You can’t make winning trades if you don’t know what to trade.
Just like anything else in trading, building a watchlist requires a process.
I have a 3-step process I’ve used for years that’s helped me find an average of 3 100% winners every single week.*
But first, let me temper your expectations…
When I walk you through this process, you’re going to think it’s too easy.
You’re going to be like, “This guy’s a moron. How does he ever do well at this? If he can do it, I can do it.”
You’re right about the last part. But the first part just might be your Achilles heel…
If you think my process is too simple, too easy, too basic … you’re overcomplicating it.
In my Options Income Trader workshop yesterday, I called out a trade on Cisco Systems Inc. (NASDAQ: CSCO): one ticker, one timeframe (five-minute), one indicator (VWAP) …
300% gains in 1 day.*
On April 23, I sent out an email picking four names from my Dynamic Watchlist. One of my picks was Intel Corporation (NASDAQ: INTC) May 8 $80 calls.
When I sent the email, the calls were trading for $1.38. Last Friday, they hit $49.31 per contract before expiring.
That’s a 3,472% (35x) peak gain in 2 weeks.*
And both those trades started in the simplest place imaginable…
By putting those names on my watchlist…
Step 1: Classification
If the market is in a bullish trend, our watchlist names should be bullish as well.
Shocker.
Ideally, those names should also be in bullish sectors.
The market can be ripping while, say, XLU isn’t trending, and you’re stuck wondering why your utility calls aren’t moving.
So:
- Bullish market: The major indexes are moving higher
- Bullish sector: The sector is strong as a whole
We want the wind at our backs from both the sector and the overall environment.
Step 2: Definition
But we need to define what “bullish” means.
My definition: the 8 EMA is over the 21 EMA, which is over the 34 EMA (on the daily chart).
The EMAs should look like this:
I want names where that’s true, in a sector where that’s also true.
Step 3: Timing
Once you know what you’re looking for and you’ve defined the criteria, the next question is:
Where do you buy it?
For me, I buy according to my risk rules:
- At the 8 EMA: some.
- At the 21 EMA: more.
- At the 34 EMA: most.
Why? Because my stop-out is right below the 34. So I can buy the most at the lowest place and still be okay. If I get stopped out, I get out. I haven’t mentioned VWAP yet. I have a whole separate monthly VWAP strategy I can teach you.
So the full watchlist criteria: names in bullish trend, in sectors in bullish trend, where the price comes back down to my risk zones.
Literally … that’s it.
Start running this process on the names you’ve been watching.
Now let me show you the ones I’ve been watching…
My 4 Name Watchlist
These are the four setups I narrowed down this week:
XYZ June 18 $75 Calls
Block, Inc. (NYSE: XYZ) is in trend with a pullback into the zone. The best place to buy would’ve been around $68.70. I missed it. I’m putting an alert at $70. On any pullback to $70 (specifically $70.10 or below), I want to look at the June 18 $75 calls. Let me check the options scanner for smart money confirmation. Over the last seven days, I see the $72 calls and some puts. I want to play a bullish name in a bullish way. The 6/18 $70 puts and 6/18 $80 calls show up, but at the bid. Not a ton of money confirming, but it does look good.
CRCL June 18 $150 Calls
Circle Internet Group (NYSE: CRCL) just had good earnings and pulled back today. If CRCL can pull back to the $119–$120 level, I’ll be your huckleberry. I’m setting an alert at or below $120. Looking at the chain, I like the June 18 $150 calls. I’m setting an alert at or below $120.
CSIQ Jan 15, 2027 $20 Calls
Canadian Solar Inc. (NASDAQ: CSIQ) is intriguing. Earnings dropped, there was a nice bounce, and now CSIQ is back to this level. The 115/120 calls are interesting. Over the past month, the 115/120 calls have had good action. Looking at the weekly chart, that’s not too bad. I’m putting an alert above $20 for the Jan 15, 2027 $20 calls. It doesn’t look too shabby.
ZM June 18 $100 Calls
Zoom Communications (NASDAQ: ZM) has a beautiful chart. ZM is in trend, pulling back to the 21 EMA. Looking at options: the 6/18 $120 calls. There’s good volume across the chain. I like the idea of this pulling back to fill the gap around $97.15. Ideally, I want it at $93, but I’ll set two alerts: one at $94.60 and one at the gap fill around $97.10. On a pullback to either level, I’m playing the June 18 $100 calls.
That’s it. We just made a watchlist together.
Now go make some killer trades.
Be good (and be good to others),
Ben Sturgill
*Past performance does not indicate future results
