Options Study Lesson: In the Money & Out of the Money Options

Traders always ask me what's the difference between an in the money option and out of the money option? In options trading, the difference between "in the money" and "out of the money" is a matter of the option strike price relative to the market value of the underlying stock. An in the money option is one with a strike price that has already been surpassed by the current stock price. The premium is the most expensive here and has the most risk of being called away. Look at the following chart in relation to covered call writing. An out of the money option is one that has a strike price that the underlying security has yet to reach. The premium is the least expensive here and has the least r

MOJO Day Trading Technical Analysis: Moving Averages

Most traders use moving averages when studying chart patters. A moving average is the average price of a security over a set amount of time. The three most common types of moving averages are simple, linear and exponential. Simple Moving Average (SMA) This is the most common method used to calculate the moving averages. It simply takes the sum of all of the past closing prices over the time period and divides the result by the number of prices used in the calculation. For example, in a 10-day moving average, the last 10 closing prices are added together and then divided by 10. Linear Weighted Average This moving average is the least common and is used to address the problem of the equal

Survival Mode

How are you surviving in this market? As you can see, the DOW is getting absolutely crushed! Needless to say, many traders are losing their shirts and busting their accounts. Any rookie traders trying to enter this market without the proper education, tools, and resources is sure to lose. So, the question remains, how are you surviving? Are you turning a profit? Are you losing? Are you breaking even? Chances are, if you are not trading in the MOJO Day Trading Room, you are losing. So, what is your hedge? Personally, my hedge, along with the MOJO Team’s, is $UVXY and Gold. This has allowed us to offset any potential losses and maintain our profitable positions. If you are trading indepe

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