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No trade this week - the risk/reward was just too high.
Several short-term extremes hit the market, but a few of the proprietary indicators I follow did not confirm, so a trade was not established.
Patience once again prevailed because if a trade had been established it would have certainly been a losing endeavor as the market trended lower throughout the week.
As I always state, I would rather sit patiently on the sidelines for a better set-up to come my way. This is how to successfully play the options market or any market for that matter. Any trader with staying power will quickly tell you that patience is imperative when trading, particularly when trading options.
My true focus and the focus of my options strategy is to find extremes in the market. Lately the major benchmarks and the sectors I follow just want to sit in a neutral state. That is fine, extremes will hit the market as they always do and I will be waiting patiently to jump on those opportunities when the arise.
Remember, patience is the key for long-term success in options trading. I can't emphasize this enough.
The High-Probability, Mean-Reversion strategy is now up 40.2% since it was initiated seven months ago with a win ratio of 93.3%. The strategy advanced 7.2% for the month May.
Obviously I am pleased with the win ratio (93.3%) since I initiated the High-Probability, Mean-Reversion strategy, but I am a realist. I realize there is no holy grail in trading.
(From last week's issue)
One thing that I do know for certain is that I have a unique, concrete, and most important, a profitable options trading strategy that makes the world of sense to me and I trade it to make money over the long-term.
Furthermore, I realize that the less I trade, the better my strategy will perform over the long run: and the long run is what matters. Hopefully, I can continue my winning ways and extend the gains going forward. Remember, this is a marathon and not a sprint.
The key to my strategy is patience. Waiting for the appropriate scenario to recommend a trade with a high probability of success is what makes my strategy a success.
Opportunities are made up easier than losses. If you let a few pass you by don't dwell on what could have been. There will always be more opportunities around the corner. Again, this a marathon not a sprint.
Check out the results here: High-Probability, Mean-Reversion strategy
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