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Scanner to Find Explosive Gamma Bar™ Option Trades
The 3xOptions Daily Dashboard is a powerful option trade scanning tool to not only identify what stock options are likely to experience explosive price moves, but it also shows you where to enter the trades, place risk stops, and where to exit your winners!
The Explosive Gamma Bar™ Pattern
One of the best chart patterns for explosive Call and Put option trades is the Gamma Bars™ pattern. Gamma Bars™ are high energy daily or weekly price bars that offer exceptional profit potential for option traders.
Essentially, there are four types of Gamma Bars based on the magnitude of the price move between the open and close of the price bar. The four types of Gamma Bars™ are as follows (color keyed to match the chart above):
B = 0.5 Std Dev Price Move
B1 = 1 Std Dev Price Move
B2 = 2 Std Dev Price Move
B3 = 3 Std Dev Price Move
Stocks tend to have a disproportionate number of big price moves… big daily and weekly Gamma Bars from a statistical perspective. In the world of statistics, this type of bell curve distribution contains what they call “Fat Tails.” This means that a disproportionate number of big price moves happen when compared to a normal bell curve.
For example, when dealing with a normal probability distribution, we would expect very few big “3 Standard Deviation” (3 Std Dev) price moves on a chart. In fact, these should be extreme rare events. However, if you notice on the chart of Gilead Sciences below, we have five huge 3 Standard Deviation Gamma Bars™. These magenta B3 Type Gamma Bars™ in the chart below tend to be huge winners when trading call or put options. From a statistics standpoint, having this many huge bars is very unusual.
The Gamma Bar™ pattern is one of the absolute best patter to trade for option traders. Why? Because we can make huge gains buying calls or puts in a very short period of time.
Far from the biggest Gamma Bar was the last B1 Type Gamma Bar in the chart of General Electric Co. (GE) below. The GE 6.5 Puts exploded up 420% during this expiration Friday Gamma Bar trade example.
Even though the last Gamma Bar™ on the GE chart above is only a Type B1 Gamma Bar™, we could have made 420% buying the GE 6.5 Puts on expiration Friday! Making 420% profits in a single day is a huge return.
Gamma Bars are great patterns to target when trading options because you can make big profits within a very short period of time (within a day or week). Gamma Bars and options combine to form the perfect strategy! Let’s take a look at a number of Gamma Bars with corresponding explosive options.
Amarin Corp. (AMRN) Daily Gamma Bar™ Chart
Believe it or not, during the Gamma Bar the AMRN 7 Calls exploded in value by 1,175%! This was a case where all the stars aligned just right. The open of the daily session was close to the strike price, implied volatility was low, and this was a trade that unfolded on expiration Friday. This example showcases just how much options can jump in value even for a B1 Gamma Bar!
The next Gamma Bar example unfolded as a bearish swing trading setup in UVXY. The Gamma Bar was only a B1 Type, but implied volatility was low and the trade also took place on expiration Friday.
ProShs Ultra VIX Short-Term (UVXY) Daily Gamma Bar Chart
Even though this Gamma Bar was far from the biggest Gamma Bar on this chart, the UVXY 52 Puts still increased by 100% within a single day. Can you imagine how profitable some of the B2 and B3 Type Gamma Bars earlier in the chart would have been? The indicator on the bottom of this chart is a customized indicator called TOP IV Percentile. This displays a relative Implied Volatility (IV) for UVXY. But even with high Implied Volatility (IV), big Gamma Bars can still be highly profitable.
Note: The color red on the chart as the background for the UVXY 52 Puts and the red trade arrow simply denote a trade using put options.
In the chart of Intel Corp. (INTC) below, you can see a nice B1 Type Gamma Bar that resulted in the INTC 56 Calls exploding by 230%!
Intel Corp. (INTC) Daily Gamma Bar Chart
You can see that there are a large number of Gamma Bars in the daily chart of Intel Corp. (INTC) above. I would bet that the magenta B3 Type Gamma Bar in the chart above would had been a home run trade using call options. And the large number of green B2 Type Gamma Bars are typically also highly profitable when trading options.
This is another great example of an explosive expiration Friday Gamma Bar option trade. Las Vegas Sands Corp. (LVS) experienced a B1 Type Gamma Bar on the final expiration day of the LVS 46 Put option contract. And because of this, the LVS 46 Puts exploded by 281% in a single day.
Las Vegas Sands Corp. (LVS) Daily Gamma Bar Chart
When even minor Gamma Bars unfold at lower levels of Implied Volatility (IV), there is often excellent potential to score big profits trading options. Now, these examples are simple here to show you the opportunity. Later in this report, we will cover how to know to buy calls or puts with Gamma Bar trades and, how to determine the strike price and expiration date for option contracts.
Call Options are financial contracts that give the option buyer the right (not obligation) to buy a stock at a defined price (strike price) before a certain date (expiration date). You buy a call option if you think the price of a stock is going higher.
The diagram above is the At Expiration Diagram for a Call Option. The thing to remember is that your maximum loss if you are wrong with the direction of a trade is equal to the premium you pay for the option. In theory, if you are right about the direction of an option, then you can make unlimited profits (or at least make a lot more than you risk).
Options are derivative contracts. Each option trades for a specific stock, like Apple (AAPL) or Google (GOOG). Stocks with higher market caps are primarily the stocks that have tradable options.
Put Options are financial contracts that give the option buyer the right (not obligation) to sell a stock at a defined price (strike price) before a certain date (expiration date). You buy a put option if you think the price of a stock is going lower.
The diagram above is the At Expiration Diagram for a Put Option. The thing to remember is that your maximum loss if you are wrong with the direction of a trade is equal to the premium you pay for the option. In theory, if you are right about the direction of an option, then you can make much larger profits than you risk.
We Remove the Guess Work!
Deciding what option contracts to trade can be challenging. After extensive research, we’ve identified options that we believe have the best chances of making explosive profits when price moves go your way.
We remove the gray area by showing you the exact option(s) to buy for every trade alert type. For each 3XOption Daily Dashboard option trade, we tell you the exact Stock Symbol, Strike Price, Expiration Date, Entry level and Risk Stop level, and we also provide Two Profit Targets for every option trade listed. If you choose not to exit at a profit target during the day or week timeframe, you will always sell (exit) your option position at the close of the day or the close of the week (Friday at the close).
At 3xOptions.com, we have created powerful scanners to find the best Gamma Bars trading opportunities for the 200 optionable stocks we track. We generally track stocks with option open interest above 100,000 contracts, to ensure sufficient liquidity when we place our trades. Thinly traded options are not good because of the slippage we experience when entering and exiting our options.
Note in the 3xOptions Daily Dashboard scanner above that Amazon (AMZN) was one of our trade picks using our swing trading setup patterns. In this case, the scanner is telling us that there is a potential Gamma Bars trading opportunity for call options. The Alert type is a Swing pattern, the option type is Call, and our custom Implied Volatility is at 51.86%, which is acceptable.
The great thing about the scanner is that is tells us the exact call or put options to buy. In this case, if prices rise above the Enter level at 2347.19, we are to buy the AMZN 2345 Calls with an expiration date of May 1, 2020. Profit Target 1 (PT1) is positioned at 2368.67 and Profit Target 2 (PT2) is positioned at 2385.85 in the table above. And the risk Stop is positioned at 2326.57, where we exit our call option if prices go against our position.
The chart below shows the daily Amazon (AMZN) Gamma Bars analysis. Noted that Amazon did end up having a minor Gamma Bar in the upside direction with a B Type Gamma Bar, which is the weakest Gamma Bar.
Using the alert on the previous page to buy AMZN Calls if prices breakout above the Buy Level, the chart below illustrates the trade levels from the 3xOptions Daily Dashboard scanner along with the profits.
Amazon Corp. (AMZN) Entry Levels from the 3xOptions Daily Dashboard
Even for the smallest B Type Gamma Bar for the Amazon trade example on the previous page, Profit Target 1 made an estimated 20.4% and Profit Target 2 made an estimated 34.9%. The close of the session was a little above Profit Target 1, so it should be similar in terms of profits.
Note: Commission and slippage were not considered in any of the examples in this report. We always recommend working orders for options with wider Bid/Ask spreads.
Scanner to Find Explosive Options
We built one of the most powerful option trade scanners in the industry designed for the sole purpose of finding explosive options. For the first time ever, we have incorporated four of our most powerful market analysis tools to find the best explosive daily and weekly option trades. As part of this advanced scanner, we utilize the following market analytics to scan for explosive options in the markets:
- Gamma Bars
- Candlesticks Patterns
- Swing Trading Patterns
- Gap Openings
The Power of the 3xOptions Daily Dashboard Scanner
Is it possible that one of the most powerful strategies to trade options may actual be one of the simplest ways to trade options? Yes! We believe that our Scanner could be one of the most powerful and effective ways to trade options on the market, and here’s why…
① We show you Where to Enter the Option
② We show you Where to place your Risk Stop
③ We provide Two Profit Targets or Exit on Close
With every trade alert, we show you the price level of the stock where you enter the Call or Put Option, we show you where to place you Stop, and we give you Two Profit Targets where you can exit with winning trades during the day or week. All trades must be exited by the close of the day or week on Friday at the close, however.
Risk Disclaimer: Options trading can make large profits but also carry a high level of risk. Be sure to read and understand our risk disclaimer at the bottom of this page along with researching the risks associated with trading options in general.
Simple Options Trade Alerts!
Believe it or not, 3xOptions Daily Dashboard option trades are very easy to trade. For each Option Trade Alert Type, you buy the Call or Put Option when prices hit one of the target entry levels based on the underlying stock. In addition, we also provide Two Profit Targets that you can use to exit with profits during the day or week, giving you three potential exit logics for each Call Option or Put Option Trade Alert.
A chart pattern setup we monitor when we look for Gamma Bar™ trading opportunities is opeing gap. Opening gaps are often great for finding good Gamma Bar trades.
You can see in the above 3xOptions Daily Dashboard table that the Gap setups give us the opportunity to target both up and down Gamma Bars using calls and puts. Depending the when a stock trades, we have an opportunity to potentially profit from up moves with call options and down moves with put options trading at the BETT Price Levels.
As it turned out, Halliburton Co. (HAL) experiened an opening gap and was selected as our pick for the day. Halliburton when on to have a nice bullish B1 Type Gamme Bar during the daily session, where we would have bought call options.
Halliburton Co. (HAL) Daily Gamma Bars™ Chart
We can see in the chart below that taking the buy call signal for Halliburton we would have experienced nice profits. The close of the session ended up being the biggest winning exit with this trade example at +150%!
Aggressive Profit Opportunity with Defined Risk
Make no mistake, we are shooting for aggressive account growth. Now, before we continue, you must understand that the 3xOptions Daily Dashboard alerts are risky by design. We are targeting explosive options with this powerful scanner and traders must be willing to assume high levels of risk. So be sure you understand the risks involved with this program and the risks involved in trading options in general before considering this program.
It is important to understand that we expect to have both winning Trade Alerts and Losing Trade Alerts. Our goal is to identify more or larger winning trade alerts than losing trade alerts over time, which is how most professional options traders approach trading options.
Our Trading Edge
Professional traders will tell you that you simply must have a trading edge if you expect to outperform the broad market. A trading edge, in simply terms, is typically a technology advantage or a skill advantage that most traders don’t possess. At 3xOptions, we believe that we have both! Gaining a trading edge is not easy and there are no short cuts. It has taken us over 25 years to realize the trading edge that we now enjoy and that we now share with you at 3xOptions.com.
Now, as with any trading strategy, you will have losing Trade Alerts at times. However, although we cannot guarantee winning Trade Alerts every time, we are confident that we can effectively identify explosive option alerts in our large group of optionable stocks and ETFs that we track. We believe that we can beat the markets by leveraging the power of probabilities. This means that, in our opinion, our winners as a whole should exceed our losers over time.
Although our goal is for you to make a lot of money trading options, it is important to note that there is a risk of loss when trading options and that past performance is not necessarily indicative of future results. Be sure to take the time to read our Risk Disclosure and understand the risks associated with trading options.
Hedge Fund Caliber Research to Help You
Each day our powerful scanner works hard to analyze our list of optionable stocks in order to find the best potential Option Trade Alerts so you don’t have to. Using our hedge fund stock market scanners and our hedge fund market analysis tools, we focus on finding the most explosive Option Trade Alerts.
Then, after crunching the numbers and doing our research, we work to identify the top Option Trade Alerts. Once our highest potential Trade Alerts (in our opinion) have been identified, we post the 3xOptions Daily Dashboard in the members area (several minutes after the stock market opens each day). Now you can benefit from our powerful hedge fund research!
Putting the Odds in Your Favor
Professional trader will tell you that you have to do the following three things to make money consistently in the markets:
① Find a proven trading strategy
② Apply your strategy consistently over time
③ Apply good money management principles
Although no strategy in the world can guarantee that you will make a million dollars, we believe that the 3xOptions Daily Dashboard Alerts put you in a position to make consistent profits in trading options. And, by leveraging our hedge fund caliber trading scanners and market analysis tools, you can use our research and technology to potentially put the odds in your favor in a big way!
Trading Best Practices
In order to realize our goals with making aggressive returns with the 3xOptions Daily Dashboard Alerts, you must understand and embrace the following keys to success:
Realistic Expectations – In this case, you need to understand that 3xOptions Alerts are risky. Many of the Trade Alerts will lose 10%, 20%, or even 50% or more of the option premium, so expect this and don’t be frustrated by this. Why do we say this? Because as professional traders we know that every trading strategy has losing trades. However, as we know we will have losing trades, we also expect (but cannot guarantee) that we will have a large number of big winners. Expect extreme account volatility. This means that you could lose half of your account value and then double your original account value if everything goes in our direction. We will work to create a smoother ride than this, but you need to be prepared to anything. The key to success here is to have more or larger winners than we have losers. We are up for the challenge. But you must have realistic expectations. This will be a volatile ride! This strategy is not for the faint of heart nor is it for the risk averse! We will never conquer the markets; we just hope to beat the markets over time through our powerful trading edge, extreme leverage, and winning probabilities.
Control Your Emotions – Don’t get too excited with winning trades and don’t get frustrated or depressed with losing trades. Losing trades are a cost of doing business in the trading profession and wining trade profits can reverse and give back profits at any moment. Try to avoid extreme emotional highs and lows and stay focused on the core disciplines listed in this section that can contribute to overall success. Emotions are bad in the trading profession and therefore must be kept in check.
Trading Edge – This involves using our powerful hedge fund caliber market analysis tools and scanners, which involve waiting patiently for those very special Trade Alert option trading opportunities. Out specific goal, among other things, is to identify potential Explosive Clusters in a number of stocks that we track. And, once we believe we have identified these special trading opportunities, and only then, do we post them to our 3xOptions Daily Dashboard. Our trading edge is being able to potentially identify daily and weekly explosive option trades before they occur. This means that we must also know when not to trade and when to wait patiently, which will be much of the time. Our goal is to find the special OptionTrade Alert option trading opportunities through superior trading tools and technology (our opinion).
Risk Management – In order for any trader to succeed, he or she must manage per trade risk. With whatever level of per trade risk you determine is appropriate for your account, you must work to make sure the each trade risks approximately the same amount over time. Ideally, we recommend risking 1% of overall account value or less on each Gamma Trade Alert. The reason for this is that at the end of the day, nobody really knows for sure which trades will be the winners and which trades will be the losers. If you are serious about trading, you must also be serious about managing per trade risk. Only by doing this can you potentially beat the markets through probabilities.
Account Leverage Increases – An important consideration is when to increase per trade risk (or account leverage) for a growing account. Most traders do this way too quickly. We recommend doing this at the end of each year at the most, and this assumes that you have experienced strong account growth during the previous year. Otherwise, we do not recommend increasing per trade risk (account leverage). Patience and discipline are needed in this area to achieve aggressive long-term account growth!
Disciplined and Consistent Approach – Successful trading is not easy. You must define what you are willing to risk on the front end and you must be willing to keep going through difficult times when you experience several losing trades in a row. New traders tend to be overly optimistic. If you are ready for difficult and challenging periods (difficult losing periods with deep account losses), then you will be able to easily endure winning periods where everything goes your way. If you can’t get through the difficult periods, then you may not make it to the winning periods (assuming a profitable trading outcome over time).
Learn About Options – You need to take the time to understand options as a strategic and leveraged financial instrument. Trading options is risky, but you can also make a ton of money trading options if you know what you are doing and if you have a trading edge. At 3xOptions, we are primarily focusing on long Call strategies and long Put strategies, and possibly some vertical Call and Put debit spreads as well. We are focusing on defined risk strategies that offer exceptional profit potential if and when they hit.
Check Our Website after the Stock Market Opens – If you choose to follow the 3xOptions Daily Dashboard Alerts, and if you understand and accept the high level of risk associated with these Trade Alerts, then you need to be sure to pay attention to when we post our Dashboard shortly after the open each trading day. This is because all Trade Alerts are time sensitive. You don’t have to sit in front of your computer all day and you don’t have to take all of the Trade Alerts we post (or any of them for that matter). However, if we are looking to beat the markets over time with probabilities, then we believe it is to your advantage to consider several trader alerts – assuming you can take accept the risks. Also, different Trade Alerts for any given day or week can be highly correlated, so this fact can potentially impact your risk management and which Trade Alerts you choose to take.
Work Your Option Orders at Times – Certain options can have wide Bid/Ask spreads. Make sure you understand what this means. We recommend that you carefully monitor each option market and we recommend that you study the Bid/Ask spread before you place any trades on Monday Morning or on Friday at the close of the week. Consider using limit orders and consider tracking your orders to see if an order limit price was accepted – or you may need to modify your limit price order in some cases to get in some option trades. Sometime you need to work fast. If you don’t monitor your Bid/Ask spreads and your orders, you can be sure that option market makers will rip you off over time. This can dramatically eat into your profits over time (assuming we are successful).
Exiting Trades – Exiting a number of losing trades will most likely involve risking 50% to 100% in the 3xOptions Daily Dashboard Trade Alerts program. This is a risk you must accept with this program. However, when exiting losing trades with the goal of recouping residual time value, then the goal is to work exit orders between the Bid/Ask prices. In general, if dealing with a wide Bid/Ask spread, you will want to select a price between the midpoint of the Bid/Ask spread and the Bid price when exiting a long Put or long Call position. This process involves part art and part science. When dealing with winning trades, you must be cautious when encountering wide Bid/Ask spreads. If your option is In The Money (ITM), you want to make sure that you at least get a price equal to the intrinsic value of the option when you exit (the intrinsic value is the absolute value of the difference between the current option price level of the underlying and the strike price). Be careful as option market makers are often looking to take advantage of unsuspecting options traders. In some cases you may consider exercising your option trades and then selling the stock position in the more liquid underlying market. Exiting both winning and losing option trades involves a skill that you will want to work to develop over time, or you may be taken advantage of. It’s not difficult; it just requires some study and attention to detail.
Give it Some Time – If you are interested in following the 3xOptions Daily Dashboard Trade Alerts program, you need to think in terms of probabilities. One month of following this programs is not enough in our opinion, because these strategies are designed to take advantage of long-term trading probabilities. The greater the number of Trade Alerts, the greater the chances for success over time (in our opinion, assuming that we are successful longer-term). Again, we cannot guarantee success or that you will make a million dollars, nor can anyone. The bottom line is that you need a larger sample size to benefit from 3xOptions Trade Alerts assuming that we are ultimately effective in identifying good trades. You may not want to quit trading right when things are about to turn around and get exciting. Many new traders do this. But, you must also recognize that no strategy in the world can guarantee that a turnaround is inevitable during challenging times.
Welcome to the New and Exciting Way to Trade Daily and Weekly Options with the 3xOptions Daily Dashboard Scanner!
We believe that you will love the 3xOptions Daily Dashboard Sanner Alerts service. Please don’t hesitate to contact us a Support@3XOptions.com with any questions that you might have. Welcome to the new and exciting way to trade options!
IMPORTANT NOTICE! No representation is being made that the use of this strategy or any system or trading methodology will generate profits. Past performance is not necessarily indicative of future results. There is substantial risk of loss associated with trading securities and options on equities. Only risk capital should be used to trade. Trading securities is not suitable for everyone. Disclaimer: Futures, Options, and Currency trading all have large potential rewards, but they also have large potential risk. You must be aware of the risks and be willing to accept them in order to invest in these markets. Don’t trade with money you can’t afford to lose. This website is neither a solicitation nor an offer to Buy/Sell futures, options, or currencies. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results.