 Hello, everybody. Lee Lowell here, smartoptionseller.com. Yes, we're back for another Saturday. We talk about options trading and we talk about stock charts. This morning, we will be discussing part two of options trading basics for beginners. Last week, we went over some of the initial options trading basics, talked about call options, got another long list of questions that came in from last week on specific areas of the pricing of options. Today, I will discuss a little bit more about how we term certain strike prices, how their prices come about, how to factor or figure out the break-evens of certain prices. This is all very important. If you want to become a smart option trader, you need to understand how option prices react in regards to how a stock moves and how the option will move along the expiration scale as well. These are all important things. Options trading isn't the easiest thing right off the bat. It's not like buying stocks where you just buy a stock or you sell a stock. Options trading has a lot of moving parts to it, so you need to understand these moving parts so you can become a smarter option trader, make more money in the future. Let's take a look at some of the more basic fundamentals of options pricing and some of these terms that you'll hear people throw about throw around certain terms. I want to explain some of these things and just help you understand a little bit more about option pricing. Then after we do that, we will go into our Saturday synopsis. We'll take a look at the stock charts, see what happened over the last week's worth of trading, and come up with an idea of what may be going forward for next week. Let's jump right in. As you see, I have my cheat sheet here, my Word document, and this is nothing fancy. We're not fancy here. I'm just trying to teach you all the good stuff about options trading, so there's not a lot of bells and whistles, not a lot of crazy charts and things, just real basics. Let's go right to it. When you look at an options price, obviously, if you trade options, all options have a price. They have a bid price and an ask price, just like a stock does. Options prices can be bought or sold at will, don't have to be held until expiration. You just go in and buy the option price at whatever you can get. You try to get it for a limit price, which is somewhere in between the bid and ask price. You don't always want to have to pay right at the ask price. That's paying retail, as I like to say. You want to haggle a little bit. Anyway, you try to buy somewhere in between the bid and ask, and when you want to sell the option, you try to sell it somewhere in between the bid and ask prices. Trading options are just like trading stocks. They have a bid and ask price, and you try to buy or sell it at whatever best price you can get. Once again, the option does not need to be held until expiration date. You can get in and out whenever you want, whenever you deem it necessary or profitable for you, or if you're going to take a loss, get out when you feel your loss level is hit. Option prices are there to be bought and sold, but the question is, where do these option prices come from? How are these options priced? What are some of the lingo around options prices? If you've been trading options at all, or even if you're just starting out, all option prices have a strike price. That's how options are listed with their strike price. There's tons of different strike prices listed. You've got puts and calls, but each put and call has their own strike price. Those strike prices are set by the options clearing corporation, and it's based on demand for those options. You can't just buy an option at any old price you want, an option strike price. I should say the strike prices are set by the options clearing corp, and I think the exchanges might have some say in that as well. Let me just bring up the option chain here from Interactive Brokers. Here we have the option chain. This is for Apple options, and I used this option chain last week. If you watched video from last week, and if you missed the video from last week at all, I'll put it up in the last towards the end of this video. You'll be able to click on it within the YouTube video anyway. We have the option chain here. We've got call options listed on the left, put options on the right, but in the middle here is the strike price column, and we're just talking about strike prices. These are the strike prices that you can choose to trade the options on. The strike prices for Apple, these are Apple options that expire in May 2021. As I scroll here, you can see the strike prices range all the way from $25 a share all the way up to $225 at the top end. Let's move this out of the way, $225. Apple stock itself last traded around $120 per share, and these are all the different strike prices you can choose. Let's go back to our word document here. Let's understand how options are priced according to where the stock price is. Let's look at a little bit of the lingo here. These are options trading terms that you should become familiar with. Out of the money option, and we're going to talk about call options again today. We're only focusing on call options. These terms will apply to how call options are priced according to where the stock price is. Out of the money call options is when the strike price is above the current stock price. Let's just say the stock's at $100. Any strike price that's listed above $100 is considered out of the money. Out of the money. Why is it called out of the money? Well, if the stock's at $100, and let's say you bought $120 call option, if you exercised that call option, that means you would be buying the stock for $120 a share. If the stock's at $100 in the open market, there's no reason why you should exercise that call and buy the shares at $120 when you can buy the shares at $100 in the open market. It doesn't make sense. So that's why it's called an out of the money option. It has no value. You would be making a huge mistake if you exercised that call option to buy the shares at $120 when it's currently trading in the market at $100. That would be locking in a $20 per share loss. So that's considered out of the money. It doesn't have any value yet. Call options that are at the money, ATM for short and OTM for the out of the money. ATM is the strike price is pretty similar to the current stock price. So if the stock's at $100, you're looking at the $100 strike call options. That's considered at the money same level as the stock price. And the in the money options, call options, is when the strike price is below the current stock price. So stock's at $100. Any strike price below $100 is considered in the money. So let's take a look at the eight. So we'll look at some examples here, but consider the stock at $100, the $80 call option. If you exercise that $80 call option, that means you could buy shares at $80 and immediately turn around and sell them for $100 in the open market. So that's got a $20 of real intrinsic value. It's called in the money. It has value. So these three terms, out of the money, at the money, and in the money is just the way to describe where the strike price sits in relation to where the stock price sits. And like I said, in the money call options sit below the stock price, at the money options, call options are same as the stock price and out of the money call options are set above the current stock price. Those are just terms that you should know. If you're having a conversation with other option traders, you can be more well versed and understand where the options stand. Now, an options price. Like I said, when you go to buy or sell an option, it has a price. Where do those prices come from? And what makes up those prices? You need to get a little deeper with options. These are some things that you have to understand how options are priced because it will help you become a smarter option trader. So when options value or an options price or an options premium, those are all the same terms that describe what an option is worth. A premium price value cost, all those terms describe an options price. And an options price is made up of two different components. You got intrinsic value and extrinsic value. And intrinsic value will only apply to in the money options. Intrinsic value means that option has real worth. It has real actual value. If you were to exercise that option, it would have real value right then and there. So let's let's try to explain what those terms mean. And so you can understand the value of an option and where it's worth at any moment in time. Let's consider the scenario where the stock is $100 per share. The $80 in the money call option. So remember, $80 it's in the money, its strike price is set below the current stock price. Let's just say this $80 call option in the market was worth $22 per contract. That would mean a $2,200 investment. Each option contract consists of 100 shares of stock. So any option price, option prices are based per contract, you have to multiply the option price times 100 to get the actual dollar amount. So let's just say this option contract, the $80 call option is worth $22 per contract. It has intrinsic and extrinsic value. Now, in order to find the intrinsic value of a call option, you subtract the strike price from the current stock price, $80 from 100 is $20. Okay, so $20 of this $22 whole amount is from intrinsic in the money real value. And the other $2 is what's called extrinsic value. It's just whatever's left over after the intrinsic value is taken out. Where do we get $22? Well, like I said, the $20 is the difference between the strike price and the current stock price. If you were to exercise this $80 call option today, that would give you the right to buy 100 shares at $80 a share. Then you could immediately turn around and sell them for $100 in the open market. So that is an $20 real value right then and there for that option. So that has to be priced into the full option price. That's $20 of real value. But the whole option is worth $22 per contract if you were to buy or sell that option. So that extra $2 is just what's called extrinsic value. Extrinsic value is what's left over to compensate for days to expiration. That's how much time there's left until the option expires. You got volatility to deal with. And then a very small amount, interest rates and dividends. But for the most part, it's the days to expiration and the volatility of that stock that makes up this extra $2 of extrinsic value. So that's the in the money call option. It has intrinsic and extrinsic value. Just remember, only in the money options will have intrinsic value. Now let's take a look at an at the money call option. The $100 call option has the same strike price as where the stock currently is. The $100 call option costs $7 per contract. And that means it's only made up of extrinsic value. If you were to exercise the $100 call option, that means you can buy shares at $100. But since it's already trading at $100 in the marketplace, there's no gain or loss at that point. You're buying the stock at $100 and it's trading at $100 in the marketplace. So there's no real value in that option yet, unless the stock starts to move up in price. If you buy the stock at $100, and it's still at $100, you've got no gain or loss. But that option costs $7 per contract to purchase, which is $700 actual dollars in real money. Take the contract price seven, multiply by $100. That's $700. So when you buy that option, it costs $7 per contract. It only has extrinsic value. There's no real value to it yet. If the stock stays at $100 for the life of the option, you're going to lose all that $700. Extrinsic value, by the time expiration rolls around, extrinsic value gets completely stripped away from an options price. It will no longer exist at expiration. You're only paying for the future movement for the stock of the stock. If the stock doesn't move, you're going to give away all that extrinsic value. Whereas with this $80 call option, you've got $20 of real value built in, so you'd only lose $2 of extrinsic value if the stock didn't go anywhere. If it stayed right at $100 the whole time, this $80 call option would eventually be worth $20 per contract. So you would lose the $2 of extrinsic value. With the $100 call, it's $7 of extrinsic value. If the stock stayed at $100 the whole time till expiration, all $7 would just slip away. That's what happens with options. Extrinsic value just disappears as it moves towards expiration. I've used an example before. If you have an ice cube sitting out on the counter, over time that ice cube is going to start to melt away to nothing. That's the same thing that options do with extrinsic value. That extrinsic value just starts to melt away once the option starts to get towards the expiration date. If the stock doesn't move in the right direction, all that extrinsic value just disappears. So let's look at the $120 call option. Out of the money, stocks at $100. The $120 call option costs $1 per contract. That's $100. And it is, of course, made up of extrinsic value. It's all extrinsic value. $1 of extrinsic value. It has no true value yet. If the stock stays at $100, you're just going to lose that $1 of extrinsic value. And that's how options work. So the other thing that I had talked about last week was that you have to understand your breakeven prices. You want to know where the stock needs to move to in order for you to just breakeven on the trade if you hold it until expiration. That's very key to understand. I talked about that last week. Most players opt to hold the option all the way to expiration because they want to give themselves as all the time possible for the stock to move in their favor. So we always talk about the breakeven prices at expiration date. So the $80 call option, the breakeven is at $102 per share on the stock. How do we find that? Well, you need to know what the option costs. This $80 call option costs $22 per contract. So you add $22 to the strike price. $80 plus $22 is $102. The stock needs to move from $100 to $102 in order for you to at least breakeven on that option purchase. Once the stock moves above $102, you're making money. If the stock drops, you're going to lose money as well. If the stock drops, this $80 call option starts to lose money also. So it works in both directions. But it's important to understand where the breakeven prices take the strike price plus the option price gives you your breakeven on the stock if held to expiration. The $100 call costs $7 per contract. You add $7 plus $100. Your breakeven is $107 per share. So as you hold this option, as you hold this call option, the stock has to move from $100 a share up to $107 by expiration in order for you just to breakeven on the trade. You want to cover your cost in the trade. So you always need to know where your breakeven is. And on the $120 call, it costs $1 per contract. So your breakeven is $121 per share. Stock has to go from $100 all the way up to $121 just to breakeven on the trade. So part of your decision-making when you buy options is how strongly do you feel the stock can move to the breakeven price by expiration if you hold it until expiration. Now, if the stock moves greatly in your favor right away, let's just say next week the stock moves in your favor, all these option prices will go up in value. And then you could turn around and sell those option contracts and lock in a game. Okay, so it's very important to understand and watch the market because if the stock moves in your favor quickly, you can turn around and sell these options and make a profit. But if you opt to hold all the way until expiration, the stock has to move above the breakeven prices in order to make a profit. Let's just say you bought this $120 call and you know that by expiration it has to move up to $121 a share. Let's say the week after you bought this call, the stock jumped up to $130. Went from $100 to $130. You're thinking this is great. Now this call option is worth a lot of money. You could sell it right then and there and lock in your game. But let's just say you opt not to say I'm going to give this stock more time to appreciate. Well, let's just say by the time expiration rolls around, the stock drops from $130 all the way back down to $100. You just missed out on $30 of gain. Now this call option will expire worthless with no value. So it's very important to understand that options are a wasting asset. If you don't take advantage of them by a certain time, you're just going to give back all the money. So if a stock moves in your favor quickly, think about taking profits. We talked about that last week. So those are some of the things to consider when you're buying call options. You need to understand the terms which will explain where the strike price falls in conjunction with the stock price. You have to understand extrinsic and intrinsic and extrinsic value. And you need to understand how that applies to each option contract based on how much it costs and what the breakevens are. So let's take a look at some Apple options real quick, just like we did last week. Let me move myself over here. So we have the May 21, 2021 options on Apple that expired 62 days. Here's the Apple tab, Apple last price 120. Yesterday, March 19, 2021. So here's the call options over here, bid and ask prices. Like I said, each option has a bid and ask price. And so Apple's at 120 per share. Let's take a look at some strike prices. So the 120 calls are over here with the stock trading right near 120. This option is worth about $7. We had that right on $7. And the breakeven obviously would be 120 plus 7. So now, your breakeven is at $127. Apple's at 120. If you hold until expiration, the Apple has to go up to $127 a share. Those are the at the money options. Now the in the money options, we can look at the 100 calls in the money. 100 calls cost about $21 in change per contract. That's a little over $2100 in actual dollars. So you take the 100 strike, add it to let's say 2115. So your breakeven is $121.15. $121.15. Apple only has to go up $1.15 from 120 to 121.15 cents in order to break even on that trade, if held until expiration. That's not very far for Apple to move. That's not so bad. So remember, that's the in the money option. That's the in the money option. Take the strike price plus the cost of the option will give you the breakeven. That tells you where the stock needs to move to. Like I said, the 120 calls at the money cost $7. Apple has to go from 120 all the way up to 127. Now if we look at an out of the money, let's say the 140 calls is out of the money because the strike price of 140 is well above the current price of the stock. And that option costs about $1.62. $162. I take the strike price, add it to the option price. So $141.62 is your breakeven if held until expiration. Okay, Apple has to go up another $21 or so in order to just break even if you hold until expiration. Now remember, I said, if Apple shoots up very quickly, like the next week, all these option values are going to go up dramatically. So you can think about taking profits early if you want. What profit level you decide do you want to take a profit level at a 25% gain 50% gain 100% gain completely up to you. But it's very important to take those profits at some point. Because like I said, the stock could always drop again. And then all that option value will just slip away. Okay. So there you go. There's your lesson for today. The second lesson of the introduction to options basics call option basics. So it's important to understand some of the terms, understand the strike prices, where they sit in relation to the stock price, figuring out how much the option costs, if it has intrinsic or extrinsic value, and where your break evens are. And, you know, obviously, you have to understand the chances of the stock moving from your its current price to your break even what are the chances of that I discussed the probability calculator last week, you can look at a probability calculator and look at some of your chances. So understanding the stock, knowing where it may go is also very important. You know, there's components, the options price is based on where the stock is. So you have to understand how to figure out picking a good stock and where you think it's going to go. And that's one of the basis, your basis of how to pick an option contract as well. Okay. So I hope that's been helpful. Let's move on to our next part of our journey of our Saturday synopsis. And let's take a look at the charts, see what happened over last week and see what's going on and see what may be happening for next week. Let's take a look. We always look at the SPY, which is the exchange traded fund for the SP 500. See what happened over the last week. There we are. Let's blow this up a little bit, widen out so we can see here's our one week's worth of trading just this past week. As you can see, it was a down week. Okay, as we came off last week, we had a nice run up, came off the lows here from two weeks ago had that nice sell off, but it bounced pretty good. And it went up. But this whole week, it gave a decent chunk of it back on the charts. We always have our 20 day moving average, 50 day moving average, 200 day moving average, we have various patterns here listed on the chart. And down here, we have our RSI, which is an overbought oversold indicator. The defaults for the RSI are 70 and 30, which typically tells you if a stock is in overbought or oversold territory, based on the line here, the black horizontal lines are your overbought and oversold areas. I bump it out to 80 20. You can choose any parameters you want for the RSI. I bump it out to 80 20, which means if a stock gets above 80, it's typically overbought at that moment in time. If it gets below 20, it's considered oversold. Doesn't mean the stock will turn around right then and there. It's just giving you an advanced warning that, hey, this stock is getting into overbought territory or it's getting into oversold territory. But you cannot use it as the actual turning point of the stock. It's just giving you a warning. So here we got, we had a down move all week resting or found support right at the 20 day moving average. Small stocks that are in a nice either uptrend or downtrend will find some support or resistance as it pulls back to either the 20 day or 50 day. I put a little more importance on the 50 day moving average. But when stocks are in an uptrend, you'll see the pullbacks to either the 20 day or the 50 day as it moves up along the scale here. Stocks had good movement upwards, and then when it does bounce, it bounces off the 20 day or 50 day. So if you're looking to get long at some point, if you're trying to time your entry, you wait for a pullback to the 20 day or 50 day as long as the stock is continuing in an uptrend. So the market is still pretty strong. I'm still bullish. The sell off this week is and prior is that people are concerned about interest rates. The Federal Reserve here in the US decided to keep interest rates unchanged, close to 0% for the foreseeable future until at least 2023. It's a long time. But interest rates also trade in the open market. We got Treasury bills, bonds and notes that all have an active market and the players in those markets can have other thoughts than what the Federal Reserve does. So that's why interest rates have been going up because people or traders know in the future the Fed will eventually raise rates. So they're sort of getting a jump start on things. But historically rates are still very, very cheap. Let me see if I have the interest rate symbol here in my watch list. Let me see. Let me type it in here. Okay. So here's the 10-year, this is the 10-year US interest rate note on a daily basis. Okay. So obviously last March 2020, we can see interest rates dropped dramatically down to about 0.4%. Okay. And we were at that lows for a long time. And then just the last few months, we started to tick up. Let's take a look at a long term monthly chart of interest rates. So as you can see here back in the early 1980s, interest rates, 10-year note topped out around 16%. And has just since 1982 has just continually moved lower, lower, lower, lower. And we hit the lows here. Each bar is one month's worth of trading. So we hit the low last March 2020 for interest rates. But look where we are. We're back to about 1.73%. Historically, still just dirt cheap for interest rates. Okay. If the pandemic hadn't happened, we'd still be at these very, very low historical interest rates. So people are getting all up in arms that interest rates are going higher. Yes, they're going higher, but they're going higher from the most extreme lows that we've ever seen. So I'm not so worried about interest rates affecting the market. Maybe in the short term, people get a little worried about it. But in the long run, as we know, stock market goes up over time, whether interest rates are high or low. Let's take a look at the Dow Jones industrial average. One of the strongest of the three indexes right now. Open this up a little so we can see a little better. I drew this channel here, we have the the Dow Jones making this nice up move up channel, getting a little ahead of itself, I think, towards the end of last week. So here it ended the week yesterday, this bar right here is where it ended came right down to the top of the up trending channel. So let's see if it'll bounce here next week and continue its move up. If there's a sell off next week, it'll come down within this channel, probably sit on the 20 day moving average here. But we'll see the market's been strong. But let me blow this up to the monthly chart for the Dow. Obviously, since 1982, let's go back to 1982, all the way back here, markets gone up, whether interest rates go up or down, market will still go up over time. The stock market is where you will get a decent return on your money in the long run. Okay, so the Dow, here's the pandemic last year, nothing but up in this channel, nice little up trending channel, got a little ahead of itself, and now it's come back down to touch the top of the channel. So let's see if it'll bounce here. Let's take a look at the Nasdaq. Now the Nasdaq is made up of most of the tech stocks that you and all you and I and everyone else likes to play with. It's having the most trouble out of the three indexes. Okay. Last few weeks, we're in this down trending channel. And part of technical analysis is drawing these lines to give yourself an idea of where a stock or an index may go. Now the Nasdaq had sold off, made this down trending channel, but then it bounced. So you can kind of draw an up trending channel as well. What we see here is, what we see is, here's the top of the down trending channel. The Nasdaq is sitting right on that level. Okay, we want to see it bounce. It's already below, here's the 50 day moving average. I know it's a little hard to see. Here's the 50 day moving average. So the Nasdaq is below the 50 day moving average. We want to see it bounce back up relatively quickly. We don't want it to be underneath the 50 day moving average for too long. You've got the down trending, the down trending, 20 day moving average. Let me remove some of these lines so we can see things a little bit better. We can always add those back in later. Okay. So here you got the now a down trending 20 day moving average and the Nasdaq touched right on it. So we want to see the Nasdaq start to move up again. Okay. It's below the 50 day. Don't like that so much, but we want to see it bounce back up. So the Nasdaq's having the hardest time out of the three indexes, the S&P 500, the Dow, and the Nasdaq. So the Nasdaq's got a little work to do. Maybe we found some footing here. You can always draw a support line. So it looks like maybe right here, we've got some support. We draw the lines at most recent lows. So you've got a kind of a support level here. Okay. We want to see this area hold. So if the Nasdaq comes off again, we want to see it hold right around this 13,000 mark and bounce. I'd like to see it bounce before that, but it's getting close to an inflection point here. We want to see it bounce sitting on the 20 day moving average. It's below the 50 day, but it's trying to find itself a bottom here. We don't want to see it come all the way back down again. So the Nasdaq's got some work to do. The S&P 500 looks decent. Take a look at that one more time. S&P 500. I don't think we looked at this one yet. So let's take a look at the S&P 500. It's sitting right on the 20 day moving average right here. Okay, blow it up a little bit more sitting right on the 20 day. So let's see if it'll bounce and start to move higher as well. Let's take a look at some individual stocks like we always do every week. Take a look at Apple. Always look at Apple. I'm long Apple. I need Apple to go up. It's been quite frustrating. You can see Apple had this congestion pattern a few months ago, finally broke out, but has now come back down into this downtrending channel. And right at $120 a share, it's roughly right where the breakout was from this congestion pattern a few months ago. Stocks go up, they go down, they go up, they go down. Just like I gave in the earlier part of the video about taking profits along the way. If Apple was making all-time new highs here, you think, oh, it's making all-time new highs. I think it's going to keep going up. I'm going to hold on to my call options for a bit longer. And then boom, Apple comes all the way back down, gives up over $25 of value. And now your call option is worth a lot less. So just be mindful. If you're playing short-term call options, options that expire a month or less, you've got to take profits quickly when you can. So Apple's in this downtrending channel now. It's sitting right on the top of the downtrending channel near the 20-day moving average. We would like to see Apple start to gain its footing and start to move back up again. So tech stocks are still a little hesitant here. People are selling out because interest rates are going up and moving into, they're rotating into more of the Dow industrial stalwarts. So we've got some more selling in the Nasdaq. Eventually, value will come into play. People will see, okay, Apple's at a value level now. Let's start to jump back in. So obviously, stocks will start to move up again. It's just trying to figure out when that will happen. And so we try to look at chart patterns to help us decide when that may happen. Apple's falling from $145 all the way back down to $120. It's given up some good gains. So let's see if it can find some footing here. Let's take a look at Amazon. Amazon, still in this long time channel, came down like two weeks ago, almost hit the support line here and bounced pretty good. So now it's hugging. This is the 200-day moving average. 200-day moving average is the granddaddy of moving averages. It's basically the line in the sand for a lot of stocks. Amazon's been trading below the 200-day moving average for a decent amount, popped above it, down again popped above it. So the 200-day moving average, it's acting as a magnet for Amazon. We would really like to see Amazon start to get its act together and continue to move up. But at $3,300 a share, it's a pricey point. It's at a pricey dollar point. Does that really matter? To some people. But what the chart is telling me is that it really still can't figure out where it wants to go. It's just meandering in a pretty wide range for sure. But falling below this 200-day moving average was pretty significant two weeks ago. It's trying to find its footing and pop back above it, which it has a couple of times, but still finished below the 200-day moving average. So Amazon still has some work to do. It needs to get off its butt here and get back up into this triangle here and start to move higher if it can. So Amazon not really doing much, but with a bearish slant to a degree. I'm not completely bearish on it, but because Amazon's just incredible company, it's hard to believe that its price will go down. But at this price point, there's a lot of people are digesting the moves and saying, okay, let's just wait a little bit longer before we get full on bullish again. All right, so that's Amazon. We looked at Apple. Let's take a look at Tesla. We look at some of these popular stocks because these are the stocks that people like to trade. And they want to know where the stock may be going. Tesla, obviously hit all-time new highs near $900 a share. This is post-split from back here, back in September. It's made some triangle patterns, triangle, triangle, and eventually it falls out of the triangle pattern. Trading around $650 a share. Tesla's got some work to do. It's below the 20-day, below the 50-day, still above the 200-day. So it's kind of meandering around in here, trying to figure out where it wants to go next. Can always draw another triangle pattern here. Always attach the tops, attach the bottoms. So you've got another triangle pattern that's sort of forming, trying to figure out where it wants to go. So it may meander around here a little bit until it pops above or below this level. I think most people would like to see it go up. So tech stocks have taken a beating of late. People are getting out there. Very lofty levels. Interest rates are going up. That spooks some people out. So they start to take profits and sell. Stocks like NVIDIA. NVIDIA has been in this channel for a long time, kind of fell below it. Caught some support right at the 200-day moving average and popped back within the range. So now it's sitting again right at support right here at the bottom of the channel. So NVIDIA needs to pop. The next move should be pop up towards the top end of the channel. We'll see. Stocks like Adobe. These are very expensive stocks, but very popular as well. Adobe's been coming off. It's below all the moving average, below the 20, 50-day and 200-day moving average. You can draw this downtrending channel for Adobe. Now it's kind of stuck in this channel. The next move probably could be to fall a little bit more, maybe towards the bottom of the channel. Or if the market could get its act together, it could pop out above it. So it's more of a waiting game. You want to see a stock move outside of a channel or support and resistance level before you actually get in. You want to get in on the move, but you want to wait for the move to happen first. You may not buy the bottom, but at least you'll be getting on after the stock makes showing you signs of it's moving in the right direction. Let's see what other stocks do we have here? Oracle is a stock we've been playing. We've been trying to play. I like Oracle. Had this nice move up. Earnings came out and knocked it back down to reality. So it's sitting right on the 20-day moving average. Oracle, good company. If you're looking to get long Oracle, somewhere around here you could be thinking, all right, maybe it's finding support. I might want to see it start to tick up again before starting to get long. So these are the things that you want to look at. The moving averages are still moving upwards. That's important. You want to see the moving averages trending upwards, not downwards. Let's see. What other stocks do we have here? We'd like to look at Netflix. There's always a popular stock still in this wide channel. We can even lengthen this out a little bit because it's just still been trading in this long, long channel here. So you can see it's in between the moving averages, but still in this broader range could pop back up again right now, sitting on support at the 200-day moving average, upsloping 200-day moving average. The next point should be a move up, but if it does come off, you'll probably catch support down here. It's still a big move. We don't want to see it drop that far. We'd like to see Netflix start to move up, but that'll all depend on the broader market in general and how people are feeling. What else? What else would we like to look at? Walmart, another favorite great, great company, but stuck in this downtrend, 20-day, 50-day moving averages are sloping downwards. That's giving some headwinds to it. The 200-day starting to flatten out a little bit, and you can see the price movement. Price movement is down. If I were to get long, Walmart, I'd wait to see another confirmed move to the upside. Right now, it's still languishing down here. If you put your money in Walmart, it may just meander for a while. You may get frustrated. So you want to make sure the stock's moving in the intended direction before you actually get in. What else do we like to look at? Microsoft, another tech stock that's trying to break above the upper part of the channel, just meandering around. It's stuck between the 50-day and 20-day moving average. This all depends on how the overall broader market will start to move as well. So Microsoft's stuck here. If it could bounce, then it will get some good momentum behind it. We want to see it get above this resistance line. So it's got a confluence of things here. It's in between the 20-day and 50-day at the resistance line. If it could get its act together, it can move. Otherwise, it's going to get knocked back down and probably start to hit towards the 200-day moving average. So these are some of the popular stocks. Google, we can look at. Google, still pretty strong. It's got this support level right at the $2,000 level, roughly right here. Don't want to see it drop through there if you're long. If it does, it's trying to close this gap right here. This big gap. Lots of stocks try to close gaps somewhere in the future. But it's got the 50-day sloping upwards, so it could catch some support right around there as well. So Google's been pretty strong for tech stock. Twitter. People like to look at Twitter. Twitter is made all-time new highs. I think that was all-time new highs. Let's take a look at the monthly. Yep, all-time new highs near $80, but it's come off underneath the 20-day moving average. You've got the upsloping 50 down here waiting to catch it if it does keep falling down. So Twitter is just kind of me entering around not much for me to see on this chart. And let's look at GameStop as our last one here. Still hanging around. GameStop $200 per share, I should say. I'm not playing it. I'm just watching it. I'd love to see crazy stocks like this, but there's really no sense of me playing it. But it's still hanging around. Last one, Riot. We want to look at Riot. Riot is tied to Bitcoin. This is Riot. Company is Riot. R-I-O-T, Riot. And it's tied to the moves in Bitcoin. Obviously, Bitcoin's hitting all-time new highs around $60,000 per coin. So Riot is moving in sympathy. And it's $60 a share, so it's moving up. The options volatility on Riot is tremendous, huge. So if you're selling options, we're selling put options on Riot. You get really good money for these options. You can sell these way out of the money, put options on Riot, and they're paying decent amounts of money. So if you're into Bitcoin and you think Riot is going to keep falling Bitcoin higher, which I do, that's my personal opinion, no personal advice here. Selling put options on Riot to give you an opportunity to buy shares of Riot way down here could be a good way to earn some passive income by selling way out of the money, put options on Riot. All right, so that's it. That's all for today. Getting close to our 45-minute mark here. I know that's long for some of you, but I want to give you some good information. So that's it for me today. If you like this video, if you think you got some good information, good content, give me a thumbs up down below the YouTube channel. Don't forget to subscribe if you're not subscribed yet. It's important for you to do that. Leave me a comment, send me an email. Love to hear from you. And remember that the video on part one of the options trading basics will be popping up. So if you haven't watched last week's video, watch that. And lastly, let's go to our website and show you your put selling basics. Download our free guide on how to sell put options that we do. We are put option sellers. We are option sellers in general. Name, email address, put selling basics, get a free copy. And lastly, if you need some help, one-on-one coaching, and our two newsletters here, just hover your mouse over the services tab, click on one of these three items. All right, so that's it for me today. I hope everyone has a great weekend and a great week ahead. And I will see you here next Saturday. This is Lee Lowell signing off.