ETF Trading Research 2/1/2018

Posted February 1, 2018

For those of you new here, I most of the time have the ETF Trading Research report out by 8PM PDT, and it comes by an RSS feed, but you can look at the report here sometimes before you get it in your mailbox; https://illusionsofwealth.com/category/etf-blogs/ This is also the same link if there are any technical difficulties.

Today’s Trades and Current Positions (highlighted in yellow):

Had a slow day overall with so much whipsaw going on. If we are trend traders, you’ll see that the nightly report last night wasn’t giving us much. But oil related did go green today with UWT and RUSL.

Economic Data For Tomorrow

Tomorrow we have Nonfarm Payrolls, and a bit more. Most occurs before the market opens.

http://www.investing.com/economic-calendar/

Stock Market

Ignored the stock market today and maybe for good reason. TVIX moved down to 5.99 pre-market, then up to 6.40, then down to 5.50 then up over 6 again. Could have made trades but I stuck with what I thought were the better odds trade without the whipsaw in oil. Stock market was up triple digits and fell all the way negative. See what we can trade tomorrow, but that was once again a big turnaround. UVXY did turn red on the weekly which has me a little cautious in it/TVIX.

Foreign Markets

Not liking these as no follow through.

Interest Rates

Looks like TMV had a bit more life in it. It did turn red on the weekly but today might have been it. We’ll find out soon. Rates have shot up pretty quick and the dollar falling is part of the reason.

Energy

Yesterday for oil I said I was “neutral to bullish right now.” Today that switched to bullish. It does show at least I don’t have a one track mind, and still stick with oil under 64. Yes, getting better at reading price action. We did well even with the volatility today where market makers tried to shake us out. UWT and GUSH should continue higher. UWT is now green on the weekly again and that’s a good sign for us.

Tried a trade in UGAZ early at the trend line if UNG but stopped out with small loss before the data which pushed UGAZ down quite a bit. 30% in 2 days. Small bounce may come, but tough to be a bull in nat gas till we get a better sign.

Precious Metals and Mining Stocks

Today JNUG and JDST switched places quite often but gold got a late run with the dollar weakness and we are right back to where gold was last Friday. JNUG could easily take off now, especially if the dollar falls further. We should know soon. I still say whatever opens positive tomorrow, buy, but glance over at the dollar and make sure it agrees. I will however take special note that UGLD turned green on the weekly today. I say special in that first time in awhile, gold is leading silver. Which means if USLV opens positive tomorrow, it may be good as it has catching up to do. However, please look at the dollar for confirmation. Below 88.15 and metals can fly I think. But I hesitate using the word fly loosely. Dollar still is in low sentiment area and a bounce can always come. Doesn’t seem to be on the Fed’s agenda though does it. Nor Trumps I don’t think.

Thursday Night Price

Wednesday Afternoon Price

Tuesday Afternoon Price

Monday Night Price

Friday Night Price

Green Weekly’s

These are the ETFs that have turned green on the weekly and show a trend has developed. Your best way to profit with the service is stick with the green weekly trend each day and take profit while using a trailing stops. Also, if these green ETFs are up for the day at the open, they offer the best scalping opportunities. I am always fine tuning this section so if there is confusion at all, email me and be specific and I’ll be happy address.

I know I have said this many times but it is worth repeating; If you stick with the green weekly trades your odds of profit increase as there is more risk with the day trades. I call the day trades with the intent of catching some runners, so will get a few 1% stop outs but eventually catch the 5% to 10% or more runners. The important part of the list below is that the longer the ETF stays on the list the more likely it is to turn red on the weekly and the opposite ETF comes into play as a long. This will be tracked more when we automate the service.

Sell half shares on a spike up on any ETF you are long, even if goal is higher. Spikes higher are almost always followed by moves in the opposite direction. Try and get out with a market order quickly before the quick move back lower. Lock in that profit!

Wait for the sign of a positive day to go long anything beaten down, I think the odds swing to your favor.

New way to trade beaten down ETFs; The way that trade would work, and I really think it should be a rule from now on NOT to trade anything trending down until it reverses, is we would buy at the open if it is POSITIVE or GOES POSITIVE during the day. Then we would look to profit on 1/2 shares over and over, day after day until we get the red weekly signal on the opposite trade that could turn into bigger profits. The stop would be if it goes negative for the day. The rule of keeping a stop if it goes negative for the day is a must. Lastly for this type of trading we need to not be afraid to get back in if it goes positive once again. Sometimes market makers will take an ETF negative and then reverse it right higher again because they know if it goes negative many exit. So we have to be willing to risk a few in and outs when it does this up and down move around that potential stop out area so we don’t miss the ride back up. That’s just part of trading and not a big deal. But no matter what, if it breaks to yet another lower low because you didn’t get out after giving it a little more wiggle room, you are more than likely further from the original stop out when it went negative and you are out, waiting for it to go positive again before you get back in. You are simply buying into strength.

Doug Eberhardt