Monthly Archives: January 2016

1-25-16 – Trading Strategy

1-25-16 Trading Strategy

What I’m in


1/22/16 – GASL (Natural Gas Companies) @ $3.44
1/22/16 – EWJ (Japan) @ $11.29
1/22/16 – RUSL (Russia) @ $7.97

What I’m selling


Sell EWJ (Japan) Limit @ $11.75 (4.07% Profit
Sell EWJ (Japan) Stop Limit @ $11.05 (2.13% Loss)

Sell GASL (Natural Gas Companies) Limit @ $4.50 (30.81% Profit)
Sell GASL (Natural Gas Companies) Stop Limit @ $3.15 (8.43% Loss)

Sell RUSL (Russia) Limit @ $9.85 (23.59% Profit)
Sell RUSL (Russia) Stop Limit @ $7.50 (5.90% Loss)

What I’m buying


  • No new orders for Monday as I have loaded up on the market close today

Today’s Updates


Market Snapshot 1-22-16

I was filled on 3 orders near the end of the trading day as I announced in my intraday email 2 hour prior to the close of the market today.

Today was the kind of day you look for as a potential bullish reversal. This is not a market to be messed with as these double digit gains across the board can be very very risky or very lucrative. I am sharing my trading experience with others on this blog so they can learn how I approach markets and how I trade with my own money. I want to caution everyone on following on this one. These volatility moves can be very dangerous so if you are not experienced enough yet, don’t play in these conditions.

I was still able to close out 2015 profitable despite taking on big risks, and I’m willing to do it on this considering the rare historical occurrences of such extremes.

 

What I’m Watching


SOXL (US Semi Conductors) broke above it’s $18.00 support level today. This is a bullish sign as well. We are sitting on 4 days up in a row now, so it may come back to test before it moves higher. Also PPO hasn’t turned over and volume wasn’t as high as it has been recently so I didn’t want to speculate on this one just yet.

SOXL 1-22-16

SPXL (S&P 500) broke out of it’s sharp down trend channel today which is the first bullish sign. I’ll wait of PPO to turn positive as we have a clear pivot bounce off of $58.00.

SPXL 1-22-16

UGAZ (Natural Gas) – I was stopped out for a small profit this week because the decline just didn’t run as long as I was hoping for. We’re now playing around with the $1.85 marker, but if PPO turns negative after going down further from 1.85 then I will most likely take another position in DGAZ (Inverse Natural Gas)

UGAZ 1-22-16

VGK (Europe) broke out of it’s downward trend channel today which could be a good sign for a stronger reversal next week. We’re nearing the 20-day EMA and a PPO turnover to the upside could be following soon as well.

VGK 1-22-16

 

What I’m Selling


Sell EWJ (Japan) Limit @ $11.75 (4.07% Profit
Sell EWJ (Japan) Stop Limit @ $11.05 (2.13% Loss)

Japan crossed up above it’s previous support level of $11.15 after an extreme drop below. Getting in at close today provides me a safe 2% stop loss just below that level. The volume going into it today was over 3x the average volume. PPO didn’t turn up, but I like the 2% risk level and volume indicated there is very strong momentum going into this. My goal is to only hold onto this for 1-2 days tops and get out as I don’t want to rely on this being a long term bounce.

EWJ 1-22-16

Sell GASL (Natural Gas Companies) Limit @ $4.50 (30.81% Profit)
Sell GASL (Natural Gas Companies) Stop Limit @ $3.15 (8.43% Loss)

This is an extreme PPO turnover play. GASL has been on a very sharp freewill and PPO has turned over on 2x the average volume. If there isn’t any bad news over the weekend this could turn out to be a very big pop. The PPO turnover is something I discuss in detail in my Educational Series. It doesn’t happen very often, but it’s a higher probability setup and the conditions are perfect since we are seeing this reversal across the globe as well.

The ATR of GASL is off the chart though. Daily up/down movement can be as high as 20.99% currently. I can’t justify putting a stop with a risk level that low, so I’m putting it just below today’s low.

The risk is if Monday’s volatility causes me to be stopped out it could gap and go higher. I just can’t take the risk of letting it go beyond my risk tolerance level as this could easily go 20% against me and I just can’t let that happen. So there are risks in this trade, but the risk/reward of this trade are too much for me to give up trying. I’ve lost 8% on trades that I didn’t think had nearly this potential.

GASL 1-22-16

Sell RUSL (Russia) Limit @ $9.85 (23.59% Profit)
Sell RUSL (Russia) Stop Limit @ $7.50 (5.90% Loss)

Russia also had a PPO turnover to the upside today due to UWTI (Crude Oil) going much higher. I’m looking for one good day on Monday to most likely exit my position, but with the potential daily gains being as high as they are I will have to watch this closely intraday. The fact we filled the gap today that took us lower last week is also a key bullish sign. I’m not expecting a multi day rally, but if you can see that PPO can stay positive in a bullish position for a good enough amount of time for a profitable trade.

My stop in this position is much like it is in GASL. I can’t let it drop all the way down to $7.00 if there is another gap fill to the downside, I’m having to set my stop at a place that would invalidate the upward momentum. However, today had the largest amount of volume go into RUSL since April of 2015. This is a high % setup.

It’s very depending on crude oil, so I’ll be watching the futures market on Sunday to get a feel for how things will open on Monday.

RUSL 1-22-16

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1-22-16 – Trading Strategy

1-22-16 Trading Strategy

What I’m in


  • No current positions

What I’m selling


  • No current positions to sell

What I’m buying


No new buys for tomorrow. I’m waiting for PPO turnovers in these extreme down market conditions to signal the bottom reversals.

Today’s Updates


Market Snapshot 1-21-16

The markets are forming a possible bottom with a large number of markets finishing in the green today and others only showing minimal losses. There wasn’t enough movement to confirm a bottom, but the swings in direction from up to down are whipping traders around as a new floor is being developed.

I know what mistakes I made and I paid for them. Trading SPXL (S&P 500) and DRN (Real Estate) on a 1am discovery that the markets were rallying overnight wasn’t the best choice. Making trading ideas when you are exhausted seldom is. However, this market will provide many opportunities to make this back and then some so I’m not concerned about this short term drawdown.

I was stopped out of DGAZ (Inverse Natural Gas) today @ $14.60 for a .21% Profit

 

I’m certainly happy I didn’t take a loss on this trade, but at one point I was up over 15% or $3,000 on this trade. I’m currently in the negative this month over $3,000 so cashing out near the top of this trade could have kept me even. I’ll have to wait and look back if I should have based my trade on my losing trades or taken it as an individual trade that I thought could return a longer term gain. PPO turned positive today which is the indicator I was waiting for to get out anyway, I thought it would have kept going on longer.

However, I’ll be watching this closely for a possible re-entry to the downside again later.

UGAZ 1-21-16

What I’m Watching


GASL (Natural Gas Companies) is on fire. Yesterday’s intraday movement was almost 40% from high to low. Today’s close was up another 28.82%. It still wasn’t enough to turn PPO to the upside, so it’s still a coin flip if this is just a quick pull back for further downside movement or a bottom has formed. I’ll watch and wait for the indicators on this one.

GASL 1-21-16

SOXL (US Semi Conductors) has drifted back above a key short term support level of $18.00 that it gapped below and has now filled. PPO hasn’t turned up, but I will jump in at end of market day if it does.

 

SOXL 1-21-16

 

 

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1-21-16 – Trading Strategy

1-21-16 Trading Strategy

What I’m in



1/14/16 – DGAZ (Inverse Natural Gas) @ $14.57

What I’m selling


Sell DGAZ (Inverse Natural Gas) Limit @ $18.00 (23.54% Profit)
Sell DGAZ (Inverse Natural Gas) Stop Limit @ $14.60 (.21% Profit)

What I’m buying


No new buys for tomorrow. I’m waiting for PPO turnovers in these extreme down market conditions to signal the bottom reversals.

 

Today’s Updates


Market Snapshot 1-20-16

What a wild ride in the market today. Large opening gaps lower with a practical free fall until about 1pm EST, then a big rally turning some markets green for the day.

GASL (Natural Gas) Companies was down almost 25% today to close 11.71% higher by the close! This is a clear sign a bottom could be nearing, but I’m not letting my impatience push me in early again.

I use a special lagging indicator which works very well in these deep downward markets to detect reversals and that is the PPO (Price Percent Oscillator) which I discuss in depth in my Educational Series. I will be looking for that to flip positive to confirm we have a bottom reversal in play.

I was relying on luck to get me out of DRN (Real Estate) and SPXL (S&P 500) for a profit but I was stopped out anyway. Fortunately I didn’t take an even worse of a haircut as I managed to get out at my pre-determined risk level vs something much larger.

DRN (Real Estate) stopped out @ $63.00 for a 3.11% loss

It could have been much worse, but I had a stop limit order in which meant I wouldn’t sell for anything other than $63.00. I managed to get filled just moments before it plummeted another 5% for the day. I was lucky to get out for my predetermined risk level, but I shouldn’t have been in this trade anyway.

DRN 1-20-16

SPXL (S&P 500) Stopped out @ $62.50 for a 5.83% Loss

Today was a nail biter. The opening gap was lower than my stop and I saw my position down as much as 13.5% today! That is the only scary thing about stop limit orders is that open gap beyond your limit and it continues further putting you in a position to deal with a scenario you didn’t expect. I may not have been lucky in getting a profit, but I was lucky to get out at my predetermined level and I’ll take that. I shouldn’t have been in this trade either.

SPXL 1-20-16

 

What I’m Selling


Sell DGAZ (Inverse Natural Gas) Limit @ $18.00 (23.54% Profit)
Sell DGAZ (Inverse Natural Gas) Stop Limit @ $14.60 (.21% Profit)

UGAZ (Natural Gas) was up 4.68% today and I gave up about $1,000 in paper profits. This can have a dramatic psychological effect as you are watching your trades fluctuate in value. I am putting in a protective stop to prevent me from losing any money in this trade, but my goal is to ride this one out as it’s historically shown the down trends are rather long in UGAZ (Natural Gas) and the technicals are still clearly supporting continued downward movement.

At the same time, I don’t want to take a loss so I’ll set my stop to be slightly profitable and if I get stopped out I can always rebuy in when the trend continues.

Natural Gas inventories come out tomorrow so there could be some strong movement either way.

However, this is only one green day for UGAZ (Natural Gas) since I started playing it to the downside and the technicals still look good for further downward movement.

UGAZ 1-20-16

My order for tomorrow for DGAZ (Inverse Natural Gas)

DGAZ 1-20-16

 

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