ETF Trading Research 9/16/2018
Futures started off lower on Sunday and now have moved back to flat giving us an uncertain open. It all stems on what Trump does with the $200 billion in tariffs and what China’s response will be. If Trump follows through, the China will most likely retaliate some. This would be bearish markets and metals/miners and bullish TVIX where we are taking a little risk in owning some over the weekend. I am 100% fine with a stop out and re-entry this week in TVIX as I think a much bigger move down in the market is coming sooner than later. Our indicators still have us leaning slightly bullish but anytime TVIX is positive this week I think it becomes our number one play. If /ES can break 2900 then we’ll jump on some short possibly as the red weeklies trigger. Also, any move south will be short lived as I think we have one more leg up to 3000 in the S&P and we’ll try to time that with buys as well. This is not me playing both sides. I try to pick a few ETFs each day and buy the dips in them and sell the tops and have had more success with that strategy lately than the buy and hold strategy. That’s not part of my normal trading where we buy and try and profit for a day or more in something, but a new strategy that can work with ETFs that are positive for the day. If they go negative though, you have to switch to move onto something else. I won’t make day trading calls like that but on Friday you’ll notice I said I was buying the dips of DUST and selling the tops. We have seen several times where market makers like to take an ETF past the days low and reverse course and they did that with DUST. Knowing this I waited a bit longer on that breakdown in it and scooped up shares. If wrong, you just keep a stop at low of day but it paid off nicely.
My point is, you can practice this strategy with paper trading until you see that when we are in a range, like so many ETFs have been the past few months, you have to adapt your trading style if you want to make money. Thursday and Friday I tried this more and made $2000 on Thursday and $3500 on Friday. I am down on a TVIX hold $450 though on smaller shares of 1000 and we’ll see how Monday opens, but look at that chart. I am buying the dip and a move over 30 I think is coming. But I will stop out if I have to. The smart thing for you to do with TVIX is to trade it per the instructions above and don’t be afraid of it. At the same time, keep an eye on Trump’s moves on Monday out of the White House and also China’s response if he goes all in on the $200 billion in tariffs. If you see /ES or TVIX start to move one way really quick, you know it is related to this. If TVIX shoots up, sell the spike up at some point 1/2 shares and sit back and smile at the fact you will be taking profit no matter what. That’s what I am looking for. But I won’t frown too much if I get stopped out. I know a bigger move is coming soon enough or some other ETF mentioned below will make some profit for me. There is always another trade coming and my calls will be made with my system accordingly.
Let’s make it a good week!
Economic Data For Tomorrow
No big data for tomorrow. Wait for the trades to come to you.
http://www.investing.com/economic-calendar/
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!
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.
