Support and Resistance
Support and Resistance
ThuhKang shares his strategy of combining the BlackBoxStocks option flow with support and resistance to intraday trade.
I really love the BlackBox system because it boils down a lot of information that is easy to read and easy to interpret in ways for you to make quick decisions when trading. The first thing I want to do before I decide to take a trade is go into the chart, which I don’t even have to leave the platform to do. I can basically go right over to the chart on the left-hand side of the screen; you can also enlarge the chart if you like. I just like to keep everything simple and in their frames. But basically, you can come over to the chart and it allows you to analyze all of the data BlackBox has provided at our fingertips.
Trading Using Simple Charts
In terms of where we are with support and resistance, or where we are long-term; I first think, “do I really want to take the trade?” ROKU has been on a tear today, and I did decide to take this. Another thing that I like here is that the options flow breaks down each call, put, sweep, etc. But you can also see overall what are the most active for the day. So again, if I’m looking at the trade and I see they’re sweeping into ROKU, you can see that we’ve had a lot of calls coming in today for them. You can also take a look and see what the big money is doing, and what the collective enthusiasm is behind a position. I see here that a little over 2 million dollars is coming to ROKU today, over thirty-two positions, again, that’s a lot of money coming in today. It’s something that I want to take a look at.
I can see for an intraday trade we did have a little dip this morning, but as we get that excitement throughout the day and ROKU starts to rise, or ROKU starts to appreciate in value throughout the day, the price action starts to move up. One of the things that I like to play here is chart patterns. This broken trade was from December the 20th, and I did go out for the December 20th 165’s. But at the same time, I did play this intraday as well, off of the chart pattern that ROKU was showing.
So, as you can see, I could have drawn these support and resistance lines. You can definitely draw in the chart’s platform as well. There are tools here to be able to draw your own support and resistance lines, as well as your chart patterns if that’s your style of trading. But for me, I like to just keep it clean. What I do is put my moving averages that I use so I can see the pattern without putting too much on the chart. Also, this orange line here is VWAP, so we know that volume weighted average price can have support throughout the day. This was an excellent trade, putting these two together, an excellent trade to take off of this set up. As you can see here, this came in at 11:30 this morning. And this came in right as we were in a period of consolidation right around in here, right? I would say right in the middle of this pennant.
We see that the price action, again is this orange line (VWAP), so ROKU basically bounced off of VWAP here and didn’t really break below it with any kind of volume. In my style of trading, just looking at that pennant, ROKU is basically calling up the price action. I can also see that someone is placing a big order and they’re sweeping in above the ask – 472,000 on ROKU. That’s pretty big. That’s definitely something that I want to pay attention to, and I can see that it was exceeded in one trade. That’s something that I’ve evaluated here; I’ve looked at the chart and the technical analysis look good. I can see that the big boys are placing some pretty big orders on ROKU, and it looks like they’re pretty excited as the price action continues to move up. So that’s a trade that I took, and it actually worked out pretty well for me today so far.
Real Time Profit
I can honestly say that the options flow data is something I wouldn’t be able to analyze without BlackBox, because I wouldn’t have the visibility to see what people are doing in real time. Again, ROKU was just a walk through on a simple trade I took today, and how you can use the system in real time to make some real profits. For me, this is just an example on the benefits of using BlackBox. Also, BlackBox gives you a lot of additional functionality. When I’ve taken a trade or if I’m trying to evaluate getting into a trade, I can filter the options flow and see if there are any other orders in for 165. Or if there were any other trades done on that strike, because this can work on any ticker and for any strike. I really like being able to filter down on seeing if there are multiple orders on a strike.
Also, another thing that I think is really, really valuable and that I really like is the alert stream. You can see here – and these alerts will come through the day – as they give you an alert, you can receive an audible alert, or it can just pop up on the screen visibly.
There are a lot of different alerts that are coming through the day, not just in options trading, stock alerts too. What these alerts are really saying is “here take a look at this, take a look at that.” And as you can see, we’ve had some pretty good gains on some of these today. My favorite alert is what they call a rapid-fire alert, and that is when you have multiple people continuing to hit a certain striker exploration on a certain ticker. I really love to play those because they can definitely get some good momentum behind them.
There’s definitely a lot of ways to utilize the BlackBox platform. From news, to the options flow, to the various ways that the data is broken down for you, it’s generally really easy to understand. Another good thing in BlackBox is the community of traders here. I can honestly say, for me, that the community of traders has been awesome because we’re all here to support each other and we are all there to lean on each other throughout the days and share our knowledge. So, that’s how I use the BlackBox platform and I can definitely say that it’s an invaluable tool for me. Since I’ve been with BlackBox, it’s definitely helped improve my trading!