Wednesday, January 11, 2017

ETF Day Trade: Weekly Options Trade using CUE Fine Tune

From the desk of Sagar Nandi and Superior Profit

​For Day Trading, Superior Profit Traders enter trade precisely at the right time using CUE Fine Tune Real Time chart. And they book profit with discipline. Sometimes, if the trade has not entirely played out, they may carry the trade forward to next day. All along, executing the trade following a pre-thought-out plan.

The two trades I took on DIA (ETF) in USA Market using Weekly Options on 3rd and 4th January 2017 are good examples of this Superior Profit Way of Trading Profitably. I will share the detail of these two trades below.

To begin with, I like to keep an eye on the Broad Market indices, futures or ETFs of the country I am trading. For USA Market, these are the three ETFs SPY, QQQ, and DIA.

​I had noticed earlier during off-Market hours that DIA was near Memory line in CUE Daily Hop On chart. I anticipated that the Memory might act as resistance and DIA might move sideways for a while or come down from the resistance; just long enough to make a Day Trade profitable.

​Here is the CUE Hop On chart of DIA at that time.

As you may also notice, DIA had displayed a Bearish Headwind signal on the Daily chart a few days ago. That further supported my short term Bearish view on DIA for a Day Trade.

Next, I looked at CUE Fine Tune 5 Minute charts of DIA, QQQ, and SPY.

​I noticed that DIA was the weakest. I observed this weakness by looking at the price movements of the three ETFs around the Fine Tune Pivot Levels.

CUE Fine Tune chart draws the Early Range Pivot Levels soon after Market Open. By looking at the Stock's move within or out of Early Range, we can see if it is Short Term Bullish or Bearish or Neutral.

If the Stock (or ETF) moves out of Early Range High, then the Stock is Bullish in the short term. And if it goes below Early Range Low, the Stock is Bearish in the short term. If the Stock moves within Early Range, then it is Neutral in the short term.

As seen from the Fine Tune charts below, DIA was not able to go above Early Range High. However, both QQQ and SPY went well above Early Range High in their respective charts. 

​​In Day Trading, if I am looking for Shorting a Stock or ETF, I tend to Short the weakest among related symbols. This principle (and the Memory Resistance in DIA Daily chart) lead me to take a Bearish Day Trade on DIA using Weekly Short Call Vertical. I used "Short" Vertical to have time decay in my favor. Below is the Risk Profile of this trade.

I tend to place Good Till Cancelled (GTC) profit booking order on a partial position as soon as my Trade Entry is filled. In this case, I did the same. And within 1 hour; as highlighted in the chart above; half position was closed with 50% profit.

At the end of the day on 3rd Jan, just before Market Close,  I looked up DIA in CUE Spotlight - which combines the Daily Hop On view and Intraday 5 Min Real Time Fine Tune view of the instrument.

This snapshot is shown below. I noticed that the Daily Candle was ending the day with a Bullish shape; with Long Lower Tail. And in the Fine Tune, 5 Min chart on the right, DIA had recovered significantly from Day's Low. As I initiated the trade as a Day Trade, and the day was ending with Bullish tone, I decided to close the remaining position at 25% profit. This trade resulted in a net profit of 37% on the full position within one day.

​The trade was taken as Short Call Vertical using Weekly Options (DIA 6 Jan 2017, 199/200 Short Call Vertical). Below are the actual orders executed for this trade. 

I closed the 3rd Jan DIA trade with profit. After closing this trade, I noticed that DIA was still below the Daily Memory Resistance. So, next day, on 4th January, I kept an eye on DIA. Looking for another opportunity to take a Bearish trade - provided the CUE charts signaled one.

As it turned out, again, DIA was the only one among DIA, QQQ, SPY that failed to go above Early Range High in the morning session after Market Open. And I took the same Short Call Vertical spread that I used the day before; using Weekly Options.  

Here is the Risk Profile of this second trade.

As usual, I put my GTC profit booking order on half position at 50% profit level. However, this was not triggered. At the end of the day on 4th Jan, I looked up DIA in Fine Tune 5 Min chart. DIA did not go down. Neither could it go up. It Closed right inside Early Range. As the Daily Chart Memory Resistance was not violated, I decided to carry the trade overnight. Below is the CUE Fine Tune view of DIA at the end of the day on 4th Jan.

Carrying the trade forward turned out to be the right decision. Next day, DIA fell, and the GTC profit-taking order on half position was executed around 11 AM on 5th Jan.

I then put another quarter position profit-taking GTC order at 75% level. And before midday on 5th Jan, that was also triggered. I was then left with a quarter of the original position. And I decided to try to let it expire worthless. Knowing that from this point onward, the trade was a guaranteed Risk-Free-Trade. Even if DIA rallied, due to the loss-limiting feature of Vertical Spread, the overall trade was going to make a profit.

Here are the DIA Vertical Spread orders executed on this trade till this point.​

Next day; on 6th Jan; which was the expiry day of the Vertical Spread, DIA did not come down. Instead, it went up and Closed at 199.51. Right in the middle of the two legs of the Vertical. The DIA Long 200 Call expired worthless. And the DIA Short 199 Call was worth 0.51. I had opened the Vertical Spared for 0.41 credit. So there was a small loss in this remaining position.

Overall, still, the trade made 44% profit in 3 trading days. I was able to capture a profit as I booked profit in a disciplined manner at 50% and 75% levels without hoping for a much larger profit on the whole trade.

The CUE Fine Tune 5 Min chart below explains the full trade Entry and Exits.

As these two DIA Day Trades show, a disciplined trader can use the CUE Charts to make a significant profit using Weekly Options. Superior Profit Traders do that regularly. And sometimes they share their trades while they are taking it.

Both of these trades were posted in Superior Profit Traders Community while they were entered. Not as a Trade Alert to fellow traders. But as a way of demonstrating how the CUE Charts may be used to take disciplined and profitable trades. The trades are posted before knowing their outcome. And sometimes; if required; our traders accept a small loss and move on to next trade. That detail is also shared in the Community posts.

You may find the 3rd January 2017 trade in Traders Community following this link and the 4th January 2017 trade following this link.

There are many similar Day Trade ideas as well as Long-Term Investment, and Swing Trade ideas in the Superior ProfitTraders Community.

I hope as you go through these trades, it will give you some insight on how Superior Profit Traders are taking profitable trades every day in different countries around the world.

Sagar

Tuesday, January 3, 2017

Vertical Spread Option Trade with CUE Bounce Set Up

Monday, January 2, 2017

LEIBOVIT VOLUME REVERSAL TUTORIAL ON METASTOCK FOR QQQ, DIA, SPY

From the desk of Mark Leibovit:

Leibovit Negative VRs in DIA, SPY and QQQ in recent days and weeks confirmed a market peak. Now we have to watch the first days of January to see if this selling accelerates or finds support.  VRtrader was long inverse ETFs but took profits Friday with a view to reinstate positions after the New Year.

Monday, December 12, 2016

CLB and its synergistic Oil Trades.

From the desk of top market timer Mark Leibovit:


CLB has been a synergistic play for the recent advance in crude oil but has had several noticeable and trade able swings in the past few months between the 80-90 range and 110-120 range which we recently successful in capitalizing upon. In the attached video we look at the monthly pattern first and then jump to the daily pattern which clearly shows both how the Leibovit VR foretold a downdraft in the CLB and the recent (since October) upturn signed by first a Negative Leibovit VR and then a series of Positive Leibovit VRs.  Recall, we tie the 5/3/3/ stochastic in as a collaborative indicator in the process. VRtrader.com bought and sold CLB and is now on the sidelines.



Happy Trading

Jeff Gibby
Business Development Manager.

Monday, November 14, 2016

What does Trump's Shocking Win mean for the Markets?

This weekend we hosted our Online Traders Summit.

It was a great event.  John Thomas, one of our guest speakers had some really good points about what the Trump win will mean for the markets going forward.  

I wanted to share some of his insight with you.  Here is his special report on how the election will affect your trading.  

From the desk of John Thomas:

Global Market Comments
November 14, 2016
Fiat Lux

Special New World Order Issue

Featured Trade:
(TRUMP’S GIFT TO TRADERS)
(SPY), (TLT), (TBT), (GLD), (USO), (CAT),
 (X), (FCX), (BAC), (GS), (LEN), (ITB),




Trump’s Gift to Traders

In 50 years of trading, I have never seen markets turn on a dime as they did last week. As a result, they have created some of the best trading opportunities of the century.

The sector rotation has been fast and furious. And trading volumes across all asset classes exploded to their highest levels in years.

Of course, they were responding to the biggest election upset in history, which flipped the direction of the global economy 180 degrees in a heartbeat.

I am suddenly reminded of economist John Maynard Keynes’ most famous quote: “When the facts change, I change. What do you do sir?”

My ancestors hailed from Missouri, before they moved to California during the1849 gold rush. Their black and white tintypes adorn the walls of my Lake Tahoe estate.

Every time I cross Donner Pass on Interstate 80, I remember their gaunt grim faces.

And you know what the state motto of Missouri is?

“SHOW ME!”

Incredible as it may seem, I am already in touch with several senior officials of the Trump administration, thanks to my ancient Wall Street ties.

That will give me an early read on which Trump policies are campaign fluff, which will be seriously watered down, and the few that will get actually implemented.

And as everyone in the financial markets knows, this is trading gold.

Early indications are that the incoming economic policies will be Reagan 2.0.

I remember well the jovial, backslapping president, who served from 1982-90, and who I knew too well for 25 years.

For three decades, he campaigned from the far right, championing McCarthyism, bemoaning Rowe versus Wade, demanding a balanced budget, and constantly warning of the communist threat.

The day he got into office he forget all of this, negotiating huge arms reductions treaties with the Russians, and never lifting a finger to curtail women’s rights.

We do know how Reagan 1.0 ended. Thanks to large tax cuts and massive spending increases, the national debt skyrocketed 400%, from $1 trillion to $4 trillion. The bond market got killed.

And despite all his saber rattling on the campaign trail, Reagan never ensnared America in a single serious war.

Trump could well do the same. The big shock of the decade would be how fast trump rushes to the middle.

But he has to “show me” first.

I am expecting a similar result with Reagan 2.0. Certainly the bond market thinks so, the ten year Treasury yield adding a hair raising 40 basis points in yield in a mere three days.


What we do know for sure is virtually the entire investment industry has been caught seriously wrong footed by the Trump win.

They were all, to a man, perfectly positioned for was a Clinton win, and owned a heavily weighted Clinton portfolio.

What they got was a Trump world.

IT WILL TAKE YEARS FOR INSTUTIONS ROTATE SECTORS, AND REPOSITION FOR THE NEW WORLD ORDER.


This is nothing less than the greatest gift to traders of all time.

There is one great structural tailwind to this unbelievable sector rotation.

It takes you out of over owned expensive sectors close to all time highs that have been leading the market for most of this decade, like technology.

It moves you into under owned cheap sectors that have been despised for years, such as financials, heath care, commodities, and energy.

That’s fine with me. I was getting tired of chasing technology for small incremental gains at the risk of gigantic one day crashes, some four in the last 15 months.

You can make a lot more money buying stocks off of 5 year bottoms than seven year tops.

Maybe I can squeeze a few thousands basis points of performance out in 2016?

I have presented four Emergency Strategy Webinars for major hedge funds, clients, and the Online Trader’s Summit in as many days.

Financial advisors tell me they are finding the bullet points contained enormously helpful in explaining the New World Order to their clients.

So I am giving them in full to you below:



The New World Order

*Control of the Presidency, the House of Representatives, the Senate, and the Supreme Court means the Republicans have a free hand

*Republicans blocked fiscal spending for eight years, but will now move full steam ahead

*$1 trillion in new infrastructure spending in the Midwest amounts to Quantitative Easing 5.0

*Massive Keynesian stimulus could double US
economic growth in the short term

*Inflation will make an earlier return

*It all adds up to a big “RISK ON” and “BUY!”

The New Big Trends
Out With the New, In With the Old



Winners:

Value
The Economy
Deregulation
Taxpayers
Domestic US stocks
Defense Stocks
Inflation
Oil & Gas
Commodity Stocks
Bridges and Freeways
The Midwest Rust Belt
The US Dollar
Savers
Homeowners
Cheap Stocks

The New Stock Plays

Get These Right and You’ll Retire Early

(CAT)
Caterpillar-Infrastructure
(X)
US Steel- infrastructure
(NUE)
Nucor Steel
(PFE)
Pfizer-Big Pharma
(LLY)
Ely Lily Big Pharma
(LMT)
Lockheed Martin - Defense
(FCX)
Freeport McMoRan Commodities
(XOM)
ExxonMobil Big Oil
(OXY)
Occidental Petroleum Energy
(BAC)
Bank of America Financials
(GS)
Goldman Sachs - Financials
(LEN)
Lenar Homes- Homebuilding


Losers:

Growth
Globalization
Regulation
Multinational Stocks
Telecom and Utilities
Emerging Markets
The Budget Deficit
Solar Energy
Bonds
Yield Plays
The Euro
The Japanese Yen
Borrowers
Renters
Expensive Stocks

The Old Stock Plays

Time to Say “Thank You Very Much” and Unload

(GOOG)
Alphabet- Technology
(AAPL)
Apple- Technology
(FB)
Facebook-Technology
(AMZN)
Amazon - Technology
(TSLA) - Tesla
Electric Cars
(FSLR)
First Solar - Solar Panels
(SPWR)
SunPower Solar Panels
(GM)
General Motors Globalization
(EWW)
Mexico ETF
(FXI)
China ETF
(FXE)
Euro ETF
(FXY)
Japanese Yen ETF
(GLD)
Gold
(T)
AT&T - Telecommunications


The Bond Market: The Fat Lady is Singing

Sell Short every 5 Point Rally in the (TLT) for the next Ten Years

*Bonds are Toast

*The first fiscal stimulus in eight years will pour $1 trillion into infrastructure
spending

*Taxes will be cut across the board, concentrated for the wealthy and business

*Replenishing of the military adds further spending demands

*All of this adds $10 trillion to the national
debt in 8 years

*Throw in a new war and that doubles
to $20 trillion

*Is a replay of the 400% rise in national
debt under Reagan during 1982-90,
when Treasury bond yields hit 12%

*Interest rates will rocket, Buy the (TBT)


Foreign Currencies-Dollar Rally Continues

*Rising interest rates have the US dollar rocketing against all other currencies

*Interest rate differentials are the biggest driver of foreign exchange rates

*Buy the (UUP) ETF, calls, call spreads, and futures on dips

*Yen fundamentals are as bad as ever, will be the last to raise interest rates, if ever, expect a long term decline, sell short (FXY), or buy the (YCS)

*Future of Euro is dependent on an EC breakup, or not


Energy-The Double-Edged Sword

*Stronger economy is oil positive

*But a trade war with China, the world’s largest marginal new consumer, could cause demand to slow there

*Any run up to $60 will see new US fracking
production pour into the market

*So sell rallies up to $52, buy dips to $40


Precious Metals-Trumped!

*Spiking interest rates are hugely negative for gold

*Current selloff creates a great entry point
 for long term investors

*When inflation really show, that I
when you want to pile back into gold

*China and emerging nations have to buy
 several thousand tonnes to bring
 holdings up to western level

Should take prices from $1,250 to
 $5,000 an ounce in 15 years



Real Estate - A 20-Year Boom


*Millennial demographic wave is about to drive US home prices northward for the next 20 years

*Only 2.4 million homes for sale, down -6.8% YOY, creating a severe shortage, normally rises in the fall, and predicts a very hot market in the spring

*US homebuilding is proceeding at less than half the peaks seen in the 2000s, despite rapidly rising demand, creating a structural shortage

*Home equity has been the top
performing individually owned
asset class for the past 5 years

*All this makes homebuilders a big
long term “BUY”




Trade Sheet- So What Do We Do About All This?

*Stocks- Buy
*Bonds-Sell
*Commodities-Buy
*Currencies- Sell
*Precious Metals –Buy
*Real Estate-Buy

Quote of the Day

Managing money is going to be fun over the next six months,” said Jeffrey Gundlach of Double Line, on the surprise Trump election win.

For more information on John Thomas, visit www.madhedgefundtrader.com.

This is not a solicitation to buy or sell securities

The Mad Hedge Fund Trader and Innovative Market Analysis are not a Investment advisors.

For full disclosures click here at
http://www.madhedgefundtrader.com/disclosures
The "Diary of a Mad Hedge Fund Trader"(TM) and the "Mad Hedge Fund Trader" (TM) are protected by the United States Patent and Trademark Office
The "Diary of the Mad Hedge Fund Trader" (C) is protected by the United States Copyright Office

Futures trading involves a high degree of risk and may not be suitable for everyone.


Monday, October 17, 2016

VOLUME REVERSAL TUTORIAL FOR AVON - AVP

In today's video, top market timer Mark Leibovit reviews Avon.



Enjoy.

Happy Trading
Jeff Gibby
Business Development Manager

Monday, September 26, 2016

Looking at Twitter

Top Market Timer, Mark Leibovit takes a look at Twitter in this four minute video:

https://youtu.be/tnHSirklu4w

Happy Trading.