![Page 1: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/1.jpg)
Identifying Key Support and Resistance Levels
presented by
Thomas Wood | MicroQuantSM
Swing Trading Success – Debit Spreads –
![Page 2: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/2.jpg)
Submit All Questions Via GoToWebinar Side Menu
![Page 3: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/3.jpg)
Risk Disclaimer Trading or inves-ng carries a high level of risk, and is not suitable for all persons. Before deciding to trade or invest you should carefully consider your investment objec-ves, level of experience, and ability to tolerate risk. This content is subject to change at any -me without no-ce, and is provided for the sole purpose of educa-on and assistance in making independent investment decisions. ValueCharts.com has taken reasonable measures to ensure the accuracy of the informa-on contained herein; however, ValueCharts.com does not guarantee its accuracy and is not liable for any loss or damage which may result directly or indirectly from such content or from an inability to access such informa-on or any delay in or failure of the transmission or the receipt of any instruc-on or no-fica-on in connec-on therewith. Any past performance results are shown for illustra-on and example only, are hypothe-cal and as such have many inherent limita-ons. No representa-on is being made that any account will or is likely to achieve profits or losses similar to those shown. Past performance is not necessarily indica-ve of future results.
![Page 4: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/4.jpg)
CFTC Rule 4.41 (Hypothetical Disclaimer)
U.S. Government Required Disclaimer -‐ Commodity Futures Trading Commission Futures and Op-ons trading has large poten-al rewards, but also large poten-al risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and op-ons markets. Don't trade with money you can't afford to lose. This is neither a solicita-on nor an offer to Buy/Sell futures, stocks or op-ons on the same. No representa-on is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indica-ve of future results. CFTC RULE 4.41 -‐ HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-‐OR-‐OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE DISCUSSED WITHIN THIS SITE, SUPPORT AND TEXTS. OUR COURSE(S), PRODUCTS AND SERVICES SHOULD BE USED AS LEARNING AIDS ONLY AND SHOULD NOT BE USED TO INVEST REAL MONEY. IF YOU DECIDE TO INVEST REAL MONEY, ALL TRADING DECISIONS SHOULD BE YOUR OWN.
![Page 5: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/5.jpg)
About Me… Formal info
• 1995 Graduate of Vanderbilt University
• Full Broker at 23 with Merrill Lynch
• 12 Year Senior Advisor Vanguard Asset Management Service
• 27 months in Stocks & Op-ons Live Trading Room
![Page 6: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/6.jpg)
Swing Trading
• Importance of Time Frame
• Swing Trading defini-on
• The Hourly Chart
• How to Swing on the Hourly chart
![Page 7: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/7.jpg)
Swing Trading
• Fine Tuned Trading – ½ Size Charts
• Technical Analysis Pajerns that work on a 60 min.
![Page 8: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/8.jpg)
Debit Spread Basics
• What is a Debit Spread?
• Trading Stocks/ETFs vs Debit Spreads
• Basics of Debit Spreads – Strengths & Weaknesses
![Page 9: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/9.jpg)
Debit Spread Basics
• Debit Spreads – Key to trading Small Accounts
• What you need to know to trade Debit Spreads well…
![Page 10: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/10.jpg)
Debit Spread Construction
• The Basics – buy op-on, sell further away
• Where to place Strikes?
• How Wide?
![Page 11: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/11.jpg)
Debit Spread Construction
• How long un-l expira-on?
• Profitable, now what? … Staged Profits
![Page 12: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/12.jpg)
Debit Spread Trading Plan
• Setup your Trade Parameters
• Searching for Opporuni-es
• Leong the Trade Develop & come to you
![Page 13: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/13.jpg)
Debit Spread Trading Plan
• Do the trade on the ½ Size chart
• Execute the trade on the :45s
• Set your StopLoss
![Page 14: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/14.jpg)
Debit Spread Trading Plan
• Evaluate every :30 and :00
• Take Staged Profits
• Take care of the last 20%
![Page 15: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/15.jpg)
Debit Spread Trading Plan
• 12 Pages of Wow!
• Put it all together…
![Page 16: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/16.jpg)
Swing Trading
![Page 17: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/17.jpg)
Swing Trading
• Swing Trading defini-on
– Trades in a respec-ve Timeframe that lasts more than one trading day
– Usually “in a trade” across 2 – 4 trading days
![Page 18: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/18.jpg)
• The Importance of Timeframe
-‐ Timeframe – the length of -me per chart bar -‐ Bigger -meframes represent bigger Price Bars
-‐ Bigger Price Bars, bigger $$$ poten-al moves
-‐ Danger, Larger Stop Loss distances
Swing Trading
![Page 19: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/19.jpg)
• The Importance of Timeframe
-‐ Slower, more manageable Entry points (you have -me)
-‐ Tick charts : about 30 seconds a bar
-‐ Time Charts : 5min, 15minute, 60 minute bars
-‐ Easier to enter, flexibility to use ½ size Time charts
Swing Trading
![Page 20: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/20.jpg)
• Why Swing Trade?
-‐ Even on Swing Trades, stocks don’t move in straight line
-‐ Fibonacci levels work very well on 60 minute charts
-‐ Plan for a “measured” move & structure Debit Spread accordingly
Swing Trading
![Page 21: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/21.jpg)
Swing Trading
![Page 22: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/22.jpg)
• Why Swing Trade?
à TREND TRADES ß -‐ Trend Trades / Breakouts are more plen-ful
-‐ Trending moves are more plen-ful on longer -meframes
-‐ See the trend on 60minute & Daily charts
-‐ Trends tend to persist within those frameworks.
Swing Trading
![Page 23: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/23.jpg)
Swing Trading
• The Hourly Chart –
– The best chart to use for swing trades that last 2 – 4 trading days is the 60 minute (Hourly) chart.
– There are 6 – 7 Bars a day, each trade move is 12 – 24 bars
![Page 24: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/24.jpg)
Swing Trading
![Page 25: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/25.jpg)
Swing Trading
• The Hourly Chart –
– Very commonly used -meframe. – Hourly Support & Resistance levels
– TA Price Pajerns usually are successful because everyone sees them and trades them
![Page 26: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/26.jpg)
Swing Trading
• The Hourly Chart –
– Op-mize Trading by adding
– “Higher TF” Daily EMAs (8 day, 50 day)
– Support & Resistance levels from Weekly & Monthly charts
![Page 27: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/27.jpg)
Swing Trading
![Page 28: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/28.jpg)
Swing Trading
![Page 29: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/29.jpg)
Swing Trading
• Fine Tuned Trading – ½ Size Charts
– When using 60 minute charts for TA pajerns,
– Use a 15 & 5 minute chart to get a “headstart” on the entry bar
– Evaluate entrys at (x:45), using 60, 30, 15, 5 minute charts
![Page 30: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/30.jpg)
Swing Trading
![Page 31: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/31.jpg)
Swing Trading
• Technical Analysis Pajerns that work on a 60 min.
Reversals : Divergences Fibonacci Retracements
![Page 32: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/32.jpg)
Swing Trading
• Technical Analysis Pajerns that work on a 60 min.
Trends : • Bullish Breakout, push higher through Resistance level
• Bearish Breakout, push lower through Support level
![Page 33: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/33.jpg)
Swing Trading : Quiz
![Page 34: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/34.jpg)
Swing Trading
1. How many Hourly Bars are there in a typical “Swing Trade?”
![Page 35: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/35.jpg)
Swing Trading
Q1. How many Hourly Bars are there in a typical “Swing Trade?”
• Answer : typically 12 -24 – Swing Trades last 2-4 days, with around 6
bars hourly per day, should be 12-24 bars for the expected trade move from the entry bar.
![Page 36: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/36.jpg)
Swing Trading
Q2. True or False. “Trending Trades appear a lot less frequently in the Hourly timeframe. “
![Page 37: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/37.jpg)
Swing Trading
Q2. True or False. “Trending Trades appear a lot less frequently in the Hourly timeframe. “ • Answer : FALSE
– Swing Trades are more frequent in the Hourly timeframe than the intraday timeframes of 1, 3, 5 minute timeframes. Almost even 50/50.
![Page 38: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/38.jpg)
Swing Trading
Q3. Name one way to reduce the Entry Trade risk when getting into a Swing Trade.
![Page 39: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/39.jpg)
Swing Trading
Q3. Name one way to reduce the Entry Trade risk when getting into a Swing Trade.
• Answer : use a Smaller Timeframe – Swing Trades are usually done on an Hourly
chart. Use a 30, 15, or 5 minute chart to get a “headstart” around “:45”, before the close of the bar.
![Page 40: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/40.jpg)
Debit Spread Basics
![Page 41: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/41.jpg)
Debit Spread Basics
• What is a Debit Spread?
-‐ Basic level of Op-ons knowledge -‐ Deriva-ve of stock -‐ Delta : value changes with stock price -‐ Theta : value decreases with -me to expira-on
![Page 42: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/42.jpg)
Debit Spread Basics
• What is a Debit Spread?
-‐ Simultaneous long/short posi-ons of op-ons… -‐ Same underlying stock -‐ Same op-on type : call, put -‐ Same expira-on date
![Page 43: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/43.jpg)
• Debit Spreads – the Basics
-‐ Debit Spread, pay for spread once placed
-‐ Loss is limited to amount invested.
-‐ No need for “margin”
Debit Spread Basics
![Page 44: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/44.jpg)
Debit Spread Basics
-‐ Bullish : Call Debit Spread
-‐ Profits when price moves higher
-‐ Maximum profit @ expira-on -‐ when price is higher than long call strike
![Page 45: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/45.jpg)
Bullish Call Debit Spread
![Page 46: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/46.jpg)
Debit Spread Basics
-‐ Bearish : Put Debit Spread
-‐ Profits when price moves lower
-‐ Maximum profit @ expira-on -‐ when price is below than long put strike
![Page 47: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/47.jpg)
Bearish Put Debit Spread
![Page 48: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/48.jpg)
Debit Spread Basics
• Trading Stocks/ETS vs Debit Spreads
– Trading stocks/ETFs • Easier entry, simple brokerage order • Smaller Bid/Ask spread • Cheaper “stocks” commission rate • Rela-vely simple % return
![Page 49: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/49.jpg)
Debit Spread Basics
• Trading Stocks/ETF
• $200 priced stock/ETF x 100 shares = $20,000 cost
• $5 move to $205 x100 shares = $500 profit
• % Return = $500/$20,000 = 2.5% return
![Page 50: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/50.jpg)
Debit Spread Basics
• Trading Stocks/ETS vs Debit Spreads
– Trading Op-ons / Debit Spreads • More complicated order entry
– Need to watch op-on volume
• Bid/Ask spreads both help & hinder order fills
• Because two op-on orders, 2x commission cost
• BENEFIT : LEVERAGE !!!
![Page 51: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/51.jpg)
Debit Spread Basics
• Trading Debit Spreads
• $200 priced stock
• 200/205 Call Debit Spread = $1.50x100 = $150 cost
• $5 move to $205, Spread value $3.00x100 = $300 value
• % Return = $150 cost /$150 profit = 100% return
![Page 52: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/52.jpg)
Debit Spread Basics
• Basics of Debit Spreads – Strengths & Weaknesses
![Page 53: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/53.jpg)
• Debit Spreads – the STRENGTHS
-‐ LEVERAGE : Average trade profit is 50% or higher
-‐ Small cost to entry. Most $5 wide spreads cost $1 or $2
-‐ Easy to enter and exit in highly liquid stocks
-‐ S-ll have poten-al trades in less liquid stocks
Debit Spread Basics
![Page 54: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/54.jpg)
• Debit Spreads – the Weaknesses
-‐ You are Long Op-ons, some Theta effect
-‐ Timing of entry & exit are important parts of trade
-‐ Moves need to happen rela-vely soon
-‐ Don’t hesitate to take profits when they appear
Swing Trading Success
![Page 55: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/55.jpg)
Debit Spread Basics
• Debit Spreads – Key to trading Small Accounts
-‐ Debit Spreads are “CHEAP” -‐ $100 -‐ $200 for $5 wide spreads with 14 days
-‐ Maximum risk is limited to Debit Paid
-‐ Control risk per trade to foster steady account growth
![Page 56: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/56.jpg)
Debit Spread Basics
• Debit Spreads – Key to trading Small Accounts
-‐ Can be applied to “Big” stocks with no addi-onal cost – allows par-cipa-on in explosive moves
-‐ Also, wider universe of Stocks & ETFs can be traded on Swing Trade -meframe with no “penal-es”
![Page 57: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/57.jpg)
Debit Spread Basics: Quiz
![Page 58: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/58.jpg)
Debit Spread Basics
Q1. When Constructing a Debit Spread, the following is true.
• Debit Spreads is both long and short the same “type” of option
• They have different expiration dates • They have to be $5 wide spreads
![Page 59: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/59.jpg)
Debit Spread Basics
Q1. -
• With Debit Spreads, both long and short options are the same “type” of option
![Page 60: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/60.jpg)
Debit Spread Basics
Q1. Answer
• Debit Spreads is both long and short the same “type” of option
• TRUE • Bullish : Long/Short Call Options • Bearish : Long/Short Put Options
![Page 61: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/61.jpg)
Debit Spread Basics
Q1. • They have different expiration dates
![Page 62: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/62.jpg)
Debit Spread Basics
Q1. Answer
• They have different expiration dates • FALSE • The Spread must have the SAME option
expiration date
![Page 63: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/63.jpg)
Debit Spread Basics
Q1. • They have to be $5 wide spreads
![Page 64: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/64.jpg)
Debit Spread Basics
Q1. Answer
• They have to be $5 wide spreads
• FALSE • The Spread can be any distance between
the strike prices. (within reason – usually $5,10, 15, 20 wide)
![Page 65: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/65.jpg)
Debit Spread Basics
Q2. Why are Debit Spreads well suited for trading Smaller Size Accounts?
![Page 66: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/66.jpg)
Debit Spread Basics
Q2. Why are Debit Spreads well suited for trading Smaller Size Accounts?
• Answer : – Debit Spreads have a very low cost to enter
a position : $100-$200 a spread – Debit Spreads have a known “maximum” loss – Debit Spreads have a very nice potential
returns of 75%, 150%, +200% returns.
![Page 67: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/67.jpg)
Debit Spread Basics
Q3. One major concern for Debit Spread trades is Theta, or Option Decay.
![Page 68: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/68.jpg)
Debit Spread Basics
Q3. One major concern for Debit Spread trades is Theta, or Option Decay.
• Answer : FALSE – With a well constructed Debit Spread, with
enough time left until expiration, Theta or Time Decay is nullified by having long and short positions, until a point where there is less than 7 days until expiration.
![Page 69: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/69.jpg)
Debit Spread Construc-on
![Page 70: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/70.jpg)
Debit Spread Construction
• Process the Poten-al Move • Iden-fy the Profit Target Zone
• Iden-fy the Stop Loss level
![Page 71: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/71.jpg)
Debit Spread Construction
• Process the Poten-al Move – With guidance from the Daily Chart – Iden-fy how far the trade could go on 60 min
![Page 72: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/72.jpg)
Debit Spread Construction
• Iden-fy the Profit Target Zone – Use TA Guides
• Fibonacci Retracement Levels (38.2%, 50%, 61.8%) • Daily 8EMA, Daily 50EMA • Weekly/Monthly Support & Resistance levels
– “Bracket” a reasonable $5 or $10 wide Target Profit zone
![Page 73: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/73.jpg)
Target Profit Zone
![Page 74: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/74.jpg)
Debit Spread Construction
• Iden-fy the Stop Loss level – Within the 60 min chart, iden-fy price level in which to set Stop Loss
• For Reversals: previous high/low levels
• For Breakouts: – Fall back below resistance, or above support – Pullbacks into consolida-on zone
![Page 75: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/75.jpg)
Debit Spread Construction
• The Basics – buy op-on, sell further away
![Page 76: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/76.jpg)
Debit Spread Construction
• Where to place Strikes?
• Strike Prices of Debit Spreads should bracket the Profit Target Zone of the trade
![Page 77: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/77.jpg)
Picking the Strike Prices
![Page 78: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/78.jpg)
Debit Spread Construction
• Where to place Strikes?
• Strike Prices of Debit Spreads should bracket the Profit Target Zone of the trade
• Conserva-ve – ATM/ITM strike & OTM strike
• Aggressive – OTM strikes near Profit Target $
![Page 79: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/79.jpg)
Conservative vs Aggressive Spreads
![Page 80: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/80.jpg)
Debit Spread Construction
• How Wide?
• Wide –
• Mix of ATM/OTM –
• Easier to profit, overall smaller % return
![Page 81: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/81.jpg)
Debit Spread Construction
• How Wide?
• Narrow – finely tuned,
• Aggressive OTM, biggest profit poten-al
![Page 82: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/82.jpg)
Wide vs Narrow Spreads
![Page 83: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/83.jpg)
Debit Spread Construction
• How long un-l expira-on? • Need just enough -me to complete the trade but not much more
• Normal Trade • Swing Trade : 2-‐4 days • Add 7-‐10 more • Target “days to expira-on” : 9-‐14 days
![Page 84: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/84.jpg)
Debit Spread Construction
• How long un-l expira-on?
• Conserva-ve Trade • Normal “days to expira-on” : 9-‐21 days • (Add +7 day buffer) • Conserva-ve “days to expira-on” : 14-‐21 days
![Page 85: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/85.jpg)
Debit Spread Construction
• How long un-l expira-on?
• Aggressive Trade • Swing Trade : 2-‐4 days • Add + 4 days
• Aggressive “days to expira-on” : 6-‐8 days
![Page 86: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/86.jpg)
Debit Spread Construction
• Sample Calcula-on: Projected trade – 3 Days • Calculate Normal • Conserva-ve • Aggressive
![Page 87: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/87.jpg)
Debit Spread Construction
• Profitable, now what? … Staged Profits
![Page 88: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/88.jpg)
Debit Spread Construction
• Staged Profits • Along the path of the Profit Target Zone iden-fy…
• Support & resistance price levels • Daily moving averages • Fibonacci levels
![Page 89: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/89.jpg)
Staged Profit Plan
![Page 90: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/90.jpg)
Debit Spread Construction
• Support & resistance price levels – Daily & Weekly price levels
• Daily moving averages – 8 Day & 50 Day Exponen-al Moving Averages
![Page 91: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/91.jpg)
Debit Spread Construction
• Fibonacci levels
– On retracements : 38.2%, 50%, 61.8%
– On extensions : 127%, 162%
![Page 92: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/92.jpg)
Debit Spread Construction
• Staged Profits
• Iden-fy 2 or 3 “proven” levels, that have had previous interac-ons of stock trend
• Divide posi-on into 2 or 3 groups to ini-ate sells
![Page 93: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/93.jpg)
Staged Profit Plan
![Page 94: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/94.jpg)
Debit Spread Construction
• If enough shares/contracts…
• Leave small por-on as “runner”, placing a lock-‐in profit stop loss.
• This “runner” might be start of a very large move.
![Page 95: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/95.jpg)
Interac-ve Exercise
![Page 96: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/96.jpg)
Interactive Exercise
![Page 97: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/97.jpg)
Debit Spread Construction
• Type of Poten-al Trade?
![Page 98: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/98.jpg)
Interactive Exercise
![Page 99: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/99.jpg)
Debit Spread Construction
• Where is the Profit Target Zone?
![Page 100: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/100.jpg)
Interactive Exercise
![Page 101: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/101.jpg)
Debit Spread Construction
• Iden-fy Poten-al Strike Prices.
• Iden-fy Stop Loss Level
![Page 102: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/102.jpg)
Interactive Exercise
![Page 103: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/103.jpg)
Debit Spread Construction
• What is your Entry Point?
![Page 104: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/104.jpg)
Interactive Exercise
![Page 105: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/105.jpg)
Debit Spread Construction
• Where are your Staged Profit Points?
• What is your Profit Taking Plan?
• Runner?
![Page 106: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/106.jpg)
Interactive Exercise
![Page 107: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/107.jpg)
Debit Spread Construction
• Walk-‐Through Trade one more -me…
![Page 108: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/108.jpg)
Interactive Exercise
![Page 109: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/109.jpg)
Debit Spread Construc-on: Quiz
![Page 110: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/110.jpg)
Debit Spread Construction
Q1. How do you decide what Strike Prices to use for your Debit Spread?
![Page 111: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/111.jpg)
Debit Spread Construction
Q1. How do you decide what Strike Prices to use for your Debit Spread?
• Answer : – The Profit Target Zone, the price level where
your believe your trade will move to, will determine your strike prices.
– Also, how aggressive or conservative you be in your trade, affects your selection
![Page 112: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/112.jpg)
Debit Spread Construction
Q2. Why do more Aggressive Trades have shorter “days until expiration?”
![Page 113: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/113.jpg)
Debit Spread Construction
Q2. Why do more Aggressive Trades have shorter “days until expiration?”
• Answer : – Normally, options with less “days until expiration”
are more affected by Delta price moves in the underlying.
– Also, max profit in an ITM spread occurs at expiration, because the Theta effect is stronger on short option than the ITM long option – widening the value of the spread.
![Page 114: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/114.jpg)
Debit Spread Construction
Q3. What is the process that I use in taking profits that helps me boost my “win ratio”?
![Page 115: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/115.jpg)
Debit Spread Construction
Q3. What is the process that I use in taking profits that helps me boost my “win ratio”?
• Answer : – I take profits, in a Planned Staged Profits
process. By using 2 or 3 logical points in the projected move towards the Profit Target Zone, I take profit “winners” by selling some percentage of my overall positions at the “profit sell points”
– I also move my stop losses to breakeven trades when there is a profit, then eventually lock-in some profits with trailing stops.
![Page 116: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/116.jpg)
Detailed Debit Spread Trading Plan
![Page 117: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/117.jpg)
Debit Spread Trading Plan
• Setup your Trade Parameters
-‐ Determine appropriate trade size -‐ For me, define risk of loss at 50% spread -‐ Divide total max loss by amount of 50% spread = # contracts
![Page 118: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/118.jpg)
Debit Spread Trading Plan
• Searching for Opporuni-es
• Search on the :45s – Look at 60min, 15 min, 5 min charts
![Page 119: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/119.jpg)
Swing Trade Entry Charts
![Page 120: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/120.jpg)
Debit Spread Trading Plan
• Leong the Trade Develop & come to you
• It might take 1 or 2 days for a poten-al trade to develop enough to take a posi-on
• Maintain an ongoing “watch list” of poten-al opportuni-es 1-‐2 days out
![Page 121: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/121.jpg)
Debit Spread Trading Plan
• Do the trade on the ½ Size chart
• Once you see a poten-al trade to develop on the 60 minute chart
• Iden-fy the parameters to “pull the trigger” on the trade
![Page 122: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/122.jpg)
Debit Spread Trading Plan
• Execute the trade on the :45s based on price ac-on on the 15 minute or 5 minute charts
• Use limit orders to fine tune entry price
• Don’t rush, watch for 2nd chance entrys – Breakouts : last kiss pullbacks – Reversals : sideways bounces, 3rd top/bojoms
![Page 123: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/123.jpg)
Swing Trade Entry Charts
![Page 124: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/124.jpg)
Debit Spread Trading Plan
• Set your StopLoss
• Beware the big stoploss move
• Enter on smaller TF opportunity
![Page 125: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/125.jpg)
Debit Spread Trading Plan
• Watch for Opposite Trend develop in smaller -meframe which may give clues to “wrong” trade
• If small TF says “wrong” but Large TF says “right”, it is OK to reduce posi-on size
![Page 126: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/126.jpg)
Debit Spread Trading Plan
• Evaluate Posi-on every :30 and :00
• Remember this is a bigger TF opportunity
• Don’t “stare” at the trade for the next 4 days
• Don’t watch your P&L
![Page 127: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/127.jpg)
Debit Spread Trading Plan
• Check it every 30 minutes.
• Con-nue to watch the Indexes, usually you are trading in the same direc-on
• Again, Don’t watch your P&L – this leads to rash decision making
![Page 128: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/128.jpg)
Debit Spread Trading Plan
• Take Staged Profits • Set out your 2 or 3 “Planned” profit taking levels
• As you approach your levels, start to watch on 5 minute charts
• Use limit orders to “sell into strength”
![Page 129: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/129.jpg)
Debit Spread Trading Plan
• Take care of the difficult last 20%
• Through experience, you’ll find out that the first 80% of a well thought out trade is an easy trade – prices moves quickly, easy to take profits selling into strength
• The last 20%, especially when prices start to encounter some resistance, it may be more challenging to sell at your price. You may have to be a lijle more aggressive with price to get out.
![Page 130: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/130.jpg)
Debit Spreads Summary
![Page 131: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/131.jpg)
Ques-ons & Answers
![Page 132: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/132.jpg)
Debit Spread Trading Plan Checklist
• Next Steps…
1st Time Around – Review Workshop recording
• Setup 60min/Daily Scan charts
• Look for trades on daily chart, and 60 minute
![Page 133: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/133.jpg)
Debit Spread Trading Plan Checklist
• When poten-al Swing Trade setups start to form
• Iden-fy 2 – 4 day move, Target Profit Zone
• Structure your Debit Spread Strike Price levels and Time Un-l Expira-on.
• Iden-fy Entry point, Use 5min & 15 min charts to enter the posi-on
![Page 134: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/134.jpg)
Debit Spread Trading Plan Checklist
• Once your “in the trade”
• Set stop loss
• Setup your 2 – 3 Profit Taking Levels
• Watch Trade every 30 minutes, Watch indexes
![Page 135: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/135.jpg)
Debit Spread Trading Plan Checklist
• Carry out Profit Taking Exit Trades, as each level is hit.
• Adjust to Break-‐even & Profit Locking Stop loss Order at each planned Exit
• Leave “runner” on with logical Stop Loss
![Page 136: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/136.jpg)
Example Stock List for Debit Spreads
![Page 137: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/137.jpg)
Example Stock List for Debit Spreads
![Page 138: Swing Trading Success Debit Spreads Workshop …...Swing Trading Success(Debit Spread Basics(• DebitSpreads(–Key(to(trading( Small(Accounts(L DebitSpreads(are(“ CHEAP” L($100(L($200(for($5(wide(spreads(with(14(days((L](https://reader034.vdocuments.net/reader034/viewer/2022042506/5f4ec542784e17311a4d6f6c/html5/thumbnails/138.jpg)
Thank You