ETF Trading Research 5/22/2018

Market did shoot higher overnight and broke 2740 but struggled the rest of the day until end of day when it had a 5 point rise off the bottom. Fed day tomorrow so expect more whipsaw but I want lower to try and get the last move higher before they try and pull rug again. 2750 to 2780 is the target and I’ll try and find a point to go short there now. But until then, LABU, TQQQ and SOXL are the trades. Got a little from LABU today.

BRZU I said yesterday I should have called it once it went negative and then positive again. It was up over 7% today. Mixed market in the others as the dollar rebounded and YANG and RUSS moved up with it. No calls at present, however on a dip in BRZU, RUSL and YINN we will be buyers once dollar shows weakness.

I said yesterday that GUSH and UWT were hitting extremes and it continued into today, but we got the big reversal in DRIP primarily and small reversal in DWT. After hours, the data came in negative for oil. This bolsters our chance at a profit tomorrow if we can get the run higher with bearish storage data.

 

Going against the green weekly is a mistake but we’ll get the rebound. We might though head lower first but after hours some decent price action. I don’t 100% trust the after hours pricing though. 2.95 is our target for the extreme price for a reversal.

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!

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.