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Approach
What is OneWay?
OneWay is my systematic approach to finding stocks with relative strength and weakness in the market. Click here to learn more.
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What are your trading philosophies?
In general, form a market opinion and find stocks with relative strength and weakness using technical and fundamental analysis. Form an opinion on the stock, devise a game plan and be a directional trader. To learn more, read through my Blog archives and subscribe to the news feed to keep current.
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Do you use technical analysis?
Yes, my searches quantify technical indicators and perform the first level of screening. Using the OneOption Scanner, I quickly flip through charts and I look for tight directional formations. On a longer-term basis, I place more weight on long, moderately sloped trend lines and major moving averages. As my time horizon zooms-in, 5–10 day horizontal support and resistance levels increase in importance. The volume is also important.
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My biggest tool is my scanner. I have complex programs that measure a stock’s current condition and compare it to its past. Once the stock passes through the filter, I keep the analysis fairly straightforward. I have a variety of charting packages that I use to draw trend lines and overlay moving averages. I have also found Yahoo Finance to be a great free resource. I am very visual and if a pattern (ascending triangle, cup and handle…) is obvious it will carry more meaning because I feel more traders will see it as well. Trend lines, moving averages, price/volume and support/resistance levels are my weapons.
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What fundamental analysis do you use?
Fundamental analysis is an integral part of my decision making. It gives me confidence and “staying power”. I evaluate all of the financial statements and I’m a big fan of liquidity and cash flow. I look for earnings and revenue growth and I use forward P/E and PEG ratios help me cut to the chase. I also look at the macro environment and evaluate competition, brand loyalty and barriers to entry. The opposite would apply to short candidates.
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How do you determine the option strategy?
Option trades are the icing on the cake. Before I even consider trading options, I look at the liquidity and evaluate the bid/ask spreads. Only about 30% of the candidates can be considered for option trades because the bid/ask spreads are too wide and I’m giving up too much “edge”. I dissect my opinion of the stock and the direction, magnitude and duration of the move will determine the strategy. I also breakdown and factor in my confidence in the analysis, the market and my recent performance. Once these variables have been “nailed down”, I look at the implied volatilities of the options. Collectively, the answer to these questions will lead me to an optimal strategy. To learn more about my option trading philosophies, read my Blog.
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Why do you look for stocks that don’t have options?
I won’t pass up a good trade just because it doesn’t have options. In fact, some of my best trades use the underlying stock. One of the advantages of being a small trader is that I can trade small size and make it worthwhile. I will consider trades that the “big boys” won’t even look at and a few hundred shares can be very lucrative. I can spot a trader who is trying to move size in an ill liquid stock and I want to shadow them. This is a big advantage for small traders and it should be discarded. Once you get away from the big capitalization stocks, the option liquidity falls off quickly. A word of advice, trade stock!
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Why do you trade relative strength and weakness?
A trader needs an “edge” and I feel that predicting the market on a short-term basis is a difficult task. All eyes are focused on the S&P 500 and if ever there was “fair value”, it is the price of that index at any moment in time. When I’m trading against large institutions that offset with options, baskets and futures and have lower commissions and a floor presence, I don’t think I can gain an advantage. On the other hand, if I can find stocks that are leading the market higher or dragging it lower, I can get the market direction wrong and not lose my shirt. Often, I can make money on the trade. If I combine long and short positions, I can reduce my market risk and place directional trades. I’m also able to consider less liquid stocks that are in a very predictable pattern. This is my edge.
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How do you place your stops?
Before I get into a trade I outline my expectations for the stock. If it has lost its relative strength or weakness, violated an important price level or gone flat, I will consider getting out of the trade. In the Daily and Weekly Reports I give general entry and exit guidelines. In the option reports I simply send Update Alerts when it is time to get out. I’m more tolerant of option trades because the risk is limited and the bid/ask spreads will keep me from jumping back in if the stock gets “on track”. Where options are concerned, once I’m out… I’m out.
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What happens once a stock is on a watch list?
Every day our routine yields a handful of stocks that make it into a global watch list. These stocks are poised to move or in some instances they’ve already started. If that’s the case, we want to let them rest for a day or two before taking a position. The best stocks each day appear in the Daily Report watch list. The ones that get the most mention make the best trades.
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Why do the stocks seem like they have taken off?
Often the stocks have moved and that is how they gained our attention. We seek stocks that have done something noteworthy and we want to ride the momentum. Often we need it to work off an overbought or oversold condition before we enter. That is the function of the watch lists. They are a holding tank for possible trades.
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Do you trade earnings?
I look for high probability situations. To me earnings are nothing more than a crapshoot. Sometimes the company exceeds estimates and they get hammered. Other times they miss “the number” and everyone loves it. I honestly have not met anyone who has consistently beat this game. I have had success trading before and after releases, but not during. I also don’t like to trade news and this certainly falls into that category.
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Do you trade news?
News to me is “noise”. I need to let the excitement settle down before I can tell which way the stock will go. In a news environment, the stock is all over the place and it is easy to get “scared out” of a position with the rest of the speculators on the first whipsaw. To me a good trade is one that is on a nice straight path without much volatility. A trade that I feel good about and I have staying power in. By the way, I trade in a vacuum. I don’t like to be influenced by outside information. Personally, I like to trade in the absence of news. It is supply and demand in a pure form where I can normally get a good read on what’s going on. The most interesting trading opportunities are the ones were the volume is spiking, the price is just starting to move and there is no news. You’ve read deep into this so here is a buried tip. Look at stocks that are closing on their high/low of the day. In particular, where a nice move on abnormally high volume has push the stock to an extreme in the last 15 minutes of trading. If you can find them… the move tends to continue the next day. Before you pull the trigger, make sure there isn’t a scheduled news release after the close. This would nullify the opportunity.
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Do you trade index options?
I tend to stay away from index trades. I’m not opposed to trading them, it’s just that I can find a better “edge” elsewhere. On occasion, I will trade out-of-the-money (OTM) put credit spreads on the OEX if the implied volatility gets over-extended. An “edge” exists in that market and strategy. Hedgers pump up the put premium (relative to OTM calls).
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Do you look at implied volatilities?
Yes. I look at the overall implied volatilities (IV’s) and I use the VIX to help me assess the macro environment. Of greatest importance is relative value. The same holds true for a stock. I’m interested in the option IVs compared to the historical volatility of the stock, but I’m also interested in the option IVs compared to the historical IVs of the options. In general, I buy low IV options and sell high IV options provided that the high IV is not the result of a sudden, uncharacteristic spike.
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What should I do if the options are ill liquid?
If the opportunity looks good, trade the stock. Don’t give up your “edge” to the option Market Makers and don’t forego a solid chance to make money.
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Do you trade spreads?
Yes. I have two option reports that extensively make use of spreads. Credit spreads and diagonals are my preference.
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Why is the market important?
75% of all stocks follow the market. If I can forecast the market with some accuracy, I can weight my long and short positions accordingly and boost my performance relative to being balanced.
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Billing
How will I be billed?
OneOption, LLC requires everyone to agree to auto billing. Your credit card will be billed the day your subscription expires. This policy makes it convenient for both of us and automation helps me keep your subscription costs down. To avoid being charged for the next period you must cancel your subscription seven business days before it expires.
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Are all of the services offered separately?
Yes. All of the services are offered ala Carte and you must subscribe to each one separately.
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Is there a discount for multiple services?
Instead of inflating the prices and offering discounts, I decided to make all of the services reasonably priced. At the end of the day, if the service doesn’t pay for itself you won’t renew no matter what kind of discount I offer. I do not offer a multiple subscription discount at this time.
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Can I pay by check?
Yes, a $250 minimum applies. Once the check clears the account will be permissioned. To make this arrangement use the chat or send an e-mail.
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Can I subscribe for a longer term?
With the exception of people paying by check, a quarterly auto-bill subscription is all I offer.
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How do I change my credit card number?
You will need to contact us by chat or e-mail to change the credit card number.
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Is the billing process secure?
Yes. When you subscribe to a service you will be directed to Authorize.net, one of the nation’s largest transaction gateways. They will collect and store all of your credit card information in their secure environment. OneOption, LLC does not have or want access to this information.
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How do I cancel?
We’ve made it very easy to cancel. When you log in, you will always start out in the Account Settings page. Simply scroll down to the subscription area. Below it and to the right, you will see a cancel button. Click it and you will see small boxes appear to the right of each subscription. Select the services you wish to discontinue and click cancel. You can use the service until it expires. If you don’t like what we offer, we apologize. The least we can do is to make it easy for you to stop your subscription.
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How far in advance do I have to cancel?
To avoid being charged for the next period you must cancel 7 business days prior to expiration.
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Can I change services and get credit for time remaining?
You can add services anytime you like. If you are hoping to change a service and have us apply a credit to the new one the answer is — no. I’ve tried to accommodate everyone by making my product accessible and by keeping the subscriptions short-term.
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Can I get a refund if I don’t like the service?
No, all sales are final. We give every customer the opportunity to take the FREE TRIAL and experience our products and services before they make a commitment. If you’re not sure, spend more time going to the free areas and checking out past reports.
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What credit cards do you accept?
We accept all major credit cards. Visa, MasterCard, Discover and American Express.
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What if the rates increase?
If you never cancel a subscription and it never lapses, you will never have a rate increase. When you sign-up, the auto-bill is configured and that is your rate.
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Can I get a refund if I forget to cancel?
Sorry. We will not give you a refund. If you suspected two days “in” that you might not like the service, cancel it right away. You can still continue to use it until it expires and you won’t have to remember to cancel it later. We’ve done all we can to make canceling easy; you have to do your part too.
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Do you offer a FREE trial?
Yes, we have a great 5-Day FREE TRIAL that allows you to try everything we offer.
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Can I suspend my account while I go on vacation?
We don’t have the systems or manpower to oblige that request.
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If I cancel a service and come back, can I get my old rate?
You are rewarded for continuing your subscription through “thick and thin”. If you cancel or you have issues with your credit card that causes a lapse, you will have to subscribe at the new rate.
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What if my credit card expires?
Contact us by chat or e-mail and we will call you to update your account. Please do not send credit card information via chat or e-mail.
Reports
How do I know which report to choose?
In the left panel of each report you will find a Learn More link. Click it to find out more about each report.
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All of our reports are posted to the website. Log in and go to the report to get current.
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How can I see the current positions for each report?
You will need to be a current subscriber or be registered for the 5-Day Trial. The open positions are found by using the Live Update link in the upper left panel of each report. The Live Update page for the Daily Report shows the watch list in the right margin. The symbols are green for bullish and red for bearish. Click on the symbol to bring up the original report.
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When I go to the site, why does the same report always show up?
This happens when the site does not recognize you as a subscriber. Visitors will see a past report when they surf the site. If you are a subscriber, you need to log in. Once you do so, the website will recognize you and the current report will appear by default.
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Can I get an e-mail alert?
Yes, the option report subscribers automatically get the alerts. The Daily Report and the Weekly Report have an opt-in box (Notify Me) in the left panel that needs to be marked.
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Can I get an e-mail sent to two different e-mail addresses?
We do not have that capability at this time.
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Can I sign up for a second trial so that I can try another report?
We want you to try another service. Once you’ve subscribed to a service, click on the report you want to view and a page will give you instructions on how to proceed. You are entitled to 3-day passes. If you have not subscribed, you are limited to one trial.
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Why does it say Subscription Required when I go to view the page?
The website does not recognize you as a subscriber. Your trial may have ended, your subscription may have ended or you forgot to log in.
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How do I sign–up for the e-mail alert?
If you subscribed to an option report, you are automatically signed-up. If you are on the Daily or Weekly Report, mark the Notify me box in the left panel.
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What is the difference between Trade Alert and Update Alert?
A Trade Alert is issued when an option report has a new position. The e-mail will contain a link back to the website. Log in and go to the report to get the trade specifics. An Update Alert tells you that there is new commentary on an existing position. Log in and use the Live Update link in the left panel. Look at the existing positions and identify the recent instructions by date. It could simply be commentary or it could be exit instructions.
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The e-mail alert only had a link and no trade information.
That’s all the e-mail will ever contain. We do not transmit our research. It is all posted to the website and you will need to log in to view it.
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Where can I look at the open positions?
With the exception of the Weekly Report, every other report tracks open positions and they are found using the Live Updates link in the upper left panel of the report. Here you can view charts and link back to the original report for quick reference.
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Can I go back and look at past reports?
Yes. After 10 days, the Daily Reports are moved over to the Past Reports archives. Use the dropdown menu at the top of the report to access them by date. The option reports are moved over to the archives one the trade has been closed.
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The Weekly and Daily Reports do not give specific entry and exit instructions. Investors and traders use their own discretion. Consequently, a track record is not available. To evaluate the performance, use the dropdown menu at the top of each report and look through the Past Reports. As you do so, view the 1-Year chart in the report and look at movement from the time the report was released.
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Each of the option reports contains a track record. To view them, click on the Performance link in the upper left panel of the report. The track record only reflects closed positions (not current positions). The Level 1 Option Report is based on a $10k model, the Level 2 Option Report is based on a $20k model and the Level 3 Option Report is based on a $30k model. Historical performance may not be indicative of future results.
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I use the average “ask” price for the first 30 minutes after the alert went out if we are buying options. The average “bid” price is used when we are selling options. If it is a spread, I evaluate if the strikes are trading at a price that would yield a fill. The entry and exit prices are subtracted and multiplied by the number of contracts used in the report. $10 per transaction is deducted for commissions (those rates are available using deep discounters). You can link back to the original report from the Performance area and at the bottom I include comments on what went right/wrong.
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I simply don’t have time to write commentary on over 40 stocks in the Daily Report watch list. I prefer to bring the most attractive candidates to your attention. In all update pages for all reports, there is often nothing to comment on. I’m don’t want to add “filler”. When you get an Update Alert, you’ll know that it’s important.
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How often do you update positions in the option reports?
The positions are updated 1–2 times a week. When I enter an option trade my risk is limited, the bid/ask spreads are wide and my commitment to the position is higher than it is for stock trades. I’m more willing to let it move against me. I don’t want to provide tick-by-tick commentary and if I see a note worth event, I’ll let you know. As expiration approaches, the comments will pick up. I also want to limit the Update Alerts. When you get one, you’ll know it is important.
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What is the model account for the option reports?
Level 1 ($10k), Level 2 ($20k) Level 3 ($30k). You can find out more about each option report by clicking the Learn More link in the upper left panel of each one.
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How are the option reports different from each other?
As the level increases the strategies become more complex and the capital requirement is higher. You can find out more about each option report by clicking the Learn More link in the upper left panel of each one
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When are the reports posted?
The Daily and Weekly Reports are posted before the market closes. The option reports are typically released during market hours. They can be spread out over weeks or come all at once. I trade when the opportunity presents itself.
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What if I can’t get filled on the trades because I’m busy at work?
There are two professional order desks I can suggest. I have worked with them throughout my career and they are very competent. Tell them your issues and they’ll solve the problem. Their rates are considered deep discount.
- Mike Cavanaugh (800) 599-5759
- Roger Mankus (800) 230-5570
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I can’t short stock in my IRA. What should I do?
If you can’t short stock, you can buy puts. Also, most firms will let you do call credit spreads where the risk is limited. If the options are ill liquid you will have to open a second non-IRA account or forego the opportunity.
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What type of orders do you use?
All of the orders are day orders unless specified. I normally use limit orders, however, you should have the ability to place conditional orders and trailing stops. Those are “standard fare” with most brokerage firms.
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Scanner
Why aren’t all of the columns populating?
When the market makes dramatic directional moves, you will find that the contra opportunities decrease. The good news is that the stocks that do appear are that much better and it takes less time to sort through them. Conversely, the searches that are going with the momentum will have many stocks to select from.
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How do I customize a search?
Before you can access our proprietary searches and customize your own pages, you will need to subscribe to the OneOption Scanner. As a subscriber, go to the Scanner area of the web site. In the left panel you will see a link labeled “Create A Scan”. To configure a page that matches your trading profile, you will be asked to define a series of variables.
- Identify the column you would like to configure (1–6).
- Select your market bias (bullish/bearish).
- Select your time horizon (day/week)
- Select the pattern (reversal/continuation)
- Select the trigger (early/confirmed)
- Select the Set-up.
- Once the Set-up has been selected, you will see the column populate. Sometimes, the column will have many symbols, other times it will not. It is dependent on the set-up and current market conditions.
- Click on a symbol to bring up a chart.
- If you want to have six different searches on the page, repeat steps 1–7.
- Once you have configured the whole page to your liking, use the button in the lower left corner to Save and Name the page as a favorite. From this point forward, you will find the page listed in the dropdown menu.
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How many stocks do you search?
There are over 20,000 stocks in the database.
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What do the four letters mean?
The four letters designate the Class of trade. You can learn more about the whole hierarchy by studying the Tutorials section.
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What does the column header mean?
The column header describes the Class and Set-up for the trade. Hover over it and you will see a brief description appear in the left panel. You can learn more about the whole hierarchy by studying the Tutorials section.
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What should I be looking for?
In general, I start with the 1W charts and look for very tight directional moves with very few head fakes. I pay close attention to periods where the stock has ignored the market and moved against it. If the 1W chart looks good, I zoom out to the 1M and 1Y charts. There I’m looking for a significant breakout/breakdown. I identify common patterns, trend lines, moving averages, volume and horizontal support/resistance lines. If the move is significant, the stock makes it to the fundamental screening.
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Are the charts real-time?
The charts are delayed up to 20 minutes.
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Are the results real-time?
The results are real-time the instant they are posted, but they are updated on a cycle.
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How often are the results updated?
There are 70+ searches that are run sequentially every 20 seconds. There is always a search running. When the results are returned they are posted to the appropriate page and the time stamp is updated for the whole page even though it was only one column that was “refreshed”.
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Is there a “best” search?
I use them all. If you have a particular style, you may find one better than another. In all of my experience, I have found great opportunities in all of them and I don’t want to limit myself.
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Why aren’t there more Weekly searches?
My customers are focused on short-term trading and the demand for the weekly searches is minimal. Should that change, I will add them.
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What is the significance of Movers and Pre-Open?
These are two very powerful tools that are free for all traders to use. They will quickly help you get your bearings before you start your trading day. In the left panel of the Scanner you will see a link called “How to Scan”, use it to learn more about this resource.
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Can a symbol appear more than once?
Yes. That is by design. If a symbol conforms to more than one search, it increases the importance of the move and I am less likely to miss it.
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Do ETFs show up?
Yes, they do show up. However, I would encourage you to identify the source of the relative strength or weakness within the ETF and trade the stock.
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Are the symbols arranged in order?
Yes, the symbols are arranged according to dollar net change. For bullish searches, the biggest dollar gainers are at the top and listed in descending order. It is the opposite for bearish searches and the biggest dollar losers are at the top.
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Why is the time off?
The time reflects Pacific Standard Time (PST).
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What is the difference between Early and Confirmed?
An early search finds stocks that are “happening” now. Often there will be many results to sift through. Some work out, some don’t. As a trader I want to see everything and I’ll decide if it looks “right”. I like getting an early jump and taking the risk that it might not work out. On the other hand, some traders only want to see the trades that have made the move and are following through. From a programming standpoint I was faced with the dilemma of being too “open” vs. too “restrictive”. I was able to solve this issue by creating a new trade Type - Trigger. There is one other way I use this feature. Yesterday a stock from my Early searches may have been saying, “Look at me”. If I didn’t pull the trigger, the next day it may give me reminder in the Confirmed searches, “You looked at me yesterday and you didn’t do anything. Here I am again today…doing what I was supposed to — last chance”.
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Support
How can I change my password?
When you log in, stay on the Account page. Click on the word password, enter your new password, re-enter it and click “change”.
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How can I cancel a service?
Go to the Account page after you have logged in. In the lower right corner you will see a button that reads, “Cancel a Service”. Click it and boxes will appear next to your subscriptions. Mark the box next to the service you want to cancel and click “Cancel a Service” again. Once you do that you will see a red arrow appear. You can continue to use the service until it expires. Remember, to avoid being charged for the next period you must cancel 7 business days before the subscription expires.
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How can I change my e-mail?
Go to the Account page, click on the word e-mail, enter your new e-mail and click the Change button.
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How can I change my credit card?
To change your credit card information you will need to contact us by chat or e-mail. We will call you for the new information. Please do not send credit card information by chat or e-mail.
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Why won’t the charts work?
Chances are you have your pop-up windows turned off by your security software.
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Why haven’t I received any trades by e-mail?
The only correspondence we send by e-mail is a Trade Alert or an Update Alert. The e-mail contains a link to the log in area. You will need to log in and go to the appropriate report to view the research. Everything is posted to the website and trade information is not e-mailed.
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Why can’t I print the pages?
You can print the pages but they will not turn out well. I want to keep the site looking sharp and I’m not as concerned about how they look in hard copy. All of the information is archived and there should not be a reason to print it.
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Why can’t I log in?
It is possible that you are using the wrong e-mail address or password. Remember to add the .com or .net to the end of your e-mail address. If you continue to have problems, chat with us or send us an e-mail.
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Why do old reports show up when I go to the report?
This happens when the site does not recognize you as a subscriber. Visitors will see a past report when they surf the site. If you are a subscriber, you need to log in. Once you do so, the website will recognize you and the current report will appear by default.
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Why can’t I get into the trades?
There is probably a delay of some sort. It could be your ISP’s e-mail server or it could be that you are preoccupied and can’t react quickly enough. The alerts are time sensitive. If you are looking for a professional order desk that can help, try these two contacts. I’ve known them my whole career and they are considered deep discounters.
- Mike Cavanaugh (800) 599-5759
- Roger Mankus (800) 230-5570
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Why won’t your system take my credit card?
We accept all credit cards. If you have reviewed the information you input and it is accurate, your credit card company is blocking the transaction. Please contact them to resolve the issue. If everything checks out with them, chat with us or send us an e-mail.
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Can I use two e-mails for the alerts?
Not at this time.
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What happens if the system goes down?
In the unlikely event that there is a prolonged disruption, we will extend your subscription by the number of days we are down.
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Why do I get an error message when I try to sign up for the trial?
Chances are you have already registered and the system will not let you go through the trial again. We only allow one trial per person.
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Why doesn’t my password work?
Chances are the password is incorrect. Send us an e-mail or chat with us and we will reset it.
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Can I cancel the e-mail alerts?
For the Daily Report and Weekly Report — yes. Go to the report and uncheck the Notify Me box in the upper left panel. There is no way to cancel the alert e-mails for the option reports. The information is very time sensitive and we want to make sure you get it.
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Why didn’t I get the last trade alert?
For the Daily Report or Weekly Report you might have unmarked the Notify Me box. For all of the reports, it is possible that your ISP is having e-mail server issues. I test my e-mail servers and if there are issues on my end, I will let everyone know.
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Can I go through the trial again?
We limit the trial to one per person. In all fairness, 5-Days of access to everything we offer is plenty of time to evaluate our services.
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