Channel Trading Strategy : Long at the support (bottom of the channel) and Short at the resistance (top of the channel)

Reason to entry : QQQQ movement was in trading channel between 43.5 and 41.75 for the recent week. Open position for Put Options at resistance area with the target QQQQ will move downward within this channel to reach the bottom of the channel. The pattern show potential for double top pattern

Here ’s the case study of options trading use put options as tools to get benefit for the stock that has high possibility to slide after strong rally in bear market. Buy CME PUT 300 @ 5,9 USD  at July 2, and the value as of July 8,  35.1 USD. This trading strategy can implement with more save way if we put the trade exactly at the breakout area. Less gain but also less risk and high possibility to get the profit

Since March 9, the market has shown the best performance by keep increase regardless the flows of bad news. But, the questions now how high this rally can go and how long it can sustain this performance.

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Let’s say (hypothetical): The market is trending higher. You find a stock to buy. You setup the proper risk-to-reward scenario.

So, how do you determine how many shares to buy?

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