The first one will be a compilation of all videos I have published in my two blogs. Only the quicktime files you may have already seen, but in a convenient DVD you can examine and review the associated text in old articles in my blog.
The second, which is 75% complete, includes an approach to finding stocks with potentially profitable Elliott patterns, and the follow up of a paper account opened at $10,000, as it becomes profitable. So far I have 14 video clips from an introduction to the Elliott wave, to the trading of long calls and puts.
I can hardly wait to share these with you. I am so excited about this, that I could not resist but show you three examples of 3 stocks that I picked at the bottom of wave 2, and are now entering wave three. You may know that wave 3 is usually the most powerful of all impulse waves. This means that applying this method correctly, you may be able to trade strong rallies, and/or price collapse. See 3 examples below:
For my third video, I intend to show you the details of my PCCRC strategy and 3 system approaches to profit using it. The videos will include the management of a $100,000 account.
I have not deciding on pricing, but be sure that it will only be a token amount to pay for my costs and to allow this effort to continue. If you'd like to participate, just send me an e-mail. Once I have the videos completed, I will send you details on payment, shipping and handling, etc.
My address is paperprofit1@mac.com, just send me an e-mail entitled "about your DVD's".
And remember always to "pay it forward" and exchange ideas freely.
Juan
27 comments:
hi juan,
i am looking forward to see your dvd. however will you share with us how do you find such stock before you use Ewave to analyse them?
hi again,
i try to use my ret but i get different result. what happen?
pccrc.blogspot.com
About RET:
Be sure that you are using the exact same settings as I am.
e-mail me a screenshot of your RET analysis, so I can comment.
Always be sure that you understand all the possible patterns because they are the basis of your analysis. You have to make judgments about what could or not be acceptable.
Also, I made that analysis yesterday. However, today seems to confirm what I showed to you and the three stocks are rallying today.
Finally, please be patient about my methodology, I want you to have ALL the material at once in the DVD. I have you in my list.
Juan
What setting do you have for RET? Please refer to pccrc.blogspot.com for the graph
hi,
Can you put CRC / PRC setup and conditions into the DVD? It is good for beginner to use CRC/PRC to build up our capital first before we use PCCRC.
In my first video disk, I have so far included 16 video clips explaining how I use the Elliott wave trade. The problem with the Elliott wave is to pick candidates. Advanced Get is able to select "type I and type II" trades, but I have questioned the validity of the counts. This is why I focus in my video how to do a search using Telechart or IQcharts to generate a manageable list that can be visually inspected to pick stocks about to enter wave 3. I am using the Refined Elliott Trader to confirm my counts, but anyone who understands the Elliott principles well, should be able to trade without RET. I show how in my video.
The video series further discusses how to manage an account of $10,000. I show specific examples with a paper trading account, which you'll see grow in real time. Portfolio, money and risk managements are critical, I show that in the videos as well.
I have not planned in including the CRC/PRC strategy specifically, but I am including all videos previously posted in my web site, with dates so you can go back to the blogs and look up the text associated with them. I can also include the CRC and the PCR strategy in another video. BUT my plan is to show the PCCRC in the next video. I find the PCCRC to be quite reliable when used to trade stocks that jump after earnings, but I will cover 2 other conditions.
Happy:
If you took the Elliott Certification course, you know how to use the software. In fact, you should be able to tell me if I am doing something that does not conform to the instructions given by Elliottician.com to use their software.
You'd notice also that it is somewhat subjective. You may say that it tends to confirm the biases of the operator. So it is really important that you study the Elliott patterns and learn to recognize them almost intuitively.
With my methodology, I focus on my own pattern recognition abilities, and use the software as confirmation. The main advantage of the Software is in avoiding having to do manual counts, particularly when it comes to historical data. At the very least, you have to recognize a mayor low or mayor high before applying any count. Again, this is subjective.
If you cannot reproduce my counts, look carefully at the pictures I have posted and figure out the settings. If you still get something different, get a picture of your screen and send it to me by e-mail.
hi,
i find you use different days for different stock? i use 180 for the setup? anything wrong?
Happy, the number of days in Elliott wave analysis is irrelevant, what counts is significant lows or significant highs at which to start the analysis.
If you took the Elliott Certification course required for RET users, then you know that you must do the analysis from the IPO of the stock. I would start with a monthly chart, and then analyze the last incomplete wave in more detail, in an attempt to forecast the next move. From the weekly chart you move into the daily, always analyzing the last incomplete wave until you have a detail picture of the next move.
In my first DVD, I am creating a portfolio of option positions using the Elliott wave to forecast the next move in the stock. Just give me a few more days, and the DVD will be complete. You will see how I use the Elliott wave.
For now, I suggest that you use the default settings that came with your RET.
IF you are using other software, please let me know. I have Advanced Get, but I do not believe that that software follows the Elliott tenets correctly. Still, we can explore it's use OK?
i found pccrc candidate APOG with good earning..
pccrc.blogspot.com
Happy, I examined some of the Elliott counts in stocks in your web site.
Have you applied the technique in the Elliott Certification course?
I think that you have not started the analysis from mayor lows or highs.
You may need to go back to the beginning of the stock chart, years ago, and figure out the analysis from the last completed wave.
In my videos I show several examples on how to do this.
How about the PCCRC for APOG?
In your PCCRC DVD, can you also include how to stop it.
e.g. time stop, technical stop, profit/loss stop, IV stop, roll up/down?!
regards,
Happy, I am glad you asked that question again. I forgot you have asked so.
I have said that you enter a position with a maximum RISK of 2% of the cash in your account. In the case of the PCCRC this is easily determined in the Analyze tab of TOS, or using Optionetic's Platinum. The maximum risk is your worse case scenario, of course, and you may not get there before you close your position. It is nice to know that your loss is limited in that way.
In your APOG chart, you need to look at the lower point of the chart, at about $21/share:
http://bp1.blogger.com/_kDubUJeISrE/RoMln5TVtNI/AAAAAAAAACc/TNd-_OJtnzY/s1600-h/apog+risk+27+jun+07.JPG
Now, you have entered a Jul/Nov combo. That means that 1 week before Jul expiration you are going to have to decide whether to rollover or exit the position. At that time you'd reevaluate volatility. You'd ask: is it worth to buy back the Jul and sell the Aug?. The answer would be based on selling high IV and buy low IV. It may be that the stock price is near $25 (your strike price, and you decide to make some theta profits before exiting the trade.
In general, I am happy with 30% profit, but that depends also on the time factor. Who can complain about 20% profit in 4 days? Look at the IV, is is likely to decline?
Perhaps APOG receives some debastating news and opens tomorrow at $18/share. I bet IV would jump and your long puts will offer you great profits..! perhaps that would be a good time to close the position...
The bottom line is that with the PCCRC you can afford to be reactive, rather than proactive in your trading and let the market tell you what you should do, without losing sleep at night.
I hope this help. This is a complex subject and my DVD should clarify much of that.
thank you for your explaination. as i suggested, the best is to have a matrix for all possible events and actions and results. it will be much easier to follow.
regards,
Happy, point well taken. I am going to cover some scenarios in my DVDs.
You remind me of my days as a practicing Vet when I learned to diagnosed from an infinite variety of possible disease. Decisions are best on knowledge of the theory as well as experience. I could not possibly cover every contingency.
PCCRC's are low risk high reward, but I it does require advanced knowledge of option's theory, and evaluation of stock price, time decay and option volatility. As the stock climbs, IV tends to decline. Sometimes, IV rises even if the prices stay the same, because of some underlying factor in the stock (news, earnings, hype etc.). Earnings are a big factor and one must assume that a strong decline in IV may accompany a move on earnings. BUT it is practically impossible to anticipate all contingencies. Thus, one must consider profit taking and PCCRC's are well suited to partial sell of long calls, for example.
The best way is to show individual cases and make a compilation of possible events. This could take months, if it wasn't for the back testing capabilities of Optionetics Platinum. I hope to be able to include some test book cases in my DVD.
Juan
Hello Juan wouldn't APOG be disqualified from using it as a PCCRC due to low average daily volume? RIMM looks interesting. Thanks for all your hard work Midas...
Hi Anonymous...
I recomend that you sign up with some pseudonym, that way we can keep track of your comments in the future.
APOG trades well under 1,000,000 shares on average, so I would avoid it for liquidity issues. Not surprisingly, a stock that does not trade large volumes usually have thinly traded options too. The result is that the spread between bid and ask is wide, and it becomes difficult to rollover or exit a trade at a good price.
We need all the help we can get, and slippage does not help at all. We need also low commissions. These are factors that have a larger impact than we are willing to recognize. Be sure to negotiate your commissions if you trade PCCRC's, after all, you are trading a large number of options, which is business for your broker.
In general to all: I cannot tell you what to do, I can merely make recommendations. However, if you want to get the same results I have had, you need to try to reproduce what I am doing. If you think I am making an error in assumptions, please tell me, we can explore it and in that way improve performance (hopefully). Perhaps you have made some modification to my strategy with better results, then you MUST share it!!! I want to learn from you too.
I hope it is clear by now that I don't want to be some Guru. He who speaks is not learning.
Hi Juan that was me with the above comment on APOG I was having trouble signing in so I clicked anonymous. I agree with your comments, actually when I went to the options chain and saw the large bid/ask spread it became obvious that APOG didn't meet the min daily average volume requirement.
I would like to thank you for the time and effort that you put into making the videos on using TOS to find pccrc's. I am already using TOS,Tradestation,TCnet and Esignal so I really didn't want to subscribe to Platinum although I would have if I needed to.
While doing my scan as instructed in your video I came across Rimm and APOL would you please comment on these 2 candidates please
Thanks again for all the time and effort on your blog you have also inspired me to pay it forward in other area's of my life
Midas
Midas
As a matter of fact, I am discussing RIMM and APOL in my videos, since I am working on them now. I subconsciously felt that I had covered those two stocks and skip your question unadvertedly.
Why don't you make the case for and against RIMM and APOL?
I would focus on earnings and on post-earnings IV.
Juan
From my analysis on APOL this seemed to fit the requirements for a PCCRC candidate
Stock price above $50 + up more than 10%
Mike Jaffe, an analyst at Standard & Poor's, said the company's earnings per share beat his forecast by 8 cents. Enrollment gains and operating margins were stronger than he forecasted.
He raised his 2007 estimate by 15 cents to $2.40 and that for 2008 by 30 cents to $2.65.
Imp vol aprox .33 but past 2 earnings reports vol went up to about .39
Average daily volume above 1 million
The concerns I have are as follows
The iv/sv ratio changed today 7/3/7
They reported earnings on 5/21 and again on 6/28 (not sure why)
From my analysis on RIMM this seemed to fit the requirements for a PCCRC candidate
Stock price above $50 + up more than 10%
Research In Motion saw earnings jump 73% for the first quarter ended June 2, hitting $223.2 million compared with $128.8 million for the same period last year. Earnings per share came in at $1.17 compared with 67 cents the previous year.
Analysts had expected the company to earn $1.06 per share for the recent period, according to estimates from Thomson Financial.
iv/sv ratio is good
average daily volume is high
The only concern I have with RIMM is that iv only dropped a few percent after earnings
As recent as 2 months ago iv was around 28%
Currently iv is at 39%
So further downside is possible for the iv
This is my humble opinion I look forward to your analysis to see your point of view on these candidates.
Midas...
Midas, thanks for reviewing the info for us.
I looked at APOL, and the article I read said that the revenue growth going forward was going to be less than 10%. Here is the article I read:
http://biz.yahoo.com/ap/070628/earns_apollo_group.html?.v=4
Apollo President Brian Mueller said he was pleased with the revenue growth, but he cautioned that the company still expects to see future revenue increases in the "mid- to high-single-digit" range.
Granted, the earnings were very good, but I am also interested in forward looking statements.
I always like share buybacks, but that assumes that management knows what it is doing.
Obviously, there is going to be a bit of a subjective judgment here, but I think that as long as you follow the rules on volatility, you should do well. That is why I trade a PCCRC, 'cause sometimes one ends up being wrong!
You have summarized RIMM well for me, however, if you had entered a position on it already, IV is working in your favor. Nothing better than increase IV and share price at the same time.
I was not lucky enough to have my trade filled, so I have to be content with having it in my paper trading account.
RIMM is the stereotype of the position I want to enter, even if IV is higher than after earnings, it is still on the rise.
I want you to focus on the possible Vega gains. SO as long as you can project IV increases and/or Delta increases, you should be OK.
Dear Juan and all,
I have already made it known that Juans efforts for this project have already got a confirmed purchase from me.
Ken Trester in his DVD Secrets to winning the Options Game, suggests it is important to go for home runs. This is in fact what Juans strategy is all about.
I quote Trester who says this;
"Getting small returns using Options is not going to work. Getting enough home runs to offset that 'take' (Commission and Bid/Ask Spread) and errors that one makes too."
Trester quotes Loeb, who states;
"The inevitability of loss, when attempting to secure a safe income of small return." He goes to "...suggest speculation rather than investment as the policy less apt to show a loss and more apt to show a profit."
In my mind that is why the PCCRC fits the ideal vehicle for this concept.
hi,
i think ken's strategy is to buy very cheap option and once there is a home run it compensate all the losses. please correct me if i am wrong.
if it is the case, i don't think PCCRC suit it. PCCRC emphasize on consistent profit at 20-30% every trade, not 5000% vs 0%.
feel free to give any comment
regards,
Any trade can be a homerun if you have more longs than shorts.
This is why I don't like butterflies, calendars or vertical spreads. Is like advanced sale (collar) that limits your profits. To be sure you limit your risk, but you can also limit your risk by reducing the contract size to a minimum, rather than reducing cost by selling at the outset.
This is why I trade long calls and long puts, place my trailing stop and forteg about the trade. I cover all this in my first first DVD. BUT you MUST have a reason to enter a candidate. Elliott wave, fundamentals, moving averages, etc.... You don't need a home run (although it does happen), but your winners usually outperform your losers manyfold.... That only happens if you have more longs than shorts.
The PCCRC involves that phylosophy too. Hence the results with AQNT. Yes, you CAN hit a homerun with the PCCRC because you DO have more longs than shorts both in the call and put side of the ecuation.
To me the two features of options are limited risk and leverage. The leverage is severely limited with spreads....
Yes, there is a time for butterflies in the like, but for the rest of the time, you should maximize (not limit) gains with options.
Ultimately, however, is about what you are confortable with. I just don't like spreads.
Happy Trade,
Thanks for the input and comments. Apologies for the delay in getting back to you, as I have had my attention drawn to other things.
RE: “i think ken's strategy is to buy very cheap option and once there is a home run it compensate all the losses.”
You probably know more about him than I do, as I have only got half way through his first disc. **Smiles**
RE: “i don't think PCCRC suit it. PCCRC emphasize on consistent profit at 20-30% every trade, not 5000% vs 0%.”
With due respect, if you look at the risk graph for the PCCRC, a big move in either direction is the home run. The PCCRC does not always show a profit, as I have experienced on some individual cases, which can bee seen in the middle of the risk graph. Therefore it is the home runs on the PCCRC that overcome the small losses on the PCCRC that does not come good. As Juan said, “any trade can be a homerun if you have more longs than shorts”.
Obviously these are my opinions, but what Ken Tresner said, in his trading psychology, as I said before “IN MY MIND that is why the PCCRC fits the ideal vehicle for this concept.”
Again thanks for the input, as to question and doubt are fundamental in tweaking the system.
We all know that Options provide leverage. I like the idea of hitting a home run once in a while and then do something special, like taking a trip, or buying something I want.
However, once I started trading the PCCRC, I discover that my losses were being reduced significantly. Limiting the risk is also a great feature of options that many let pass.
I don't very much like trading OTM options, because it requires being right not only about direction and timing but also about the magnitude of the change. ALL very difficult. So no, I don't think my method is the same as the Tresner, although there are close similarities.
In my first disk I cover the use of the Elliott wave to identify candidates for short-term options (2 month to expiration). This is SWING trading, rather than POSITION trading as in the PCCRC strategy. Here too, I use ATM calls or puts. The trailing stop assures me that my losses are going to be small and that profit will be taken in a timely manner. I here too, expect a homerun once in a while, but also anticipate good gains fairly routinely.
I think that it is the OTM options what makes Tresner's method more of a high risk high reward method.
Happy and/or Fortitude, please post information about obtaining the Tresner video disk.
Juan,
Sorry I have the name slightly wrong Ken Trestner;
http://www.options-inc.com/aboutus/about.html
http://www.amazon.com/s/ref=nb_ss_gw/105-4564846-8988469?initialSearch=1&url=search-alias%3Daps&field-keywords=ken+trester&Go.x=12&Go.y=13
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