- Swing Trading
- Account Growth
- Sustainability
- Performance
- Technical Anlaysis
- Market Insight
- Weeklys Exp Date
Performance Results
SKO_Gold_Trades.xlsx
Can You Swing Trade With Options?
We keep our swing trading with options style simple and stick to the basics of just buying calls and puts at Stock King Options.
This is one where essentially it enables the taking of medium-term advantages of overnight fluctuations of stock movement on whether the market goes up or down, that’s it.
Can you swing trade with options? Yes, swing trading with options is possible and can be highly effective.
Traders use options to capitalize on short- to medium-term price movements, leveraging strategies like buying calls or puts, covered calls, and credit spreads to manage risk and maximize profit potential.
Swing trading options enable new trades to use relatively small amounts of money and gives them an opportunity of greater potential returns while generally managing risk more effectively than if trading the underlying stock directly.
This will involve buying call or put options with strike dates that coincide with expected price movements either for a few days to a few weeks.
We typically trade weeklies, swing trading options with same week expirations, so most traders are now focused mainly on overnight movement and immediate chart patterns and analysis of market sentiment in order to come up with entry and exit points for such trades.
Moreover, the use of spreads—be it vertical spreads or iron condors—exerts even more potential toward profitability while limiting potential losses, which is quite attractive to people in harnessing volatility without risking a lot of capital at once.
This is a more advanced way of swing trading options which we do not signals in our trading room.
We keep it simple so the beginner to intermediate level type traders can join our Gold Trading Room and take advantage of our real time entry and exit swing options trading signals.
What Is The 1% Rule In Swing Trading?
The 1% rule in swing trading is a fundamental guideline emphasizing risk management; it essentially advocates that traders should not risk more than 1% of their trading capital on any single trade.
This principle becomes even more relevant when moving to swing trading options, since price movements can be volatile, and timing is everything.
What is the 1% rule in swing trading? The 1% rule in swing trading limits risk by ensuring no more than 1% of a trader’s total account balance is risked on a single trade.
This rule helps preserve capital and maintain consistent risk management across multiple trades.
By following the 1% rule, swing traders can be quite effective at protecting their investments from large losses while still providing room to catch all the potential gains of short- to medium-term market swings.
For instance, if a trader has a $10,000 account, they would risk no more than $100 on any one swing option position.
This approach not only provides discipline but also brings long-term sustainability to an often volatile nature associated with options trading—a very important consideration for anyone looking to profit in the market swings without putting their financial life at risk.
What To Look for When Swinging Options?
Swing trading options involves identifying important market conditions and technical indicators that can give way to the potential movement in price.
First is the volatility of the underlying asset: options for stocks with high volatility have a higher chance of profitability but come with increased risk as well.
What to look for when swinging options? When swinging options, focus on volatility, time decay, strike price proximity, and market trends.
Prioritize options with sufficient liquidity, favorable risk-reward ratios, and expiration dates aligned with your trade timeline to maximize potential returns while managing risk effectively.
Analyzing chart patterns such as head-and-shoulders or triangles can reveal crucial entry and exit points for trades.
Also, take note of important support and resistance levels, since these levels usually define price action in swing trading scenarios.
Look for news catalysts relevant to earnings reports or any other news that may move the underlying stock shortly after entering your trade.
Combining a comprehensive approach to fundamental analysis, such as sector performance, with technical signals can improve decision-making when choosing which options contracts to enter.
Furthermore, by looking at the implied volatility of the options themselves, one gets insight into market expectations.
Higher implied volatilities may mean higher premiums, so balancing cost against potential reward is going to be very important in devising a strategy that can work well in swing trading options frameworks.
Our Gold Trading Room Features
Swing trading options is a popular strategy among the more seasoned traders. This usually means we’re buying into a stock options position and hold overnight. One thing in common with any swing trades is that we are in a trade for at least 1 day and hold overnight as mentioned in our Stock King Options trading rooms.
- Entry alert positions are typically called out on the last 15 min of the day, we hold overnight, and we then monitor the trade the morning.
Gold Trading Room Examples
When in profits, we'll call out our first price Trim for our initial take profit.
Once we start seeing returns, we scale or trim our position, which means take profits for most of our contracts. For those who only open 1 contract, we highly recommend we take profits on the first Trim called out.
Managing the Position
These stock options entry alert positions are typically called out on the last 15 min of the day, we hold overnight, and we then monitor the trade the morning.
Note the longer we hold the position, the more the position loses value as it reaches its expiration date as it decays due to Theta.
Strategy: call out the entry signal right before end of day and sell the next morning.
Taking Profit: Take the first trim signal or set your stop loss at breakeven and let the play run! 2 different types of management styles based on how aggressive you want to be.
The main goal is to exit the trade with anything above a 20%+ gain for any signal called out in our stock options trading channel: SKO – Gold.
As the essence of the trading room is to swing trade stock options, holding them overnight is the ideal strategy. This we we can also avoid the PDT rule (Pattern Day Trader).
Stop Loss
For our stop loss, we watch specific level for the symbol which was called out. We are constantly watching the charts to signal out a close.
Once a specific level is reached, the exit signal is called out. At this point is where we completely exit the trade.
Pro-Tip: Executing the Stop Loss strategy is a bit more difficult with Robinhood as you would need to use the Stop-Limit feature.
Our recommendation to traders is to use Webull or TD Ameritrade where the Stop Loss feature is more direct.
Overview
Our Gold swing trading options room is made for overnight hold periods. This strategy allows us to take advantage of gap ups and gap down in the markets. This allows to make decisions on the position at bell open.
It’s a slower approach as far as the velocity of options trades. Typically we signal 1-2 stock option positions around 10 min before bell close.
If you fall under one of the criteria below, this is what we would consider a perfect candidate to start in our Gold Trading Room:
-Beginner or Novice to options trading
-Less trade monitoring
-Broker account over 1K+ to start
-Avoid the PDT (Pattern Day Trader) rule.
You don’t have to fulfill all of the above. It’s a good place to start if you’re new to trading stock options.
If this sounds like it’s a good fit to start swing trading stock options options, once you sign up we will get you set up in about 5 min.
Our alerts come from the Telegram app. If you have any questions, please reach out to us. You can contact us through one of the following:
-Telegram: @stockkingoptions (fastest!)
-Text Us: (305) 697-5405
-Instagram: @stockkingoptions
-Email Us: support@stockkingoptions.com
If you’re looking for something with faster returns on a daily basis, we have 2 additional options day trading room available as well. Check out some of our other rooms below.
Onboarding
If the Gold Trading Rooms seem like a good fit. Use the following link below to sign up. Once you sign up, we can get you set up within 5 min.
Just reach out to us on Telegram: @stockkingoptions (fastest option!) with your sign up email we’ll get you set up. Looking forward to hearing from you!
Featured
Stock Option Service
Gold Trading Room Access.
Trading strategy: Swing Trading
# of Signals: 1-2 Signals/Daily
Perfect for the beginner/Intermediate trader looking to take advantage of overnight swings trading stock options.
SWING TRADING OPTIONS EXAMPLE 1 - AMD CALL
AMD calls on 7/3/2024 was a great play called out in our Gold trading room. As you can see on the daily timeframe, we got into this play after a day of strength on the previous day. On the day it was signaled, we had some movement to both sides but we were left in day of indecision.
Previous price action told us we had broken to the upside. We formed a bull flag where we started to break liquidity levels. This signaled to us an entry play for the next day. As you can see below, we called out AMD calls, 7/5/2024 expiration date, $167.5 strike, and an entry of .45.
Our swing trading options strategy is always to call the plays 5 min before bell close. Please note this play it was called out at 9:56 am, when the market closed at 10 am due to the July 4th holiday.
This AMD entry was .45 which means for each contract that we purchase, it cost us $45 dollars. If you bought 10 contacts, this would cost a total of $450 dollars.
As we swing trade options in our Gold trading room, we’ve analyzed the play to gap up the next morning.
At bell open, AMD gaped up in the morning, pulled back a bit and proceeded to rip to the upside the rest of the day. If only they all could be like this.
See the price action below on July 5th as we did not trade on July 4th for the holiday.
Our first trim on this AMD swing trading options play was at .80. Once we got our first trim, we held the rest of the position and exited at 1.46 as out premium.
See the exit signals noted as the Trim and Take Profit.
This is a prime swing trading options example, as we had no drawdown on the play with a nice clean gap up with follow through.
At Trim, the swing play was 77%. At Take Profit, this play was closed out at 224%.
Got to love the power of stock options.
SWING TRADING OPTIONS EXAMPLE 2 - AAPL PUT
In this swing trading options example, we called out this AAPL Put play on 5/22/2024. We saw the rejection off of our level with a bearish engulfing candle at that same level.
This showed that the market was showing weakness at the level, therefore we called out a Put play on AAPL in our Gold trading room. See the example of the entry signal below.
Our options swing trading position was AAPL Put; 5/24/2024 Expiration Date; $190 for the strike price. We always have a reminder signals 15 min before market close to make sure our members are ready to act on the entry signal which is called out 5 min prior to market close.
In with AAPL swing options trading signal our premium entry signal was $0.65. This means that our position at the time that we bought it cost us $65 per contract.
Since we’re swing trading options and getting into them right before close, we’re looking for the AAPL market to gap down on us and we take advantage of the overnight move.
The next day at bell open, we AAPL opened a bit above our entry, so we did have some draw down. We were confident in our position as it was holding out level.
Eventually the market made the move to the downside. as we predicted. See the screenshot below.
We initally trimmed some of our position at $0.91 premium per contract on our options swing trading which was about 40%. Eventually, we closed out the rest of the position at $1.31, which was 100% gain on the position from entry. Exit stock options signals are below:
On the next day, the AAPL market had a huge move to the downside, so these contracts were worth well over 400% on gains by end of day. We did have some members who held through the entire move and had a big cash out day.
This is a perfect example of the type of swing trading options signals we call out in our Gold trading room. Not only how simple it is to understand the swing options signals, but the timing of everything which is was we do on a daily basis.
This is perfect fit for people who do not want to spend all day looking at the charts or can’t spend a lot of time looking at the charts as they have a 9 to 5 which requires most of their attention.
Only minimal time is required on screentime or you can only act on the signals which are given. Also, it’s a perfect for the beginner swing options trader as it’s a slow paced trading room and simple to understand stock options.
If you’d like to start swing trading with options in our Gold trading room, use the following link to sign up: stockkingoptions.com/gold-membership.
Understanding Swing Trading Options
Swing trading options is a way how beginners get into trading stock options as it is a straight forward type trading that is slower paced. However, it requires at minimum a basic understanding of the underlying principles and strategies.
In this section, we will look into some of the following aspects; understanding strategies, risk management, and avoiding the PDT rule.
As swing trading options is slower placed, we can take the time to fully understand what’s happening in the markets without huge moves occuring.
Understanding Swing Trading Options Strategies
In trading, knowing different strategies is super important for success, especially when swing trading options.
When you’re swing trading options within the stock market, having a good strategy can help you lower risks as you look for high quality setups.
One popular strategy is called, the break and retest strategy. It’s all about spotting levels on the higher time frames, such as the 1H, 4H, and the Daily timeframes.
People who use this strategy look at technical analysis such as like moving averages, support and resistance levels, and candlestick price action patterns to know when to buy or sell.
Managing risk is really important when implementing a swing trading options strategy. It means figuring out levels and having a stop loss set in case a trade goes against your trading plan.
The PDT rule was made to protect small investors who might get carried away with frequent day trading.
If you make four or more day trades in five days, you’re called a Pattern Day Trader and need at least $25,000 in your account. This is when swing trading options comes into play to avoid the PDT rule.
To avoid being a Pattern Day Trader, you can try swing trade options instead of day trading options. Swing trading options means holding onto positions at minumum overnight, or you can also hold over a couple of days as well.
Either way, holding overnight is now considered a swing trade which is a work around avoiding the PDT rule.
Understanding different strategies and managing risks is super important for doing well in the stock market, especially when trading stock options and their very volatile.
Slower Paced Style of Swing Trading Options
Trading stock options in a slow and steady pace fits right in with swing trading options. This method is good for beginners or people who don’t want to take big risks.
Instead of making lots of trades quickly, you hold onto your positions for at minimum overnight to a few days. This can help you grow your money steadily and avoid big losses.
The key here is to be patient. Instead of rushing into trades, take your time to pick the right stock options with the desired expiration date. Just know that the further out the expiration date, the more the premium for the stock option position.
One good thing about this method is that it works well with the PDT rule.
This rule says you can only make three day trades in five days if you have less than $25,000 in your account. By swing trading and holding positions overnight, you can avoid this rule altogether.
Another advantage of swing trading since you’re looking at higher time frames by design, you catch a majority of the bigger move resulting in larger profits.
But remember, even though this method is “safer”, there’s still some risk involved. You could still lose money if a trade does not go your way.
The key is to follow your swing trading options plan.
To do this method right, you need to understand how to analyze stocks and price action and use techincal and fundamental analysis to find good opportunities.
Swing trading options is a slower-paced style of trading stock options which is made for the beginner trading.
By being patient, using analysis tools, and managing risks, you can do well implementing a swing trading options style of trading to avoiding the PDT rule.
Avoiding The PDT Rule by Swing Trading Options
The Pattern Day Trader (PDT) rule is a rule that stops people from making too many day trades if they don’t have enough money or experience.
It says that if you make four or more day trades in five days, you need to have at least $25,000 in your account.
This rule is there to protect new traders from losing too much money too quickly.
But it can be a problem for people who are just starting out or don’t have enough money to follow the rule.
Luckily, there are ways to avoid being labeled as a pattern day trader while still trading in the stock market by swing trading stock options.
Swing traders hold onto their positions overnight, so they don’t count as day trades. Allows us to avoid the PDT rule.
Another way is to use multiple brokerage accounts. If you spread your trades across different accounts, you won’t trigger the PDT rule on any single one.
But remember, this might cost you more in fees and also a bit more confusing managing your positions.
Brokers offer cash accounts that don’t fall under the PDT rule. These accounts don’t let you borrow money to trade, but they also don’t require you to have $25,000 in your account.
This is the typical go to for new traders, but one thing you should know is that funds will be on hold as they settle, so they cannot be used until they do settle.
Different brokers offer difference fund settling days. TD Ameritrade settles the funds overnight which is ideal, but they do have $0.65 per options contracts in fees.
While the PDT rule might seem like a hassle, there are ways to work around it. Knowing about these tactics can help you trade avoid the PDT rule.ioio
- Brokers offer cash accounts that don't fall under the PDT rule. These accounts don't let you borrow money to trade, but they also don't require you to have $25,000 in your account.
