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Option Millionaires was started in February 2008 to provide traders with information about option trading. Led by three career option traders, whose pseudonyms are JimmyBob, UraniumPintoBeans, and Vantillian, they started one of the most popular option trading communities on the web. Now, Option... More
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  • Crude Oil Momentum Warns Of Coming Upward Reversal (Video)

    By Chris Diodato -

    Today's price action in oil was not surprising. It was a 61.8% retracement of the past ten day's up move. That's great, but does it continue lower, or start a new up trend? As I watch the internals, momentum is beginning to show that a bullish reversal may be in the works. Will there actually be peace in the Middle East come a month from today? Take a look at this YouTube video (clickable) to see the analysis on my computer screen.

    Happy trading!

    ~Chris Diodato

    Disclosure: I am long XLE.

    Nov 20 4:41 PM | Link | Comment!
  • Monday Morning Outlook – Bullish Candles, New Support Levels, Potential Bottom Targets (Video)

    By Christopher Diodato

    • August 8, 2011
    • May 17, 2012
    • November 15, 2012

    What's in common with these dates? These are all of the dates during the past two years that the market has reached the formal definition of "oversold" as explained by J. Welles Wilder. That is, the market has crossed below the "30″ level on the Relative Strength Index. In the past four years, shortly after the market reaches this point, the market had made a lower, panic low, then reversed back up. Especially with the bullish hammer formation we saw on Friday, I believe that a market bottom may be in the near future. The hammer occurred on very high volume especially in inflationary issues, such as energy stocks. Therefore, I would not be surprised if energy stocks emerged as a market leader in the next rally.

    (click to enlarge)

    Check out the video here for the RSI and candlestick analysis. Also included (in the above picture too) are the new support levels for the Dow Jones Industrial Average.

    Happy trading!

    ~Chris Diodato

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Nov 18 9:05 PM | Link | Comment!
  • EOG Resources - Energy Outperformer Ready To Rally 35% In Long-Term (Video)

    ​By Chris Diodato

    "A stock is never too high to go higher, nor too low to go lower." That's a quote from one of my favorite books, ​Reminiscences of a Stock Operator, ​ as the main character was explaining his reasoning for buying stocks as they reach new highs. This will be one of those "buy high, sell higher" type of trades.

    EOG resources has been a market leader in the energy sector as of late. Below is a ratio chart of the energy sector ETF, (NYSEARCA:XLE), divided by price of (NYSE:EOG). These "ratio charts" are used for comparing two stocks, and give an easy to read visual representation of which stock is outperforming.

    (click to enlarge)

    As you can see, the line is clearly declining, which means that EOG is outperforming. This trend actually started in October of 2011, when EOG mustered enough strength to become a market leader.

    So what's the trade Chris? Take a look at this video to find out! Included are more technical signals, the risk management plan, and the target!

    Happy trading!

    ~Chris Diodato

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in EOG over the next 72 hours.

    Nov 10 8:41 PM | Link | Comment!
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