Tackle Today: Trading Canticle
October 4, 2018
≈ Parsley, sage, rosemary and thyme. ≈
Your trading systems, by nature, could be independent in rhythm and contour. On one hand, you have a directional system, a breakout/breakdown one, for example, whereas, on the other hand, you have a cashflow non-directional system. One that trades Iron Condors, for instance.
In music, we have what it’s called a Counterpoint. The Counterpoint is defined as the relationship between voices that are harmonically interdependent yet independent in rhythm and contour. It implies that different melodic lines are combined in a musical composition. Your trading account is the composition, in this case. The Magnum Opus.
Each voice, being Delta and Theta in our example, can stand on its own, of course. But you can take it to another level. Instead of mashing them back to back, you can play them simultaneously. This way, they become even stronger.
The market is choppy and you can’t pick a direction: no problem. Your canticle is safe and sound because your Cashflow System is there.
The market picked a direction and your Iron Condors are being challenged each and every month. Keep playing the canticle: the Delta voice is counterbalancing the threatening of the short strikes.
Let me know that at least she will try
And then she’ll be a true love of mine
Chart of the Day
Scarborough Fair
Scarborough Fair is a traditional English ballad. Paul Simon took it to another level, setting the composition in counterpoint with “Canticle” – a reworking of the lyrics from his anti-war song, “The Side of a Hill”. The resulting composition is beautiful and powerful and can server as an inspiration for us traders. One voice can be our Delta System. The other, our Cashflow System.
Video of the Day
Exiting Adjusting or Hedging a Bear Call Spread gone bad
Coach T answers a question on how to handle a Bear Call Spread that is moving against you.
Today’s Lineup
ROOKIE CORNER
Lets go hunting – Part V
“I noticed last week that I used the term “Rookie” quite a bit in the last few episodes of this blog. Now, I understand that some of you in here will be bonafide rookies but I also understand that some of you, if you have followed this blog to this point, are no longer really rookie but legit traders at this point.
Coaches Lounge 11am EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
Cashflow Club 8:30PM EST
Held every Thursday before Friday’s option contract expirations, this show helps you perfect your favorite cashflow strategies.
Tackle 25 MMG Replay
If you missed last night’s mastermind group’s encounter with Coach Tim Justice, you can watch it by clicking the link below.
Halftime Report 12:30pm EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.
Market Recap 4:30pm EST
The Market Recap is designed to give you a quick overview of the day that was. While brief, this report is designed to cover all of the major events that drove the markets that day and help you plan for the trading day ahead.
