9-1-15 – Trading Strategy
Real time portfolio updates are now available here
8/28/15 – DGLD (Inverse Gold) @ $81.00
8/28/15 – TMV (Inverse 20+ Year Treasury Bonds) @ $28.42
8/31/15 – DWTI (Inverse Crude) @ $97.00
DGAZ (Inverse Natural Gas) sold limit @ $6.50 for a 7.62% profit
DWTI (Inverse Crude) limit order filled @ $97.00
It appears the major reversals are losing steam and looking at today’s movements compared to their 7-day ATR % many were on average for the day. This means the movements aren’t significant enough to call for a full blown decline and looking at today’s charts these movements were rather expected. I think this will still take a few more days before there is confirmation a second leg down is occurring or if prices will continue to climb reclaiming their recent losses.
One highlight today was INDL (India). This is a very low volume stock so I wouldn’t recommend trading it, but PIN (non leveraged India) is a good alternative. It appears to be setting up for a good short possibility. Another down day tomorrow larger than today would be a good confirmation this market is ready for shorting.
Unfortunately there are no inverse ETFs for India so this would have to be a short play.
Also of interest is RUSL (Russia) which has had it’s 5th positive day in a row and has now hit the top of it’s upper downtrend line. I would like to take a stab at RUSS (Inverse Russia) as I think this is due for a reversal, but I want to wait another day to get confirmation that we are going to fall back into this downtrend and this isn’t the start of a new breakout.
Current Holdings with Open Orders for 9/1/15
Sell DGLD (Inverse Gold) Limit @ $83.00 (2.47% Profit)
Sell DGLD (Inverse Gold) Stop @ $80.00 (1.23% Loss)
Gold barely moved today which concerns me. If I’m bullish or bearish on a position I want it to be in a trend and continue to move after I enter it. The fact it declined slightly has be worried we may move into a sideways movement and or I might be losing my directional edge. I’ve moved up my stop to $80.00 and lowered my limit order to $83 in case this market goes sideways.
I will check on the price of gold about midnight PST to see if there are any big movements, if so I may increase my limit order, if not it will stay the same for tomorrow.
Sell TMV (Inverse 20+ Year Treasury Bonds) Limit @ $30.50 (7.32% Profit)
Sell TMV (Inverse 20+ Year Treasury Bonds) Stop @ $28.50 (.28% Profit)
TMF (20+ Year Treasury Bonds) made a nice drop today after testing the $80 resistance level this morning. In fact, TMV (Inverse 20+ Year Treasury Bonds) dropped as low as $28.20 and my stop was at $28.10. I’m bumping up my limit order only slightly because I think there will be a decent move tomorrow, but not so far away that it would take days to hit. I’m worried about these markets going sideways and would rather cash out with gains than wait through a choppy mess.
Chart of TMF (20+ Year Treasury Bonds) testing support again before closing lower.
My orders for TMV (Inverse 20+ Year Treasury Bonds) for tomorrow
Sell DWTI (Inverse Crude Oil) Limit @ $110.00 (13.40% Profit)
Sell DWTI (Inverse Crude Oil) Stop @ $94.00 (3.09% Loss)
I am keeping a very tight stop on this. The purpose of this trade was to catch the extreme volatility. On these types of trades the profit is made by getting in at the best price. I was pretty close to the close of $95.75 with my $97 entry. After this much upward movement in UWTI (Crude Oil) for the last 5 days I’m expecting this to be a gap down in the morning causing DWTI (Crude Oil) to be profitable out of the gate. If it’s not, then I will quickly be stopped out.
Since Oil futures trade 24/7, I can check on this before turning in for the night gauge how this trade might do tomorrow. I will send out any updates if necessary.
Chart of UWTI (Crude Oil) on his 5th day of extreme price increases
My orders for tomorrow in DWTI (Inverse Crude Oil)
New Open Orders for 9/1/15
No new orders for tomorrow. I don’t see anything in the charts that screams a great setup for tomorrow.