Trade Options Online: Set Your Plan

In this Options Trading Tutorial, let’s explore the importance of the correct methodology when learning how to Trade Options online.

A consistent proven strategy is the foundation of feeling confident about the outcome of a trade.

It eliminates the emotions associated with either the fear of jumping in the trade or the exuberance in the hope of easy money.

Trade Options Online: What is Your Methodology?

The idea of learning how to trade Options may appear strange or new to some.

This is due to the apparent myth that money just flows in Wall Street and anybody can come and make a name for themselves.

Therefore, it is not evident to come to the realization that before making it big in Options trading, one must learn to master a wide range of competencies.

One such competency is the ability to define method by which you, the trader will consistently pull money away from the movements of the market.

We should think of a methodology as a business plan. After all, it is exactly that and as in any successful business, there must be a solid plan.

For example, all the successful companies we know out there have decided one day to hone in on a specific niche.

Apple (AAPL) does not sell natural gas just like Cheniere Energy (LNG) does not export manufacture phones.

Similarly, in our vast market with 10 sectors and over 200 industries, as a starting point of defining a strategy, one could decide to focus on a specific set of industries.

Below is the 10 sectors of the US market with the Top 20 industries (about 10% of total) ranked by market Capitalization.

In the Trade Options Online tutorial, illustrative visual is showing US 10 sectors and their 3-month performance

Table showing Top 20 US traded companies ranked by their market Capitalization in Trade Options Online article

Such a strategy could be good if we were considering long term investment such as building a long term portfolio.

When it comes to learning how to trade Options, the methodology or strategy (we will use these two terms interchangeably throughout this blog) will on small to medium time frames.


Trade Options Online: What to Do and Not to do ?


In our context, we aim to trade options online on a daily basis doing scalping and swing trades.

In scalping, we hold the position for a few hours or less. For a swing trade, we can hold the position for a few days.

Such strategies require a set of triggers or signals by which we will have a high degree of confidence that the trade will be profitable.

Typically, we accomplish this through technical analysis.

It is the science or art (the jury is still out) of observing price movement through candlesticks and determining the short term future price.

I am fully aware as I am presenting this concept of the divide even among traders of the merit of technical analysis.

Nevertheless, I am coming forward with the observation and the data to back up such observation.

Later on, I will submit here a way to combine a few successful strategies out there today.


Time To Test Your Methodology


In the world of technical Analysis, there are as many technical indicators  as traders. Maybe not.

I am exaggerating a bit but my point is that anyone can come up with a presumed technical indicator they believe provide them an edge.

I am providing a list of tools  needed for technical analysis on this section.

Yes, in order to trade Options online with consistency as we defined in a previous discussion, we need an edge and such edge is acquired by thorough validation of the methodology or system.

Let me amuse you for awhile. What if I suggest to you that one can make money trading Options by trading only on certain days of the week.

Just focusing in on a set of stocks known as your watch list.

This is a list of stocks a trader has monitored and gathered significant understanding on their movements, supports, resistances and even seasonality.

Yes, there is seasonality in the market. We will devote a full exchange on this topic in the upcoming weeks.

For now, let’s focus on the fact that ultimately, a trader will have to generate a Watch list of stocks, this watch list is dynamic in the sense that stocks can move in an out of it.


Defining And Refining Your Watch List

You see there is this notion in the market called sectors rotation or industries rotation within the sectors.

This is when we observe money flow to a group of stocks that are usually called the darling of Wall street.

Such stocks will be the last ones to fall when the overall market goes through correction.

With over 200 industries as described above, there are about 7800 or so stocks available to trade. Out of which, about 4000 offer Options we can trade.

Let’s further narrow it down by selecting only those with over 1 million shares daily volume. This leaves us with about 1300 stocks.

These could be a good set to use in a large back test scenario.  I will further suggest filtering the list down by selecting only stocks price above $25 – $30 range.

We might miss a few good ones but no big deal. By now, our list should be around 700 stocks which is still too many.

But at least this give us a good idea on how to go about creating a useful Watch List.


The Birth of the IB Triggers Report


In an earlier chapter, we established that our Personality Type dictates our assessments and reactions to the market movements.

The same applies to the adoption of a methodology. Hence, no one can determine that their strategy is the best one.

Each strategy will have its own merit to the eyes of its trader.

As long as such trader is able to be content with the performance of their strategy.

For me, the breakthrough of defining my methodology came on a hot summer day in 2017.

After stumbling on a technical paper that was going to change my life from that point forward.

We shall unveil the full meanders of what make the IB report in the next chapter.

Should you be eager to wait until then, I shall leave you with this.

What do you think IB stands for in IB Report ? (Hint: Technical Analysis)



I developed a Methodology in the Summer of 2017 that will lead to a Subscription Alerts Service.

This is supported through a Discord Channel, a Daily Stock Market Analysis Live on our YouTube Channel.

Maybe you would like to take a look and share your comments with us.





16 thoughts on “Trade Options Online: Set Your Plan”

  1. I do not do so much trading options online but I really liked your post here and I think that people who are into this really need to read this because of your show of wisdom on the subject matter. I have a friend who is into this and I think she’ll like your post. I would like to know if the potential of making money trading online is great and if you have anything for beginners like me.

    • Thank you Henderson,

      The goal of this blog is exactly to help beginners like yourself : This is a series of posts we started here: – this article is devoted to newcomers as 

      we understand the topic can be intimidating at first.
      An upcoming post will reveal the numerous opportunities that the market offers to those with the skills to exploit them.

      In the long run, our aim is to take brand new traders and help them apply these steps to become Successful Options traders.

      Hope this helps.

  2. What an amazing path of information – and challenges too! Very interesting to follow your methodology – and consider the possible different results in data you are prepared to share – (and to your question what IB may mean ….International Baccalaureate?)

    • Hello Sandra,

      I appreciate the encouraging and kind words.
      About IB, I give you an “A” for your effort 🙂
      We shall reveal the IB Report here in an upcoming discussion.

  3. As I look over all this information, i wonder if i’m even qualified to even voice my opinion on this subject. Stocks and trading I understand a little about. These buyers, sellers and traders on Wall Street really know their craft as to how to make money. Just like anything else, there’s a method to everything. Do you think there should be a specialized method regarding offline trading as well? I never knew the specifics and options regarding trading, but the series of methods offered must be working.

    • Hello RJ,

      The truth is that those we see as Master in any area today certainly started as beginners at some point.

      May I ask what you consider Offline trading please ?

  4. I have heard about Options Trading before, but I think it is very difficult, and it is something that rich people go to play. Your article is a very detailed introduction to what is Options Trading and some considerations. But I am not sure if I can really make money. Maybe I should try it.

    • Hi there Jax,

      Before considering making money, the best path is to 

      get some solid education on options trading.

      That is the Purpose  of these free online tutorials.

      Thank you. 

  5. I heard about trading options online but I never put it into practice. You made an excellent tutorial.
    I work in the oil industry and I never knew that it has such a high market cap and it is in the 3rd place. I would like to start putting this methodology presented by you.
    Do you recommend an offline way or training for beginners without the risk of losing?

    Thank you.

    • Hello my friend,

      Glad to read that you enjoyed the article.

      Yes the best way for beginners as we recommended in out first

      Tutorial is to start with a demo or paper account to validate their methodology.

      only after that period, can they confidently start Live trading.

      Thank you.

  6. I’m just a beginner when it cones to trading online especially options trading. Though I have a little idea about forex but options is way too much for me. Thank you so much for the information and I will try to share it out to people who are in need. However, I heard the dangers associated with options trading is too much and the rate at which we have scqmmy websites, how do we figure that out

    • Hi there Rodarrick,

      In the world of fake news, getting the right information is Premium. 

      Due diligence is what is required. As such, we publish additional videos to go

      Along with the. Options trading tutorial. 

      The videos showcase our actual trades we have taken through the week

      So beginners like yourself can spot these opportunities and profit from them.

      Hope this helps.

  7. Hello Telex, trading has been something I find really difficult to comprehend it’s ethics and how to be become successful in it. I had quite a bit of a problem understanding it at first, but I seem to get a hint of what you take trying to pass across which is understanding how you can become successful in trading. I still need more of such useful post to get a full understanding of it. Best regards

    • Hello Benson,

      I agree trading can seems difficult at first sight but really

      It is not when one puts the time in it.

      This series of tutorial we are publishing aims to reconcile most people

      with this idea.

      I hope you subscribed to be first in line everytime a new article is shared.

      Thank you.

  8. Getting the right methodology would only spell success for any trader who wishes to trade forex.  Well! I would not say that this is not worthy because I have learnt a lot here. For a truth, I will love to keep learning about this before getting my money into it. Please, is there a way I can try my methodology in a free account first or how do I go about the practise? Or would I need to start with my money straight up?

    • Hello Bella,

      We recommended in our first written article of this for beginners to open a demo or paper account

      where they can learn how to master the best trading strategies for them before going Live.

      Check it out and let us know if you need further guidance.



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