Why trade the stock market using options?
Options can help you find the market direction, its a proven strategy that you can use to make money.
As a retail trader you can use these options to locate where the big money is going, ususally from large investment companies.
Options are placed only during market hours, outside of 9:30am EST to 16:00pm options cannot be placed.
Most options are placed for the current week which expire every Friday.
If your call or put didn't hit the strike point, it will expire and become void.
How do options work?
Lets say we are looking at ETF's, the most popular option is called SPY.
Which mimicks the SPX500 otherwise known as S&P500.
ETF's are Exchange-traded fund which bundles stocks, crypto, commodoties and other markets into one fund.
That is why when a large fund like SPY goes down/up, the rest of the market follows.
When you place a CALL, you are buying an OPTION, you think the option will go up!
When you place a PUT, you are selling an OPTION. you think the option will go down.
Lets say the current price for SPY is 300.
You place a put, at the strike price of 300. If SPY goes down, then you make money!
If SPY goes the opposite direction, then you are losing money.
It's explained very well on the following youtube video.
How to trade options on RobinHood
What are golden sweeps?
Golden Sweeps are the very large orders that dwarf the smaller orders, when you get these golden sweeps, its the equivalant of a fish following a whale.
If you go to the opposite direction of the whale, then you may end up meeting a shark!