3-17-15 Trading Strategy

3-17-15 – Trading Strategy

 

Current Holdings


Real time portfolio updates are now available here

3/13/15 – INDL (India) @ $96.81
3/13/15 – JPNL (Japan) @ $52.80
3/16/15 – EPV (Inverse Europe) @ $58.51

 

Today’s Updates


– Markets are showing a bit of strength on the rebound. Much different than last week in which the downward movements from Friday continued onto Monday. Volatility continues and the stocks on the watch from last week are still holding on to gains. Focus now is on some other possible opportunities.

Market Snapshot 3-16-15

EPV (Inverse Europe) filled @ $58.51

– Morning gap down got a better entry, however that was the high for the day. The gap can help or hurt and it’s a 50/50 chance on the open. I prefer to have some profits built in on day one, but that’s not always possible. Fortunately, none of the signals changed as a result of the down day.

  • PPO is still up
  • Price is above the 20-day moving average (if it drops below I’ll need to sell since this is a counter trend move)

One of my subscribers introduced me to a nice leveraged ETF Chart of Crude Oil. Crude and Natural Gas are very similar markets which is why I only pick one. However, I’ve decided to add Crude to my analysis of the “Energy Sector” to use as an option when investing in that sector. What this means is I will choose either Natural Gas or Crude as possible trades, but never both at the same time. This is very similar to investing directly in Gold or Gold Miners, one but never both.

Stocks on the Watch


DWTI (Inverse Crude Oil) 

– Despite Natural Gas staying in a fairly clear sideways movement, Crude has just hit a breakout. It’s too far past a buy point for this sideways consolidation breakout as of today, but it’s one to jump in on if it corrects back close to it’s original buy signal.

DRN (Real Estate) 

– After watching the long correction, we have a new signal today. I would normally wait until it crosses all 3 moving averages, but because PPO is up sharply, price has broken out of it’s downward trend, and we’ve broken the 20-day EMA, I think getting in on this a day early is acceptable. I’ve been missing a few opportunities because of the gap up after the buy signal is recognized. This means I can either buy the opening gap, or try to get in a day earlier.

Current Holdings with Open Orders for 3/17/15


Sell INDL (India) Limit @ $109.20 (12.8% Profit)
Sell INDL (India) Stop @ $93.15 (3.73% Loss)

– Decent move up today. Moving up my stop to just below Friday’s low.

JPNL 3-16-15

 

Sell JPNL (Japan) Limit @ $56.50 (7.01% Profit)
Sell JPNL (Japan) Stop @ $51.00 (3.41% Loss)

– Moving up my stop close to today’s % gain.

JPNL 3-16-15
Sell EPV (Inverse Europe) Limit @ $60.00 (2.55% Profit)
Sell EPV (Inverse Europe) Limit @ $57.00 (2.58% Loss)

– Better entry due to today’s morning gap down, but certainly didn’t close where I wanted. I’m only going to allow it to go down half the daily ATR of $1.51 or 1.3% further. If this is going to go up, it shouldn’t go down two days in a row before I know I’m in the wrong.

EPV 3-16-15

New Open Orders for 3/17/15


Order Cancel Order

Buy DRN (Real Estate) Stop @ $85.05
Buy DRN (Real Estate) Limit @ $82.25 

– If you have never seen a “Stop Buy” order, this is an order that will immediately buy at the current market price if the price is at or above $85.05 in this case. Here are the difference scenarios covered.

  • Price gaps up above today’s high of $85.03 then I’ll be in at the market
  • If price opens lower, but not low enough to hit my limit order, then goes past $85.05 I’ll be in
  • If price goes low enough to $82.25 then I’ll get in lower

Either way, if the stock moves too high or two low I’ll be in, otherwise if it stays in between $85.05 – $82.25 then no trade will take place.

  • Price has broken out of it’s downward trend lines
  • Price is following the longer term up trend
  • PPO turned upwards today
  • Price is above the 20-day moving average in Purple (I like to see it above all 3, but to account for everyone else seeing the same signal and causing a morning gap, I’m getting in a day earlier)

There is no same day sell order with this type of order. That is fine since DRN is a long trending stock anyway.

DRN 3-16-15

 

Buy SOXL (US Semi Conductors) Limit @ $151.20
Sell SOXL (US Semi Conductors) Limit @ $160.50 (5.52% Profit)

  • Nice bounce off the 50-day EMA in Yellow from Thursday
  • Price crossed over the 20-day EMA today in Purple
  • Price is back in it’s long term uptrend
  • PPO turned positive today

SOXL 3-16-15

 

Buy UGAZ (Natural Gas) Limit @ $2.35
Sell UGAZ (Natural Gas) Limit @ $3.05 (29.79% profit)

  • Natural Gas is in a sideways correction, so this is buying on the bounce if it hit’s it’s bottom trend line which has been showing strong support lately

UGAZ 3-16-15

Buy DWTI (Inverse Crude) Limit @ $141.27 
Sell DWTI (Inverse Crude) Limit @ $173.95 (23.13% Profit)

– Price has already broken out from a clear consolidation pattern, however, I’m willing to buy a quick correction if it will get this low. I’m doing the same for Natural Gas, so I only expect one of these to hit.

Most likely this move is already well established and could keep moving up. However if markets are volatile enough there may be a second chance.

DWTI 3-16-15

3-16-15 – Trading Strategy

3-16-15 – Trading Strategy

 

Current Holdings


Real time portfolio updates are now available here

3/13/15 – INDL (India) @ $96.81
3/13/15 – JPNL (Japan) @ $52.80

 

Today’s Updates


INDL (India) filled @ $96.81
JPNL (Japan) filled @ $52.80

This has been an interesting week. I’ve been correct about the direction and signals of many markets this week, but my downfall has been my entry points (not willing to go in at market, or putting in orders too low for entry) and setting my stops too low (only to get stopped out and return quickly for continued profits).

Here is a recap for this week:

** Disclaimer, possible returns obviously don’t reflect reality, but it does clearly point out that I need to adapt my entry strategy and my stop loss strategy because the potentials were clear and I missed out this week on very profitable opportunities. **

I signaled a buy in BZQ (Inverse Brazil) on 3-6 to buy on the following Monday 3-9. Total move so far could have been 16.97%.

  • Ideal entry would have been an OCO order (Buy Limit or Buy Market if it goes higher than the day’s previous close

BZQ 3-13-15

DRV (Inverse Real Estate) – This one was played correctly, so far, I got out before a major drop, but looking at the chart of DRN (Real Estate, we are bouncing off the top of the longer term trend line. So next week it could easily continue it’s downward movement, thus returning DRV back higher.

DRV 3-13-15

Here is the current chart of DRN (Real Estate) and it’s clear we have another bounce off the top of the long term downward trend which still justifies a position in DRV (Inverse Real Estate)

DRV 3-13-15

JNUG / JDST (Junior Gold Miners & Inverse Junior Gold Miners) – This one was a punch in the face.

Called for a buy in JDST last Friday, but missed due to my entry being too low

JDST 3-9-15

Stopped out prematurely on JNUG due to my stop loss being too low.

JNUG 3-13-15

Stopped out of RUSS (Inverse Russia) prematurely due to a stop loss being too low. My stop was $13.55 and the low for the day was $13.48 just 7 cents under my stop.

RUSS 3-13-15

 

  • As you can see, identifying a good trade setup is not the concern
  • It’s how you manage the trade that matters most
  • It’s a constant battle of risk vs reward and in volatile markets you have to force yourself to take on more risk and even though my rules and strategies on how to identify trades hasn’t changed, I have to adapt my entries and exits based on current market conditions which always change.

 

Current Holdings with Open Orders for 3/13/15


Sell INDL (India) Limit @ $109.20 (12.8% Profit)
Sell INDL (India) Stop @ $92.00 (4.97% Loss)

INDL 3-13-15

 

Sell JPNL (Japan) Limit @ $56.50 (7.01% Profit)
Sell JPNL (Japan) Stop @ $49.80 (5.68% Loss)

JPNL 3-13-15

New Open Orders for 3/13/15


Buy EPV (Inverse Europe) Limit @ $58.80
Sell EPV (Inverse Europe) Limit @ $61.60 (4.76% profit)

  • EURL (Europe) is below all 3 moving averages
  • PPO is negative
  • Price has made a slight pull back which will allow for a continued downward movement

EURL 3-13-15

Where I want in on EPV (Inverse Europe)

EPV 3-13-15

 

 

3-13-15 – Trading Strategy

3-13-15 – Trading Strategy

 

Current Holdings


Real time portfolio updates are now available here

– No current holdings

 

Today’s Updates


DRV (Inverse Real Estate)  stopped out @ $24.40 for a 2.28% loss
RUSS (Inverse Russia) Stopped out @ $13.55 for a 4.58% loss

– It’s rather clear that my stops have been too conservative. For today, the DRV stop was beneficial because it kept me from a 4% loss, but RUSS recovered at the end of the day and would have been even, but I was stopped out before.

This in combination with yesterday’s trade in JNUG (Junior Gold Miners) stopping out early means volatility is increasing and I need to be accounting for that with my stop losses.

From looking at the markets, they may not be making strong down moves yet as many are climbing back, albeit slowly, from the dramatic drop from last week to early this week. It’s been very unpredictable.

market snapshot 3-12-15

Current Holdings with Open Orders for 3/13/15


– No current holdings

New Open Orders for 3/13/15


Buy INDL (India) Limit @ $102.14
Sell INDL (India) Limit @ $109.20 (6.91% profit)

  • Clear bounce off the 100-day EMA in Orange
  • PPO turned up today with a large gap up

INDL 3-12-15

Buy JPNL (Japan) Limit @ $52.80
Sell JPNL (Japan) Limit @ $55.95 (5.97% profit)

  • Continuance trade, price has bounced off the 20-day moving average
  • Price has exceeded it’s previous price high
  • Price continues to follow the longer term trend upward
  • PPO went positive today

JPNL 3-12-15

Buy RUSS (Russia) Limit @ $13.75
Sell RUSS (Russia) Limit @ $17.15 (24.73% profit)

– Still bearish on Russia, none of the indicators have changed, I just set my stop too low. Might as well try to get in at a better price if possible.

RUSS 3-12-15

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