ETF Trading Research 4/16/2018

Posted April 16, 2018

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

It’s easy to take a look back at the day and analyze the thing you should have done.

Today I should have got us in 1/2 shares RUSL just in case the news of sanctions was already priced in. As it turns out, Trump said there would be no new sanctions. Since BRZU and YANG were beaten down I decided to get us in those and if they fall we will ride them up.

With the uncertainty in Syria, I saw DWT moving up and thought DRIP would move up with it. It did not. I can’t complain about it but just accept it and get it back on a future trade. I wrote about this trade setup in last night’s report and I still think if DWT and DRIP are higher they are worth going long as eventually that dang DRIP will turn. Too wide a stop on it today though. Once it broke the low of the day it should have been it, and quite possibly going from positive to negative too.

I did well by getting out of USLV but JNUG I didn’t keep the stop at break even when I thought we might move lower. It was supposed to be a scalp and should have made the call pre-market at 15.20 so we could have sold 1/2 on the morning move up and then keep the stop at break even.

So little things to start Monday where normally I trade slower.

Big move down in sentiment in dollar, oil and VIX. Also note that with that dollar drop, gold and silver did nothing. I thought when the dollar fell, commodities went up? Not today.

Economic Data For Tomorrow

Building Permits and 5, yes 5 Fed members speaking tomorrow. If you had a balance sheet like the Fed’s to defend, you would be out every day as they have been speaking to assure everyone all is well.

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

Stock Market

I am clear about one thing and that is I think the market moves higher. We have had a ton of whipsaw the last few weeks but I am concentrating on buying dips now. While we sold RUSL for 10% once, it would have been nice to be back in after the announcement Sunday that got us stopped out today. This White House is somewhat driving me nuts. So let’s stick with the bullish trades and we’ll be patient on DWT/DRIP/TVIX for the best setups.

Foreign Markets

We should start to see the run in YINN, BRZU and RUSL I think soon as they move up with the U.S. markets. I look to buy the second half shares lower if we can and also RUSL. I have not traded these much the last month and you’ll notice I am dipping back in them again. I think the bigger moves can be had here along with TQQQ and LABU versus FAS and SVXY.

Interest Rates

TMV won out today and I think will win out as the market moves higher too.

Energy

Yesterday I said; “I more than likely would still go long DWT or DRIP if they ever open positive, simply because of their ability to explode higher.” While I sent 1/2 shares in DWT I should have done the same with DRIP knowing its track record of trading it when positive. I still think the risk vs. reward is with them but we need UWT to turn red on the weekly first as well as GUSH for any run.

UGAZ I like and can let it fall a bit before the move higher to 2.80/2.90. It’s due for a little bit of a run.

Precious Metals and Mining Stocks

Dollar lower today and USLV and JNUG both came off their morning highs. Very odd behavior that makes me want to trade JDST and DSLV possibly tomorrow. End of day move up in JNUG though could still indicate a move higher. Have to see what that darn dollar does and if metals will trade opposite. I can still trade either side, but I did at least stay away from JDST today and didn’t get trapped end of day. Was an easy trap to fall into.

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.

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.

Doug Eberhardt