEX spikes, or movement of VOEX’s back stability from the inhibition zone.

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32
Q

What do the snap graphs help interpret?

A

The snap graphs help interpret future price action.

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33
Q

How many years of previous data do the snap graphs calculate?

A

The snap graphs calculate three years of previous data.

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34
Q

What was the accuracy of the 20-day snap graphs over the past five years?

A

The 20-day snap graphs were correct 78% of the time.

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35
Q

Why are the closer snap graphs more reactive?

A

The closer snap graphs are more reactive because they have a lesser chance of being correct.

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36
Q

What does a spike in Baba’s snap graphs indicate?

A

A spike in Baba’s snap graphs indicates short-term downside.

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37
Q

What does the one-day snap graph for Baba suggest?

A

The one-day snap graph for Baba suggests bearish price action.

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38
Q

What does the 20-day snap graph for Baba suggest?

A

The 20-day snap graph for Baba suggests bullish price action.

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39
Q

Why would the closer data snap graphs be bearish and the 20-day snap graphs be bullish?

A

The reason could be explained by what the snap graphs are seeing in both cases.

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40
Q

What is the difference between a put credit spread and a put debit spread?

A

A put credit spread involves selling put options with a higher strike price and buying put options with a lower strike price, while a put debit spread involves buying put options with a higher strike price and selling put options with a lower strike price.

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41
Q

What is the maximum loss in a put credit spread?

A

The maximum loss in a put credit spread is the difference between the strike prices minus the net credit received.

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42
Q

What is the maximum loss in a put debit spread?

A

The maximum loss in a put debit spread is the difference between the strike prices plus the net debit paid.

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43
Q

What is the difference between a call credit spread and a call debit spread?

A

A call credit spread involves selling call options with a higher strike price and buying call options with a lower strike price, while a call debit spread involves buying call options with a higher strike price and selling call options with a lower strike price.

44
Q

What is the purpose of using spreads in options trading?

A

The purpose of using spreads in options trading is to minimize risk while still being able to capture possible upside or downside.

45
Q

What is the difference between a put spread and a call spread?

A

A put spread involves using put options, while a call spread involves using call options.

46
Q

What is the relationship between price movement and the value of options contracts in a put spread?

A

As the price moves down, the put option with a lower strike price gains value, offsetting the potential loss in the put option with a higher strike price.

47
Q

What needs to be taken into account when trading spreads?

A

When trading spreads, you need to have a margin account and be aware of the margin requirements.

48
Q

What is the strategy of using debit spreads to minimize downside risk?

A

Debit spreads are a great way to minimize downside risk before trigger signal gives confirmation while still being able to capture upside price action.

49
Q

What is the purpose of buying the $80 call and selling the $85 call?

A

The purpose is to capture upside price action while minimizing downside risk.

50
Q

How much profit per call is made when the price goes up and the $85 call is bought back?

A

$30 per call.

51
Q

What is the scenario when price breaks above the hourly trigger?

A

If price breaks above the hourly trigger, it can potentially lead to a large move higher.

52
Q

What is the scenario when the price goes sideways and both contracts lose in theta?

A

When the price goes sideways, both contracts lose in theta.

53
Q

What happens when the hourly trigger crosses above and the $85 calls are bought back?

A

When the hourly trigger crosses above, the $85 calls can be bought back for a cheaper price.

54
Q

What action can be taken if the price rejects the weekly trigger and comes back down to the hourly trigger?

A

If the price rejects the weekly trigger and comes back down to the hourly trigger, the sold $85 calls can be bought back for cheaper, and the bought $80 calls can be added back.

55
Q

How much loss is incurred when the price comes back to the hourly trigger?

A

When the price comes back to the hourly trigger, the loss is reduced from $40 to $10 for the $80 calls.

56
Q

When did the VOEXs trend start moving into the inhibition zone?

A

On January 20th.

57
Q

What was the percentage move to the upside during the mentioned period?

A

91%.

58
Q

How many pullback days were there during the VOEXs trend in the inhibition zone?

A

There were five pullback days.

59
Q

What triggers crossed above on January 20th for the stock price?

A

The hourly trigger crossed above, followed by the daily trigger.

60
Q

How can you structure a trade using VOEX once it moves into the inhibition zone?

A

Once VOEX’s trend moves into the inhibition zone, you can structure a trade assuming bullish until proven otherwise.

61
Q

What zone does VOEX need to stay in to maintain the bullish assumption?

A

VOEX needs to stay in the inhibition zone to maintain the bullish assumption.

62
Q

Which zone would indicate a bearish assumption for VOEX?

A

If VOEX’s trend moves back down into the stability zone or if VOEX itself moves back down into the propagation zone, it would indicate a bearish assumption.

63
Q

What is the strategy mentioned for making money from the data without having to trade every single day?

A

Learn more about credit spreads and debit spreads.

64
Q

What is the only way to lose the full amount in a specific scenario?

A

If the price moves above 58 or 57 by expiration.

65
Q

What does the speaker do as soon as the market opens?

A

They sell the zero day contracts.

66
Q

What is the main factor the speaker considers while selling put spreads?

A

As long as the price is above the hourly trigger and the hourly chart.

67
Q

When does the speaker usually scalp the market and have fun making money?

A

On Fridays.

68
Q

What is the advantage of selling credit spreads over debit spreads?

A

In credit spreads, the max risk is limited to the difference between the call that you sell and the call that you buy.

69
Q

How does the speaker make money by selling puts spreads?

A

By keeping the premium when they expire worthless.

70
Q

What trigger crossed above the weekly trigger for Palantir?

A

The hourly and the daily trigger crossed above the weekly trigger for Palantir.

71
Q

What was the percentage move to the upside for Palantir?

A

Palantir moved to the upside 81%.

72
Q

What is the monthly trigger for Baba?

A

The monthly trigger for Baba is the target for a 30% move up.

73
Q

What are the possible stop loss triggers mentioned that can be used for risk management?

A

The possible stop loss triggers mentioned are the daily trigger, the weekly trigger, and the hourly trigger.

74
Q

What is the risk to reward ratio mentioned for a trade?

A

The risk to reward ratio mentioned is 3 to 28.

75
Q

What indicates a possible buy opportunity for Baba?

A

A massive amount of sold puts or a flip in opinion by the one day, five day, and ten day snap graphs indicate a possible buy opportunity for Baba.

76
Q

How does the speaker calculate the stop loss level using a trigger?

A

The speaker sets an alert under the trigger and if the alert gets hit, they look at the chart and then exit the position.

77
Q

What is another method mentioned for setting a stop loss below a trigger?

A

Another method mentioned is to set the stop price a certain amount below the trigger, such as $0.10, to ensure being stopped out if the price moves back down below the trigger.

78
Q

What is the purpose of using debit spreads?

A

Debit spreads are used to mitigate the risk of price breaking above the weekly trigger and bringing it back down, or price doing nothing during a specific time period.

79
Q

When does the trigger for the debit spread strategy occur in the case of PayPal?

A

The trigger for the debit spread strategy occurs when PayPal crosses the weekly trigger at 72.

80
Q

What is the difference in profit between selling the $85 call and not selling it when price continues to move higher?

A

When price continues to move higher, selling the $85 call as part of the debit spread strategy results in lesser profit compared to not selling it, due to the spread.

81
Q

What is the benefit of selling the $85 call in the debit spread strategy?

A

Selling the $85 call allows for profit in case price breaks above the weekly trigger and then stagnates sideways until the hourly trigger crosses above.

82
Q

How can the hedge be closed in the debit spread strategy?

A

The hedge can be closed by buying back the call that was previously sold at a lower price when the hourly trigger crosses above.

83
Q

In the third scenario, when price breaks above the weekly trigger and then bounces back to the hourly trigger, what happens to the trade?

A

In this scenario, the trade continues moving higher and profit can be made.

84
Q

According to the course notes, what is the plan after the bootcamp ends?

A

The plan after the bootcamp ends is to pay deep debt stocks for limited data.

85
Q

How many stocks could we have access to after the bootcamp ends?

A

After the bootcamp ends, we could have access to eight meme stocks and an additional 1020 stocks.

86
Q

What is the suggested strategy for finding trades using VOEX?

A

The suggested strategy is to check VOEX at night, understand what it is telling you, and be able to enter a position based on your understanding.

87
Q

Is there a way to use VOEX for free?

A

No, there is no way to use VOEX for free as it is part of deep dive stocks.

88
Q

When did Palantir’s stock move into the inhibition zone?

A

Palantir’s stock moved into the inhibition zone on May 10th.

89
Q

What happened when the trend moved into the inhibition zone for VOEX?

A

While the trend was in the inhibition zone, there were not necessarily green days every single day, but there was a 92% move to the upside from when the trend moved into the inhibition zone until May 10th.

90
Q

What is the benefit of using VOEX graphs?

A

Using VOEX graphs allows you to determine whether a stock is bullish or not and eliminates the need to constantly monitor day-to-day or minute-to-minute actions.

91
Q

What can the snap graphs indicate about short term downside?

A

The snap graphs suggest that the spike will cause short term downside over the next one, five, and ten days.

92
Q

What is the meaning of crosshairs below the gold line on the snap graphs?

A

Crosshairs below the gold line indicate a bearish signal.

93
Q

According to the snap graphs, what does the 20-day snap grab suggest?

A

The 20-day snap grab suggests bullish price action.

94
Q

What does it mean for the trend to be deep in the inhibition zone?

A

When the trend is deep in the inhibition zone, it indicates that future upside is expected.

95
Q

What is the significance of a spike in the snap graphs?

A

A spike in the snap graphs indicates extreme resistance and usually results in short term downside.

96
Q

What does the shaded area on the ten-day forecast represent?

A

The shaded area on the ten-day forecast represents the 68% confidence interval of where the price will be.

97
Q

What is the main purpose of the snap graphs?

A

The snap graphs serve to interpret current market conditions and provide insights into future price trends.

98
Q

How can assumptions be made about VOEXs based on the 20-day snap wraps?

A

Assumptions can be made that VOEXs will remain bullish based on the 20-day snap wraps signaling bullish price action.

99
Q

When the trend moves back into the stability zone, what happens to the price?

A

The price experiences a severe downside from $95 down to $81.

100
Q

What is the significance of the spike in the price action?

A

The spike indicates extreme working against the price, making it dangerous.

101
Q

What follows once both the trend and low move back into stability?

A

The bulk of the downward price action occurs.

102
Q

When OKC’s trend moves into the inhibition zone, what happens to the price?

A

The price has some nice upside.

103
Q

What does it mean when the VOEX trend is deep inside the inhibition zone?

A

It takes a lot of movement to bring the trend back into stability.

104
Q

What happens when the bullish trend moves really high into the inhibition zone?

A

It would take a significant downward movement to bring the trend back to stability.

105
Q

What happens when the bullish trend escapes too far into inhibition?

A

It leads to extreme price movements and rallies.

106
Q

What does the behavior of the price suggest about its future direction?

A

The price is expected to move upward and become bullish.

Simply Options (22 decks)

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