Today’s video guides you through the two ways you can build entry & exit orders when scaling in & out.

Notes

Full size: 3 contracts

All at once: Sell 3 contracts

Scale in: Sell 1 contract 3 different times.

Template for 3 contracts

Tier One: Sell for X premium (50 cents)

Tier Two: Sell for 1.5X Premium (75 cents)

Tier Three: Sell for 2X Premium ($1.00)

Order Entry:

Choice 1) Automate everything.

                Sell limit 50 cents                             Target: 10 cents (40 cent profit)

                Sell limit 75 cents GTC                    Target: 35 cents (40 cent profit)

                Sell limit $1.00 GTC                         Target: 60 cents (40 cent profit)

Pro: you don’t have to think about it. It’s pre-set: Plan your trade and trade your plan

Con: you might get a better price if you waited for a trigger AFTER the put premium rose to tier 2 or tier 3

Choice 2) Set alerts and wait for a trigger to pull you into tier 2 and tier 3

                Sell limit 50 cents. Watch for the put to rise to 75 cents. At that point wait for stock to rise above prior day’s high or intraday resistance and signal it’s starting to bounce.

Pro: you don’t increase size by adding tier 2 or 3 UNTIL the chart moves back in the right direction.

Pro: you do better at timing the 2^nd and 3^rd entry b/c you’re using TA.

Con: you have to be there when it triggers to enter the trade.

Con: you might miss it.

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