ETF Trading Research 9/12/2018

Posted September 12, 2018

Nat gas did what we wanted it to today and you would have scalped a decent move for one day. SDOW I gave another shot but UDOW took over once the news came out from the White House that there might be a China deal on tariffs. That also hurt TVIX. News is part of trading but still have that lean a bit short right now. Just didn’t want to take the overnight risk. Also, no real signals to go on as TVIX is not part of my system and was a trade that I thought could move up with any breakdown in the markets as SOXS and LABD were taking off.

Metals and miners were the story today.

Gave some aggressive trades in GBTC and YINN where you could have got 1% or up to 4%.

Economic Data For Tomorrow

CPI tomorrow will be important for gold. If it comes in less than expected, can boost gold and vice versa. Initial Jobless Claims and ECB Conference. Also nat gas storage.

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

Stock Market

Still attracted to TVIX so keep an eye on it. Didn’t get going today with /ES and /NQ lower and VIX higher. PPI data was negative and thought we might get some action. LABU and SOXL were falling hard and did the day before too but not enough to trigger a green weekly and we had a reversal back up after White House news on Chinese tariffs that was “rumoured” to be positive.

Foreign Markets

Some of you

Interest Rates

TMF and TMV playing the trading places game again. No real interest here but TMV is green on the weekly.

Energy

UGAZ worked out well for us and DGAZ should take over, especially if data is bearish. Might be worth a speculative position before data for aggressive traders that you can add to.

Yesterday I said for oil; “Still has room to move higher with UWT hitting green on the weekly.” Data was bullish and it shot higher with GUSH, then fell the rest of the day.

Precious Metals and Mining Stocks

Might get a pullback at some point tomorrow in JNUG but if not in anything under 7.50 would be good pre-data. Post data it will be dependent on data and I’ll have to make a call then. But overall, green light as long as dollar stays under 95 and keeps falling. Watch silver for a bigger move and gold over 1220 as a key area. The red weeklies may get us more than a small move. The double down portion of these long the metals and miners ETFs are up from 1.5% to 5.17%. Whether or not we have another shakeout, I think that can simply be hedged with JDST rather than selling. Hopefully for now we just take off for a decent run. DXY breaks 94.50 it would confirm it. China agreements on tariff would help too. But it starts with CPI data tomorrow. Still in buy the dip mode overall.

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