August 17, 2017

Gold Hits a Short-Term Extreme

*Over the short-term Gold (GLD) has pushed into 'very overbought' extreme which could trigger a trade over the next few trading days. If gold happens to move higher and thereby push further into 'overbought' territory I will most likely enter a trade over the next few days. As always, subscribers, be on the lookout for a real-time trade alert and tweet of the trade. New Credit Spread Options Strategy – Beta The market moved lower again today and the Russell 2000 (IWM) is now 4.3 percent below the 86 strike. I sold a vertical spread with 53 days left until August expiration for a $.34 credit and now the spread is worth approximately $.45. The two week rally that occurred during the latter part of June/beginning of July sent the price … [Read more...]

Options Strategies Continue To Shine In This Volatile Market

I am going to keep it rather short tonight. The market moved lower today, but the bears had a rough time pushing the major benchmarks decisively lower. We could still see a push lower, but over the short-term the direction leans towards the bulls. However, there are a few international ETF's that have pushed into an oversold state and a few could be potential plays going forward. Currently EWZ, EWP and TBT are on my radar for short-term plays and as always I will inform all of you (my paid subscribers) in real-time if and when a trade occurs. New Credit Spread Options Strategy – Beta The two week push by the bulls has pushed the value of my credit spread to approximately $.51 which is $.17 higher than my original price. For all … [Read more...]

Short-Term High-Probability, Mean-Reversion Indicator – Silver (SLV) Hits Another Short-Term Extreme

The last time Silver hit a short-term "very overbought" extreme, I called for a short-term reprieve in SLV and the High Probability, Mean-Reversion strategy made 19.8 % on the trade (you can check out the trade at my third-party monitoring service here). If the Silver ETF opens up tomorrow I will be making the same call so paid subscribers stay tuned for the potential for a real-time trade alert. As for the rest of the market, well, it seems as though everyone is anxiously waiting for Bernanke & friends to release some type of catalyst over the next two days. I expect to see the market move into the summer doldrums for various reasons immediately following (if not before) Bernanke's first press conference on Wednesday. Gold (GLD), … [Read more...]

Short-Term High-Probability, Mean-Reversion Strategy – Silver, Russell Trades Successful and A Brief Discussion on Position-Sizing (SLV, IWM)

The High-Probability, Mean-Reversion Strategy reaped further success today. Towards the close of the trading session I was able to close out IWM from last week and an SLV trade that I placed this morning - both for a nice profit. The IWM trade made 21.2% and the SLV made 19.8%. So far the strategy is up 8.9% for the month of April. Check out the results here. I still have my other trade on from several weeks ago and I expect to close out the trade once the gap from 3/30 is closed. Yesterday I mentioned that if Silver (SLV) opened up todaythat I would send my subscribers a real-time trade alert. Indeed that set-up came to fruition after SLV pushed $0.30 to $0.40 higher at the open. Towards the end of the day SLV had pushed almost … [Read more...]

Short-Term, High-Probability, Mean-Reversion Strategy – A New Addition (SLV)

Per the title of my post, I have decided to add the Silver ETF (SLV) to my High-Probability, Mean-Reversion Strategy. The ETF has wonderful volume/liquidity which makes the bid/ask spread extremely tight. It is certainly an appropriate addition to the strategy. Thanks Betty! With that being said, Silver (SLV) has pushed into an extreme "very overbought" state. Couple that with an RSI (2) of 99.9 and I think a short-term lies ahead. If indeed SLV opens higher Monday I will most likely place a trade in the strategy. Subscribers stay tuned for your real-time alerts and tweets. If you haven’t already, don’t forget to sign-up for my Free 30-day trial. Also, for those of you who live on Facebook. You can access my daily info there as well. … [Read more...]

Short-Term, High-Probability, Mean-Reversion Strategy

Up, up and away! Low inflation, low interest rates, accommodative Fed policy, strong earnings and healthy corporate balance sheets have helped to keep the market racing higher. Or maybe it is just the Fed pumping money into the economy through QE2? Either way, the market has been on a historical tear over the past two years. Absolutely, nothing can hold this market down. The nuclear incident in northeast Japan remains unresolved. Coalition jets are bombing North Africa, namely Libya. More protests in Yemen, Syria and even Jordan. A grim UK budget prognosis. More Eurozone debt bailouts on the way in Ireland, Portugal, Spain, Italy and Greece. New home sales plunged to a historical low. Again, it doesn't matter - the markket … [Read more...]

Short-Term High-Probability, Mean-Reversion Indicator – It’s Finally On!

Yesterday, I mentioned that EFA had moved into a short-term oversold state and that the RSI (2) for the ETF had pushed to slightly above 5. I warned that a potential trade was near. The catastrophic events in Japan over the weekend led to further declines today and pushed EFA into a short-term extreme with the RSI (2) hitting a low of 1.12 before coming back to close the day at 1.52. The gap lower today will close once the EFA hits $58.84. This will most likely be my exit point if indeed EFA moves higher over the next few days. As I write this the futures are significantly lower so we will see if we get stopped out first. Tomorrow should indeed be an interesting one. If you haven’t already, don’t forget to sign-up for my Free … [Read more...]

Short-Term High-Probability, Mean Reversion Indicator – ETFs Remain in a Neutral State

The market remains in a short-term neutral state and has for quite some time, but as I always say, patience pays. The weeks when "sit on hands" is most appropriate is often the times when I see irrational trading occur. Remember, the less you trade the better. I can't tell you how many times I have seen subscribers leave because of a lack of trading which befuddles me given the fact that a strategy has proven its worth. This time is no different. Oh well. The Utilities sector (XLU) and China (FXI) are the two ETFs that are closest to a short-term overbought extreme, so of course I will be watching them closely. Believe me, I hope we get another bullish move tomorrow that extends the market and puts several of the ETFs I follow in a … [Read more...]

Short-Term High-Probability, Mean-Reversion Indicator. Short-Term Reprieve Around the Corner?

Over the past few days Jason Goepfert has put out some astounding statistics. He is an awesome analyst and the following stats go to show just how helpful his research is for traders. Today he stated that the S&P is about to hit the worst of January seasonality. Typically, seasonality does not play into my trading, but given the short-term "very overbought" extremes in most of the ETFs I follow, I think the current seasonal conditions could act as a strong breeze for the bearish camp. Just look at the current short-term extremes in the major benchmarks. DIA and SPY are "very overbought" and have RSI (2) readings above 95. In most cases, when we see this type of short-term set-up the market is due for a short-term reprieve. I was able … [Read more...]