1/23/15 – Trading Strategy
1/21/15 – EPV (Inverse Europe) @ $62.70
1/21/15 – EWJ (Non Leveraged Japan) @ $11.35
1/22/15 – EDC (Emerging Growth Markets) @ $25.00
– EDC (Emerging Growth Markets) filled @ $25.00
I only follow the news on Central Banks, Governments and Wars. The big news was Europe’s official confirmation of their QE bond buying program similar to what the US Fed did for the past few years.
This explains why EDC is moving so well and why EURL (Europe) has been up for 8 straight days now. This news didn’t help my position in EPV (Inverse Europe), but I believe this could very well be a “buy on the rumor, sell on the news” because 8 days in a row is very difficult for any market to hold without some sell off. I’ll either be able to get out of EPV near even or a small profit. Long term though, I’ll be looking to get into EURL as this long term down trend should end. Markets love when the government prints money and the EU has just committed to doing so.
– India (INDL/PIN) and China (YINN) continue to run away like a rocket and I called for a buy on those early on, but was to conservative in my entries due to the volatility. However, with this new move in the EU, I imagine volatility will slow and trends will form. This is where the real money can be made.
EDC (Emerging Growth Markets) does have a good percentage of it’s portfolio in China, so the fact I missed out on YINN is okay since I’m getting a good portion of it with EDC.
Here is the link to Direxion’s EDC Holdings (Click on Target Index):
Current Holdings with Open Orders for 1/23/15
Sell EPV (Inverse Europe) Limit @ $63.50
Sell EPV (Inverse Europe) Stop @ $60.40
– Same order as yesterday, but I’m lowering my sell limit to take a small profit. I won’t move my stop any lower. Today’s low was $60.83. The news about the EU policy is out. Hopefully now the news it out the profit takers will try to unload their positions to those who want to capitalize now on the news.
Sell EWJ (Non Leveraged Japan) Limit @ $12.00
Sell EWJ (Non Leverage Japan) Stop @ $11.25
– EWJ Moved up .05 today, so I’ll move up the stop by the amount. The low for the day was $11.35. I want to limit any potential loss on this position. I’m keeping my sell order high since I believe this could be a trend to hold on to.
Sell EDC (Emerging Growth Markets) Limit @ $28.15
Sell EDC (Emerging Growth Markets) Stop @ $24.35
– We are most vulnerable when we get into the trade. Today the position closed up 3.96% for the day. This is a 4 out of 4 on the B12 Trade Confidence Scale (Learn more about this in my Educational Series), but because it’s a pattern break out play I want to give it some room to wiggle before it takes off. Break outs can have sharp reversals to shake people out before they take off sharply, so I’m setting my stop position at 1.5x the daily ATR. I could still take a loss on this position if I get stopped, but I feel it’s worth giving some breathing room so we can take advantage of a much larger move.
Also notice in this chart I have mapped out my ATR Stop and ATR Limit lines. I’m charting 2x the ATR in green for my limit and 1.5x ATR in blue for my stop. This is discussed in my free video “Bonus Indicators for TC2000.”
Open Orders for 1/23/15
Buy JNUG (Junior Gold Miners) @ Market
Buy GDXJ @ Market
– Yes, I usually never do this, but here is my logic. JNUG didn’t drop to my $39.15 level today, and looking at it’s chart, in this recent uptrend, it doesn’t correct for more than 2 days. Normally, it will gap up on day 3. I do take a risk of it dropping after I’m in, but if I compare it to the chart of Gold and Gold is moving up much faster than Gold Miners.
JNUG is a very volatile stock with up to 16% daily trading range for the last week. I feel with the last two down days I’ve built in a safe enough cushion for myself, but if you don’t have the stomach for this kind of risk or the money, seriously consider GDXJ (Non Leveraged Junior Gold Miners) as an alternative. The charts are exactly the same.
Looking at the chart of gold, I am officially bullish on Gold. It’s moving up, and it’s moving fast! It’s broken out and held above it’s multi-year down trend for almost a week now.
Buy RUSL @ Market
– Another pattern break out. This is just like EDC, it’s gapped two days in a row now. It may gap lower or higher tomorrow, but I like these patterns so I’m jumping in. ** Disclaimer ** Just like JNUG (Leveraged Junior Gold Miners), this is a volatile market. RUSL (Leveraged Russia) has a daily ATR % of 9%. If that is too much of a possible swing for you, look at getting into RSX (Non Leveraged Russia).
I also like BRZU and possibly DGAZ, however, because I will be ensured positions in two more markets tomorrow, that hits my limit of 5.
I don’t like to be in more than 5 of any of the 12 markets at once because it starts to dilute my diversification. I’ll be managing positions from now on instead of entering new ones until they sell or I get stopped out.