# P2 US Equity Portfolio



## peter2

*P2 US Equity Portfolio*:      Suitable for beginners and much easier than day trading. 

I'm going to establish and manage a portfolio of stocks from the US markets. My main reason for doing this is to gain more experience with US equities. The trading strategies for this portfolio will be based on the weekly and daily price charts. The main bulk of the capital will be used for the weekly positions leaving a little for some shorter term trades based on the daily charts.

I'm going to start with a small account balance. This is not something I would recommend because brokerage costs in Aust are too high and severely reduce performance in small accounts. However one of the benefits of trading US markets through a US broker is that the brokerage costs are much lower. 

This project will be maintained until the EOFY (30th June 2020, Aust). This will give the project a little over six months to show its worth. 

The plans for both the weekly and daily strategies are similar to those outlined in the P2 Wkly/Dly Portfolio thread in the ASF Members section. If you want to know the details and are not a member please sign up. Then you may ask questions and I'll reply. 

I'm going to start with the Russell 3000 list. At the moment I'm going to focus on the lower priced stocks as they will use less capital. 

_Starting account balance_  $25,600  
_Initial Trade Risk_ = 1%. Max position size 25%, Min pos size 3%

_Method:_ The aim is to buy near the start of a new up trend (BO-HR) or at the next opportunity (BO-NH). Chart examples will be posted.

Week-end scans of Russell3000: 
(i) Weekly Bullish Key Reversal bars
(ii) Weekly Bullish bars (up bars with above average volume that are moving off the 13wk ema)
(iii) Weekly Darvas boxes


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## peter2

Chart showing the setups for this portfolio. The up trend is defined by the weekly 13 and 21 emas. I must wait until prices are above these emas before looking for a setup. 

(1) Start of an up trend (BO-HR). Best entry setup. 
Both the weekly key reversal and bullish bar scans would have found the weekly bullish bar arrowed below the (1). The buy is triggered either immediately (next Monday's open) or waiting for price to trade above the horizontal resistance (HR )line at 5.60.

(2) First opportunity after the start of the trend (BO-NH).
This entry is triggered by price making a new high above 6.40 or 6.50. The 6.50 is a new yearly high in this chart (orange line). 

Buying at the new highs above 8.45 and 9.26 are considered too late for this system. The earlier setups provide the best reward for the initial risk.


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## qldfrog

Much appreciated Peter as i am toying with the idea of using a bigger market as welll


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## peter2

Looking for bullish setups on some weekly charts of the US Russell 3000. There were 35 bullish key reversals (only 5 worth more consideration). Then scanned for bullish bars and 425 appeared. OK that's too many. Cut the share price to <$40, 216 appeared, cut it again to <$20 and there's still 140 to go through. Clearly a work in progress to reduce the number in the scans.


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## Warr87

peter2 said:


> Looking for bullish setups on some weekly charts of the US Russell 3000. There were 35 bullish key reversals (only 5 worth more consideration). Then scanned for bullish bars and 425 appeared. OK that's too many. Cut the share price to <$40, 216 appeared, cut it again to <$20 and there's still 140 to go through. Clearly a work in progress to reduce the number in the scans.




That's the appeal of the US market -- greater liquidity and many more opportunities (And lower brokerage costs).

What's the appeal for you to trade the Russell3000 over the other exchanges?


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## hallph

Very interested to monitor this as I have slowly been adding some US names to my portfolio. As I like to sleep I am working on a weekly system, set stops, let them go


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## peter2

@hallph  Thanks for your interest.  This project continues to baffle me. I started with the idea of applying a similar price action system that I use in the ASX (bullish bars rising of a MA and breaking out from a trading range). The number of opportunities are huge and I'm having difficulty reducing them to a manageable number. Looking through the scan results there are lots of perfect setups that have provided great profits. However there are three times as many opportunities that fitted the perfect criteria but didn't produce any profit. I've been so far unable to filter out enough of the rubbish from the scans. 

Currently I'm considering a very small number of stocks that cover the main sectors of the US markets. This list includes ETFs and some major companies in some sectors where the sector ETF price is too large. One benefit of ETFs is that there's less interference from earnings news and broker upgrades and downgrades. 

This is probably a better starting point for a beginner thread. I'm back testing the strategy on this smaller list over the holiday period to see how it performs.


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## Warr87

that's certainly a problem. I wish I had ideas for you on how to narrow down the list. Adding some kind of ranking matrix is going to be needed, but no idea on how you will do this. I'm looking forward to this and learning what you do.


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## ducati916

peter2 said:


> @hallph  Thanks for your interest.  This project continues to baffle me. I started with the idea of applying a similar price action system that I use in the ASX (bullish bars rising of a MA and breaking out from a trading range). The number of opportunities are huge and I'm having difficulty reducing them to a manageable number. Looking through the scan results there are lots of perfect setups that have provided great profits. However there are three times as many opportunities that fitted the perfect criteria but didn't produce any profit. I've been so far unable to filter out enough of the rubbish from the scans.
> 
> Currently I'm considering a very small number of stocks that cover the main sectors of the US markets. This list includes ETFs and some major companies in some sectors where the sector ETF price is too large. One benefit of ETFs is that there's less interference from earnings news and broker upgrades and downgrades.
> 
> This is probably a better starting point for a beginner thread. I'm back testing the strategy on this smaller list over the holiday period to see how it performs.




Cross biotech off of the list. Too manic.
	

		
			
		

		
	





The other issue is that the US market operates very differently to the Aus. market. The US has Market Makers. They have a huge influence in the stock market. Then you have the FOMO in the Treasury market. The Arbs cover the Futures/Stock Indices spreads, but they tend to have an impact near the close and you can get some funny prints. Add in all the crazy algorithm traders that turn on a dime and you have either a day traders paradise or a swing trading nightmare.

I would agree that ETFs are the way forward. There is an ETF for everything. 

I remember Skate saying that trading a parcel of his $400K he would sometimes move the market with an order. Here trading the full $400K in a stock won't even make a ripple, remember you have a few stocks just below a Trillion in market cap. You have tight spreads in anything listed in QQQ/SPY/DIA.

You also have a very active Options market operating in all stocks listed above and a whole cadre of traders that trade nothing but the Options market, which makes for another level of volume that does not appear on a stocks volume (if volume is a trigger or part of your analysis).

It will be interesting to see what you come up with.

jog on
duc


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## peter2

It's a hot smokey day in Sydney. The light has an eerie orange glow as the smoke haze filters the sun. Those lines remind me of Snoopy starting his novel, "It was a dark and stormy night". 




However unlike Snoopy who was sitting on top of his kennel, I'm in air conditioned comfort. Let's continue this thread so we can start making some USD. 

The difficult decision for me has been selecting which stocks to use as a trading universe. As mentioned earlier there's just too many that appear in my scans. When I do my 1st BB scan on the ASX each pm there's about 20 - 30 and I can go through them in a few minutes to find the few that are worth further consideration. When I do this scan on the Russell 3000, there's 200 - 400 results. If I took the time to go through these there will be about 20 - 30 perfect charts to consider. Selecting only a few is very difficult and makes me feel like I'm depending on luck rather than probabilities. 

Same thing with Darvas boxes, too many. I've considered high volume gap ups (news). There's just too much work finding a few perfect setups. 

I've decided to do the opposite and start with a very small list of trading candidates. They're mostly ETFs with only a few mainstream stocks. 

The next decision was to go long only. For the beginners, this means we'll be buying first and selling later. Good when the market goes up but what happens when it goes down. Well, the list includes some inverse ETFs. When the market goes down these inverse ETFs go up. This makes it easier as we're only looking for setups in one direction. 

This list is only a starting list. I will add to this list as we progress. Various sectors and commodities become "hot" in the media throughout the year. We'll add the occasional "hot" stuff to our list. eg. Last year the cannabis sector was hot. It shot into blue sky, exploded like fireworks and has been going down since then. We can trade these booms and busts when we see them. 

*This is were you can help out.* If you see a "hot" prospect, mention it here and we'll find something to trade it.


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## peter2

*US trading candidates*:  Starting List.

_General US market ETFs_: 
*SPXL* = SP500 stocks [ inverse = *SPXS* ]  SPY is too pricey (>$320)
*TQQQ* = Nasdaq stocks  [ inverse *SQQQ* ]
*TNA* = Russell, small/mid caps  [ inverse *TZA* ]

_Sector ETFs_:
*LABU* = biotech  [ inverse *LABD* ]
*SMH* = semiconductors (too pricey so we'll trade the stocks *AMD*, *MU*, *WDC*)

Other sector ETFs (banks, retail, REITs, utilities etc ) are too correlated with the market and we're going to stick with the general market ETFs.

_Commodity ETFs_:
*GDX, JNUG* = gold [ inverse *DUST* ]
*XLE, XOP* = Oil producers and explorers
*LIT* = lithium
*URA* = uranium
*REMX* = rare earth materials

I've excluded the cannabis sector for the present but it's a strong possibility to be included soon if I can find a highly traded instrument to use. Remember when the plant based burger was news! That was a hot topic at the time (BYND).


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## peter2

I've put these instruments (stocks, ETFs) into a watch list for easier access and review. 




Now I need to outline what we're looking for as a trading setup. We're going to trade the price swings that we see in the *daily* charts. As we're only looking for long setups our task is much simpler. I'm going to restrict our trading setups to only two. Both of these setups are based on the price action that we see on the daily charts. We'll be able to identify the setups as they form and when they complete we'll be able to place our orders into the market before they trigger. 

One setup is a *reversal* and the other a *pull-back*. 

Trading the daily charts means we have each evening to do our pre-market work. Not having enough time is no excuse if you're really keen to learn how to trade.


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## aus_trader

ducati916 said:


> Cross biotech off of the list. Too manic.




Totally agree. Even worse than the Aussie Biotech's when it comes to those wild price swings with massive gaps as well usually !


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## peter2

First setup: *123 Low reversal pattern*.

An old classic and my favourite. We need a down trend and then a swing low (pivot low). The swing low is labelled as the #1 point. Then we need to see a swing high that we label as the #2 point. Then we need another swing low that does not go below the #1 point. We label this higher low as the #3 point. If price goes below our #1 point then the pattern is restarted with a new swing low (#1). 

The buy trigger is when price trades above the #2 point. Yes, it's a break-out strategy. I've labeled two 123Low patterns on this chart.



There's tons of information on this pattern on the net. People try to complicate the pattern with extra indicators but they don't help. 

We will trade this pattern using conditional buy orders (or they're called buy stop orders in some platforms). The initial stop loss  (iSL) is placed below the #3 point or #1 if you're more conservative.

If you're new to the markets and are interested in following this thread then it would be wise to find this pattern in all the charts you look at. Sometimes they work out and sometimes they don't.


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## sinic

Regarding comments that prices are too "expensive" - Interactive Brokers are now offering fractional shares purchases on US  stocks  - and also the ability to purchase a $ amount rather than share quantity. For example you can buy $200 worth of Amazon.


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## peter2

The semiconductor sector is in play because of the US-China trade talks. It's also a dominant sector of the US market. The semiconductor ETF that's heavily traded is SMH. SMH is difficult to trade because of all the gaps. These price gaps happen because of news that is released when the US market is closed. 

The current price of SMH is approx $143 USD and if we had a setup with a small iSL size then we would use most of the capital in our account for a trade position. eg if our iSL size was $2, we would buy 260/2 = 130 shares of SMH worth $18,590USD (>70% of our starting capital). 

I find it easier to trade a few of the main components of the sector ie AMD, MU and I throw in the disc drive stock WDC.  

@sinic   Thanks for that info. 

Here's the 2nd last 123 Low pattern in AMD.


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## peter2

Sometimes we don't get the nice 123Low setup that we prefer. The market zooms higher and we have to wait for a pull-back entry. 

Second setup: *Pull-back* into an up trend. 

The first requirement is an impulsive swing up to a new high. This swing up must break through a horizontal or sloping resistance line. Next, we have to wait until price touches the 50% pull-back level. It's better if the corrective pull-back is sloppy or has an appearance of a three wave abc correction. As soon as price trades below the 50% level we look for an buy setup. 

There's a few possibilities here. We could use a 2bar count back line (CBL) on the daily chart (popularised by D Guppy) OR we could use a 123Low setup using the 1hr chart. 

The conservative place for the iSL is the low at the start of the impulsive swing up. I sometimes use an arbitrary level of 80% or the #1 point of the 1hr 123 Low setup. 

If these options seem messy, it's because the corrective pullbacks are generally messy and identifying the exact low of the pull-back is difficult. What makes these setups so good is that our trade is nicely profitable before price gets back to the recent high.


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## peter2

Important aspects that we must consider and manage with our trading plan. 

(1) Correlation:  Most of the instruments that are in the list are highly correlated to each other. When the market goes up SPXL, TQQQ, TNA and most stocks will be going up also. We should consider placing a limit on the number of trades or the amount of heat that we use when trading multiple instruments that are highly correlated. I will start with a limit of 3R (=3%). 

This methodology that I've outlined is currently long:
SPXL, TQQQ, TNA, LABU, XLE, XOP, AMD, MU, WDC, LIT. 
We have insufficient capital to be holding all positions, but we don't need to. Our job is to deploy our capital in the markets that are going up and manage the portfolio heat. 

(2) Focus: Our trading will mostly be in the index ETFs. As we're watching both the normal and inverse ETFs we'll usually have a position in one of them. The market will be going either up or down. When we exit out of LABU there'll probably be a setup into LABD that triggers at the same time. 

We have to be focused and organised. We don't want to miss the next big swing. Speaking about the big swing the next point is very important. 

(3) Adding to a winning position (pyramiding): It's very important that when we get into a move that starts well, we add to it. Index and sector swings can turn into large trends that last months. We must add to all our winning positions as soon as practical (ASAP). 
ASAP is when the iSL of the next setup is at or above the prior one.  See next post. . .


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## peter2

I agree that the biotech sector is volatile when were talking about individual stocks. Let me show you the latest chart of the biotech sector ETF LABU. This chart shows a huge move up as the market makes new all time highs. The large cap biotechs have boomed with the market. This swing is smoother than the market ETFs (SPY and QQQ). It's been on a dream run (if we're holding it). 




The initial 123 low pattern (pictured) triggered 14 Oct 19 and is currently +6R at it's trailing stop. This is a good result, no doubt above average. +6% over 2.5 months I'll take that. 

BUT we can do better. Adding to the position at the two levels indicated by the green lines there's another 11R available. Now we're talking, +17% in 2.5 months. 

This one trend will make our year if we trade it properly. Adding to our trades is a must.


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## aus_trader

peter2 said:


> I agree that the biotech sector is volatile when were talking about individual stocks.



Very true. But as you have been kind enough to show us, it may be possible to trade the ETF with sensible position sizing without having to crap on your seat when you open the chart the next time to have a look at how your trade is going.

Plastic seat cover is recommended with trading individual Biotech stocks without proper position sizing


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## ducati916

Agreed ETFs are the way to go in many cases. All of those tickers are x3 leveraged ETFs (LABU,LABD,TQQQ, etc) just to make clear. There are a load more for various other sectors.

Here is the list: https://etfdb.com/screener/#page=1&leveraged=3x

jog on
duc


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## peter2

I seemed to have lost a post, quite a long one and it hasn't been saved. I probably didn't hit post and left the site. Normally my post is saved and still available when I next log in. This time, no.

@ducati916  Just realised that your avatar is Snoopy and that must have been in my mind as I posted following one of yours. Sorry about that.

Trading ETFs seems like a wise decision for a newcomer to the US markets. Thanks for the link I've been going through the high volume ones this afternoon. The numbers of ETFs have exploded since I last looked.
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That was the first part of my lost post and I don't remember the rest. Damn. I've got a list of about 30 ETFs that I'll monitor for setups for this thread.


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## peter2

OK I found the "lost" post. It was misplaced in Ducati's commodity thread.


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## ducati916

The US market also allows for a number of different strategies owing to the deep options and futures markets. Your daily/weekly directional system is an example of a strategy.

Other strategies:

(a) Pairs trading (market neutral);
(b) A number of Options strategies (market neutral, earnings, directional, volatility, etc);
(c) Pure day-trading Bracket trades (Open and Close).

I'm sure there are numerous others.

An example of 3 pairs trade available today.












jog on
duc


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## ducati916

If you want ETFs only:




This trade can be put on via SQQQ and UDOW to juice the spread. I have this trade on currently.

Not currently available, but will be back at some point:




Traded via UDN and UGLD (past trade)

No need to go 'short' shares, simply use the X3 inverse product for extra juice.

jog on
duc


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## qldfrog

Using etf on the US market seems indeed the way to go for us with limited local knowledge and facing a market which is nearly too big...what a paradox
Thanks for all the learning guys and gals


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## qldfrog

Just thinking aloud, if systemised, inverse ETFs..going up when market is down , are quite tricky to handle when you use indexes to variate your exposure or risk based on market condition....


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## Joe90

Hi Peter, you may find some inspiration for scans and filters on the Stockbee blog; he trades the US markets  and seems to specialise in momentum breakouts. Most of his basic code can be found with a search of the the site. Here's a starter. https://stockbee.blogspot.com/search?q=momentum+scan


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## peter2

@Joe90  Thanks for the link. I've looked over his site and there's lots of info there for a momentum swing trader. These the types of swings I'd like to trade, but as the website owner states, there's a lot of work to get organised and work out how to trade them profitably.

*1st Trade*:  SLV silver ETF, clear BO-HR on daily chart. Entry at 16.15 pre-market.


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## peter2

*2nd Trade*: Gold and silver are highly correlated in that they move together. About an hour after the silver BO-NH gold made a new high and triggered a trade for us. I'm watching both GDX and JNUG for gold trades. They both triggered at the same time and the one I used was JNUG because the trade used less capital than GDX. 

@rederob was keeping us at ASF informed about the latest rally in gold. We had plenty of time to get into a gold trade. Thanks. 1hr chart of JNUG. 




I should also mention that JNUG is a leveraged ETF moving approx 3x the move in gold price. When there is a fast, large move in the gold price a leveraged product will provide a bigger RR result. You can see this in a comparison of the two trades.


The JNUG trade shows an extra 0.9R when compared to GDX. The trailing stop on the JNUG has been raised to lock in +2R.  GDX trade not taken.


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## peter2

We have to be patient with the US indices as we've missed the entries into the current rally. A little dip or a reversal will form a few setups for us. This is my current list. Open trades marked in green and those that are setting up in orange. 


	

		
			
		

		
	
  It's a little thing but if I'm short on time I'll check the orange ones first.


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## peter2

REMX is worth discussing. Missed the latest rally and I was waiting for a pull-back setup. Remember, we need price to go down and touch the 50% level of the prior impulsive move. Once this is done we can look for one of our two setups for this formation (CBL2, 123Low in 1hr chart). 

REMX did trade down to the 50% level. 


	

		
			
		

		
	
  Check.
Let's look at the 1hr chart.



	

		
			
		

		
	
  Yikes! Where are price bars?

Clearly, the daily and hourly traded volume is too low for me. This market cannot be traded as the slippage might be very expensive. I'll delete this market from my list. I thought REMX may provide some info that might be relevant to Lynas (ASX:LYC). I think not. Lynas will be more dependent on the Malaysian Gov't policy than rare earth prices.


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## qldfrog

peter2 said:


> REMX is worth discussing. Missed the latest rally and I was waiting for a pull-back setup. Remember, we need price to go down and touch the 50% level of the prior impulsive move. Once this is done we can look for one of our two setups for this formation (CBL2, 123Low in 1hr chart).
> 
> REMX did trade down to the 50% level.
> View attachment 99266
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Check.
> Let's look at the 1hr chart.
> 
> View attachment 99267
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Yikes! Where are price bars?
> 
> Clearly, the daily and hourly traded volume is too low for me. This market cannot be traded as the slippage might be very expensive. I'll delete this market from my list. I thought REMX may provide some info that might be relevant to Lynas (ASX:LYC). I think not. Lynas will be more dependent on the Malaysian Gov't policy than rare earth prices.



Peter, in term of volume, i believe the Christmas holidays explains a lot
Not sure any movement this week or next is worth triggering buy or sell as it is a dream period for some to try to influence market for cheap:
Limited hours, days and volume
My 2c


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## qldfrog

Note 
I will still follow my systems indicators but to be honest, it is hard to compare apple and oranges and i I'm afraid this is what my systems do this week and next


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## peter2

It was Boxing day and I was full of cheer, no, not what you're thinking. I was cheerfully looking forward to the US open (no Boxing day holiday there). Gold was going up, the US indices were going up, the early morning was looking promising. JNUG and SLV were trading higher in the pre-market. All was good. until, the monitor on the right went dark. A restart splattered my desktop icons all over the place and the monitor remained dark. It was close to the US open. I clicked the trading platform icon but it didn't open. Arrgh!  

I uninstalled the platform and re-installed it. No good. Both the old and new versions of the trading platform wouldn't install. I was seeing windows' errors. Grr Windows 10. Why didn't they leave it at version 7. 

The only thing I know for sure is that one of my graphics cards was shut down by Windows after too many errors. I'll have to replace it. Of course not many computer shops are open today. I could order a replacement online and wait 1 - 2 weeks (as if). I'm phoning local computer stores now.

While all this was happening the price of gold went higher and triggered a limit sell order that I'd put in earlier on JNUG. Sold at T4 (+4R). Can't complain as I wasn't expecting it to get hit so quickly. SLV is still open, but the initial stop size was a little big and it's not producing a similar result. Opened the laptop, installed the trading platform on it no problems, put in a trailing sell stop on SLV. It was hit a few minutes later as the gold/silver prices dropped a little as the index's charged higher.




I won't mention to Bob that the swing trades have started well. That would only stress him out a little more (see Bob's thread). I'm stressed because I hate it when computers don't work. I don't know why I can't install the trading platform.


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## qldfrog

If it helps, remove the doomed graphic card, use your basic motherboard screen output to keep you going  with one screen
I did not ask but do you have multiple GCards..i remember a pretty impressive setup?
Not sure about trading platform installation, so many potential causes....


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## qldfrog

Hope you sort it out


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## peter2

Yes, I've two graphic cards and will replace one this evening, hopefully. I can use two monitors just not the small single laptop screen. 

The failure to install the trading platform (old and new versions) on the desktop is a bigger problem. I'll keep the screen shots of the error messages and send them to support.


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## Warr87

good luck mate.

and why 2 graphics cards? You know most graphics cards these days support 2 monitors on a single card .

And that is an interesting problem .... and odd. Best of luck with that one!


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## peter2

@qldfrog  Thanks for your offer of assistance with my PC problem. 
Installed a new GC and it didn't work either. Swapped the old good one into the second slot, didn't work. Put the old "bad" one in the top slot, it worked. Not the GC.
Was advised that it's probably the motherboard. Motherboards are cheaper than GC's but more work to install. No probs, order one in for me. I'll get back to you. 

Got home, vacuumed all the dust from the desk,  It was very dusty. Reattached everything and "presto" everything was working. All icons were back in their right spots, all three monitors were working, just out of order. 

_Lesson for the day_. Beats me, although I did pay for the guys time even though he didn't do anything. Good karma fixes computer. (?) or a little bit of corrosion was removed by all the removing and replacing of components.(?) 

Now, to tackle the install problems. I feel lucky tonight.


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## aus_trader

Hope you'll be on a roll Pete, best of luck.


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## peter2

The install problem remains. I can't install my trading platform. I'll send a pic to support.


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## qldfrog

peter2 said:


> @qldfrog  Thanks for your offer of assistance with my PC problem.
> Installed a new GC and it didn't work either. Swapped the old good one into the second slot, didn't work. Put the old "bad" one in the top slot, it worked. Not the GC.
> Was advised that it's probably the motherboard. Motherboards are cheaper than GC's but more work to install. No probs, order one in for me. I'll get back to you.
> 
> Got home, vacuumed all the dust from the desk,  It was very dusty. Reattached everything and "presto" everything was working. All icons were back in their right spots, all three monitors were working, just out of order.
> 
> _Lesson for the day_. Beats me, although I did pay for the guys time even though he didn't do anything. Good karma fixes computer. (?) or a little bit of corrosion was removed by all the removing and replacing of components.(?)
> 
> Now, to tackle the install problems. I feel lucky tonight.



Dust cleanup has resurrected a desktop twice for me
You can buy oressure gas can or just use carefully you home vacuum cleaner


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## qldfrog

Com server registration issue  is commonhttps://clientcenter.tradestation.com/download/installationpop/importantmessage_06122003.htm
Then i suspect your support line could give you one or more dll to register manually in a dos prompt (run command) then in the right directory
regsvr32 xxxx.dll
Sadly i do not know much about tradestation so can not really help you further but you might be able to suggest this to support and they might give it a go
Otherwise, a matter of removing every thing cleanly, disable firewall before a clean reinstallation
Best of luck


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## jjbinks

Hi P2,

I'm a bit late to the party. But glad to see you tackling US stocks. 
Hope you fixed your install issues.

Just wondering if you are planning to trade short aswell?

Cheers
J


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## peter2

Not exactly. The list of ETFs contain a few inverse ETFs. When the market goes down these will form setups to go long. So, yes I'll attempt to profit when the market goes up and down.


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## jjbinks

peter2 said:


> Not exactly. The list of ETFs contain a few inverse ETFs. When the market goes down these will form setups to go long. So, yes I'll attempt to profit when the market goes up and down.



Hi P2,

I until recently was also thinking about role of inverse ETF in my trend following system. After reading Clenow's _Trading Evolved_ I decided it probably wasn't best idea. Clenow basically explains how volatility also causes Inverse ETF's to lose money compared to index.

His example
E.g 
If Index starts at 1000 points and then increase 3% to 1030 then drops by 2.91% to 1000 again and this happens 5 times with index going up and down but returning to 1000.
Inverse ETF will go 1000-->970and then only go back to 998 when original index rises by 2.91 and then down to 968.3 and back up to 996.5 and so on so with high volatility can effect your results.

This is probably not that big a factor for you if you have shorter holding periods but with longer holding periods it is definitely something to think about.

Cheers
Jj


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## qldfrog

Maybe a stupid idea but if instead of climbing then falling back to 1000, index  falls then climbs, do you just not have the exact opposite and in this case the inverse etf saves your bacon?
I am on the phone but a quick excel spreadsheet run would demonstrate this in no time


----------



## frugal.rock

Was wondering how you uninstalled the platform? Through the program uninstaller or Windows/Control Panel..
Was thinking maybe either way, you have some registry entries/orphans  (comm server?) remaining from previous install. Installer tries to install but sees entries already there, aborts?
Try regedit and look for pertinent entries on the working install (laptop), then do the same on desktop, might find some entries that need a massage (delete). Be careful though!
Lots of dust, heat, chips fail usually temporarily from the heat. Bit like brake fade on a car.
Other scenario, dry solder joints on circuitry. Bit of movement can create closed circuit again...for a while. Would suggest actual card fingers are goldfingers as would the card slot be. Corrosion/oxidation possible from crappy gold alloys and dissimilar metals but would be visible if this was the case.
Good luck.


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## fergee

P2 This is a fantastic thread thank you! I will be following this from now on.
Just wanted to know your views on your FX risk are you hedging or taking a view on the AUD?


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## qldfrog

frugal.rock said:


> Was wondering how you uninstalled the platform? Through the program uninstaller or Windows/Control Panel..
> Was thinking maybe either way, you have some registry entries/orphans  (comm server?) remaining from previous install. Installer tries to install but sees entries already there, aborts?
> Try regedit and look for pertinent entries on the working install (laptop), then do the same on desktop, might find some entries that need a massage (delete). Be careful though!
> Lots of dust, heat, chips fail usually temporarily from the heat. Bit like brake fade on a car.
> Other scenario, dry solder joints on circuitry. Bit of movement can create closed circuit again...for a while. Would suggest actual card fingers are goldfingers as would the card slot be. Corrosion/oxidation possible from crappy gold alloys and dissimilar metals but would be visible if this was the case.
> Good luck.



Last but not least ensure your motherboard battery is ok, does not cost much to ensure that cell battery is replaced as part of your air dusting cleaning


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## peter2

Thanks for all the follow up suggestions re the desktop. Everything seems to be OK and working. I've started to re-create the Tradestation workspaces which will take quite some time.

re: FX movements. I'm not concerned by this. The aim is to earn lots of USD first.

re: ETF vs benchmarks. I'm aware that very few ETF's match their benchmarks and this is mainly due to their mgt fees. The more exotic the ETF the higher the mgt fee. Out of hours market movement also is a cause for under performance.  This might only be of concern if you're planing to hold an ETF for years. No such concerns when trading short term swings.

The focus for this thread and my others will be on the trading routine.


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## peter2

The previous evening I started an index trade (FTSE100) and even placed a pyramid order to buy if it goes higher. I sat looking at the ticks and the trade wasn't looking too good (-0.5R). Should I bail now? I made a good decision to go for a walk. Back from the walk I forgot about the open trade and watched some telly. Going to the office I remembered the trade, well a good surprise, price rallied, took out my additional order, hit T1 and was very close to T2. I grabbed the +2.9R and prepared for the US session.

The recent pull-backs have provided a few setups in the markets I'm watching for this thread. After the sudden rally in gold (that took me by surprise while I was sleeping) I anticipated a pull-back soon. The opp was to short gold or buy the inverse gold ETF. DUST is in our list just for this opportunity.

The trigger was the BO-NH at 5.80. The 123L setup can be seen on the 1hr chart. This setup is described in our TP. The only tricky bit with swing trading smaller time frame charts, hoping to have them last a few more days, is the placement of the iSL. Normally I'd place it below the #3 HL point on the daily chart (conservative) but on this occasion I used the the #3 point on the 1hr chart. This is tricky because the market can reverse and knock you out of the trade quickly. I decided to use the 1hr chart as the sentiment for gold was quite negative after the Iranian missiles released most of the tension in the issue. At the EOD this seemed like a good decision. 




Next day, I see the trade is +1.6R and looking for more. I raised the exit trigger to lock in the +1R and you know what happens next. Yep, the market came down and knocked me out of the trade by 0.01 then reversed and headed higher. 




That damn market! Hardly, it's my bad habit of micro-managing the trade. 
Did I learn my lesson about not fiddling with the trade provided by the market on the previous evening  No.


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## barney

peter2 said:


> (that took me by surprise *while I was sleeping*)




So you do sleep … sometimes??


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## peter2

Gold wasn't the only market that provided an opportunity to get back into the bullish US index. Just about all the indices formed similar setups to that of DUST. I took another trade in TQQQ. Considered SPXL and LABU but thought that NDQ was stronger and newer new ATHs. 




The Nasdaq market is too volatile to place my iSL below the 1hr HL and I selected a level further down (88.50). This morning's gap up took the trade higher to +1.3R and I raised the TS above BE (91.50). Now just before I retire for the night  I see that the market has traded sideways. It will most likely drift lower. Do I want to leave the TS at BE? I can't. I'm such a tight ar$e and I've raised it to below 94. This locks in another +1R result should the market trade down to my exit stop. 

Why do I keep micromanaging most of my trades? This is me. We all have our trading quirks. 

The lesson for the beginning traders is to recognise your own trading quirks and consider if they're damaging your results. If they are, like "failing to pull the trigger" then the problem most be overcome or minimised. 

I can justify why I put up with my quirks, but as we know, that's just my rational mind making up a story to explain my emotional knee jerk actions of micro-managing to avoid risk.


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## peter2

The market took me out soon after  I posted. 


Was my moving the TS a good thing or bad? I don't know. I'll look for the next opportunity tomorrow.


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## qldfrog

I definitively would not be suited to that trading.and this knowledge is priceless


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## peter2

After a few quiet days with the US markets making new all time highs, we're into a few trades. 

XLV: Healthcare ETF.  



The Russell smaller cap sector lags the large caps (SPY) and tech (QQQ) but is trying to catch up. 

TNA ETF:


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## peter2

On our ETF watch list is MJ ( Cannabis sector). This has been hard hit in 2019 and I've been waiting for signs of life. The last two days has provided it. MJ has been going sideways for a while with occasional bullish days. 



I've also been watching the main cannabis stocks in this ETF (CGC. CRON, TLRY).  Bingo.
We're into a BO on CGC.


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## peter2

US trade book update:


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## peter2

The US markets rallied during the UK session and opened significantly higher. The markets tend to drift down a little after such a gap. I've taken profits on all trades at their T1 levels. TNA went higher and I was able to raise TS to T1 which was hit about two hours later. 

Why take profits at T1? This thread is in a beginners thread and taking reasonable profits frequently builds confidence in the trader. We can argue whether +1R profits are reasonable and this largely depends on the W% and frequency of trades. Our watch list (approx 30 stock codes) will provide plenty of opportunities as we can trade the markets in either direction. The W% has started high and will fall as the market conditions change. If it falls below 70% then taking profits at T1 is not a reasonable payback for the risk. 

I set an unannounced goal for this thread of +1R /wk or +4R /mth and in less than 1 month earned +10R. Hitting reasonable goals regularly is also important as a sign of progress towards the much bigger goal. As the gold/sliver trades were late Dec I'm allocating them to Dec19 (+5.4R) and these recent trades for Jan20 (+5.1R so far). 

I won't be taking a two week vacation for the rest of Jan. I'll spend the usual 20 minutes before the US open going through the watch list. A few more winning trades would keep us ahead of plan and offset the losses to come.


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## peter2

Update on this trade book:

The only open long was LABU (biotech) and this was closed today for a full loss (-1R) as the market reversed. This move down triggered a long trade in the inverse LABD. A bit more follow up selling is required to offset the loss from LABU.

Gold (GDX) and silver (SLV) triggered long trades.

The US indicies triggered 123 low setups on the hourly charts of the inverse ETFs. The best looking chart was the inverse SPY ETF - SPXS shown here.




I'm still bullish the US markets and will look to take quick profits on this dip.
The current trade book;


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## peter2

The US market opened gap down on coronavirus concerns. This means the open trades on the inverse ETFs gaped up. Both LABD and SPXS opened higher than T1 so I was able to place a very tight exit stop in case they went down soon after the open. They both did as the market traded higher and I grabbed the profit soon after the open. LABD +1R, SPXS + 1.5R

GDX and SLV also opened higher but not by enough to consider taking profits. Trailing stops moved higher on both trades to reduce heat. 

The trade I did miss out on was shorting the China index last week when news of the virus was first released.


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## peter2

D'oh! Typical newbie mistake. The weakest US index is the Russell small cap index and I thought the market would fall further after the open so I bought the inverse ETF - TZA at the open. Moved my exit stops on the swing trades to lock in profits as posted. Then noticed that the TZA trade was being toasted. Closed it soon after for a loss. The newbie mistake; thinking that I knew what would happen and started the trade without a setup pattern and trigger. Dumb. Got all excited by the open profits on the swing trades that I ignored the intra-day trade plan. 

This day trade loss should be included here but it would mess up my stats. This post will remind me of today's mistake. I've closed the platform down as my head isn't screwed on tonight.


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## fergee

peter2 said:


> D'oh! I've closed the platform down as my head isn't screwed on tonight.




These words are very sagely P2. Thank you.

I think newbies and vets alike should be reminded of the physiological strain that trading entails. Having that understanding of self and what frame of mind you are in is so important in regard's to when to trade and when not too.


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## peter2

Thanks @fergee  I think it's important to be proactive not reactive when trading. 

The two open trades in GDX and SLV were closed last night as the prices fell. 
GDX closed at BE, SLV closed for full loss as price opened below trailing stop. 

The last five trades produced a small overall profit (+0.6R). 




It seems the coronavirus dip only lasted one day as the contagion has been limited to China. 

China will get on top of this situation soon and their market will recover. There's opportunity to trade the recovery with the ETFs EWH (Hong Kong) and FXI (China large caps). I'll keep an eye on the 1hr charts for a 123 Low setup.


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## peter2

Had a quick look through the my US ETF list and there's probable opportunities in two sectors that have been sold off. MJ (Cannabis) has pullback approx 50% so I'm watching for 123Low patterns on the hourly charts of MJ, CRON, CGC, TLRY, ACB. 

The other beaten down sector is oil (XLE and XOP). They are at double bottoms now and I'll need to see the 123L pattern on the hourly charts first. 

UNG (nat gas) they can't give it away.


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## fergee

@peter2 I was wondering how you interpret/use the vix in your trading? I have seen you mention it in your ASX portfolio threads.


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## peter2

I'll comment on the VIX in the WE review. 

Another trade started. This time it's in the inverse semiconductor ETF - SOXS. I've market the 123 Low in the hourly chart. Since it started well I've raised the trailing stop to reduce downside risk. 



I'll leave the T1 sell order in the market for the day only.


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## hallph

peter2 said:


> Had a quick look through the my US ETF list and there's probable opportunities in two sectors that have been sold off. MJ (Cannabis) has pullback approx 50% so I'm watching for 123Low patterns on the hourly charts of MJ, CRON, CGC, TLRY, ACB.
> 
> The other beaten down sector is oil (XLE and XOP). They are at double bottoms now and I'll need to see the 123L pattern on the hourly charts first.
> 
> UNG (nat gas) they can't give it away.




Peter - why buy, or even look at, things going down when you could buy one of the hundreds of charts going up?


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## peter2

@hallph  Thanks for the question. One of the problems people have when considering trading on the US markets is the huge number of stocks available to trade. When I scan the US markets for perfect setups there's plenty of them. I get hundreds when I only need a few. 

As this thread is in the beginners section I started with a short list of approx 30 ETFs. It's very easy to look through a short list every day before the US open and place the orders on the few possibilities that appear in the charts. 

I plan to increase the number of opportunities as the thread progresses. The first sector that I've expanded is the cannabis sector. The ETF is MJ and the main components are CGC, CRON, TLRY and other cannabis companies. Instead of looking at SMH (or SOXS, SOXL) I could look at AMD. MU and other semiconductor stocks. It wouldn't take long to expand the list to >100 stocks but would one spend the time looking through 100 charts every day like we do with 30? 

Of course I don't buy stocks going down but it's worth looking at them for possible reversal setups. The cannabis sector will rally again one day and when it does we'll be onto it. 

I hope this thread will show that one can do quite nicely with a small selection of companies and ETFs when one has a trading plan and the discipline to follow it consistently.


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## willoneau

Hi peter2, do you use IB as your broker in US?


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## peter2

This handy little feature on Trading View indicates the number of days to the next earnings report. 
I don't want to start a short term trade in CGC this close to earnings when the price tanked after the last three earnings' reports (unless I want to short it?).


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## qldfrog

peter2 said:


> This handy little feature on Trading View indicates the number of days to the next earnings report.
> I don't want to start a short term trade in CGC this close to earnings when the price tanked after the last three earnings' reports (unless I want to short it?).
> 
> View attachment 100138



That is indeed very convenient and explain why you are using this tool
I was all happy with AB and mydata feed, but i understand how this facility and maybe the days to go ex dividends can be important ?


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## peter2

Joe kindly moved this thread to this subsection of the forum as it seemed more appropriate. I intend to be more active in this thread in order to take advantage of the bullish US markets. 

I have considered a range of trading strategies for this thread and haven't settled on any one. As this thread is no longer in the beginners section I think that I can do what I like. This means that I'm not restricted to one strategy or one tactic.  The aim for this thread is to increase my US account by accumulating lots of short term results. The monthly goal is to earn +5R/mth and the base level trade risk starts at 1%. I'm going to compound profits quicker by adding 5% of total profit to the initial trade risk (max 2%) and stop it if DD gets to -4R. I'll recommence the aggressive compounding once the DD is erased. 

Living on the east coast of Aust the US markets open at the awkward time of 0130am during summer. This gives me plenty of time in the evening to find some setups to trade. I'm going to start with the Russell 3000 list. I'm going to preference the lower priced stocks as I want to get into explosive moves that can generate high R multiple results.


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## frugal.rock

peter2 said:


> The other beaten down sector is oil (XLE and XOP). They are at double bottoms now and I'll need to see the 123L pattern on the hourly charts first.



Have been wondering about oil myself. Any ideas on why the spot price is low? Was nearly 20% higher a few weeks ago.
Makes me realise, there are seasonal factors to consider.
IE, Europe, US, China (northern hemisphere) are all coming out of Winter, maybe the lower price is season based?
F.Rock


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## qldfrog

frugal.rock said:


> Have been wondering about oil myself. Any ideas on why the spot price is low? Was nearly 20% higher a few weeks ago.
> Makes me realise, there are seasonal factors to consider.
> IE, Europe, US, China (northern hemisphere) are all coming out of Winter, maybe the lower price is season based?
> F.Rock



Really???  Seen a picture of the traffic in BJ,  Shanghai or Shenzhen right now? 
*China* consumes 12,791,553 barrels per day (B/d) of *oil* as of the year 2016. *China* ranks 2nd in the world for *oil consumption*, accounting for about 13.2% of the world's total *consumption* of 97,103,871 barrels per day.


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## Warr87

@peter2 , a slight segway but I've wondered about this. When you trade your US stocks, are you opening an account in the US and transfer your money over into a US based account (effectively hedging your currency risk as well), or are you buying on the US market through an aussie broker a number of aussie brokers offer some US stocks or ETFs?


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## peter2

What do I think about the current price of oil (or anything)? 
My standard reply to this question is; I don't have an opinion, it could go up, down or stay the same for a while. I could create a narrative to explain the current lower price but this is a waste of time (unless I was paid to express an opinion). 

Opinions prevent proper chart analysis. If I've a bullish opinion then I'm looking for reasons to support that opinion rather than being open to both bullish and bearish possibilities.  

A good recent example of this was in the P2 Wkly/Dly thread. I posted a bullish setup in AMS:asx. @Trav. questioned me on this view and after reviewing the chart again I turned neutral (50:50) much less bullish than I was earlier. I even pointed out that if the gap up doesn't hold then price could fall below 1.30. As it turned out this happened. 

I'm neutral on the price of oil. I'm bullish the price of nat gas but I still have to wait for a bullish setup for a trade.


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## peter2

Most of the trades done here will be through a US based equities account. I funded the account when the AUDUSD was 0.87. I'm not concerned by currency fluctuations. 
I will also use an Aust based cfd provider for trades in larger cap US stocks.


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## peter2

There's thousands of stocks in the Russell 3000. I let you guess how many.  I need to reduce the number that appear in my scans.

1. My first step is to filter using the weekly trend. 
Wkly trend is UP:  13 ema > 21 ema and the ema (vol, 10) > 1 Mill.
This reduces the number to approx 1341. 

2. Stocks that are moving up faster than the QQQ index.
RSC(QQQ, 26)  > ma(rsc(QQQ), 26)
This filter reduces the number to approx 411. 

This is a significant reduction and it's very likely that I'll miss lots of good opportunities. Will there still be enough for me to trade? 

Tonight, it's Presidents' day holiday in the US so I'm spending some time going through last weeks scan results. Last week there were 64 1stBB results (from 411). That's only 13/day. A number 20 - 30 / day would be easily manageable.


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## peter2

Let's look at this chart example.




I've circled the last 3 x 1st BBs.
#1 formed before the weekly trend turned UP so it's missed.
#2 formed when the wkly trend is UP, RSC is above it's average, but it may have been too close to earnings (gap up 5 days later)
#3 formed just right.  (edit: and was a 3R winner)

The scan parameters can pick them but I need to see if it picks enough of them.


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## peter2

Before you get carried away by the possibilities. Look at this chart.




LOSER, LOSER, WINNER. 
Would you have taken that winner after those two losses? If you manage your trades like @tech/a then YES of course you did. The two small losses wouldn't have stopped you cashing in on the +3R winner. 

I've got to get that into my head and trade these opportunities with the utmost discipline.


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## peter2

All that pre-market work seems worth it so far. I was going to say it's already started to pay but until the money in is the bag, open profit means nothing. 

I placed six orders in the market and four of them triggered. I post the charts for you with some explanations. The scan I was working with showed all the 1st BBars that formed in the past week. 
The green/red line on the chart is the QQQ index. I want to trade trade stocks with the potential to go up faster than this index. The ST parameter on the daily chart has been changed to 1.8.

CDMO: Regulation buy the open after the 1stBB (or 2nd in this case). iSL two bars back.
MRNS: Regulation BO-HR (This one appeared when I was fiddling with the ST parameter (1.5 - 2.0)).

I'm also applying an alternate entry setup using the 1stBB. This applies when I think the initial risk is too big. I'll wait for one or two PB bars with a LH and LL. The entry will be a few ticks above the bars high. If this PB closes red the chart is deleted. 

FRTA: Shows this alternate entry condition
INFN: Shows the alternate entry condition (2nd PB bar but taken 5 days later).


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## peter2

I'm prepared to risk 5R in the market. This means I can start 5 trades. I've started 4 meaning I've risked 4R. The price action since entry allows me to raise a few exit stops reducing the open risk to 2R. This means I can start another 3 trades if there's cash available. 

I'll be selecting trade opportunities that require small amounts of capital (margin). This will allow me to start more of them with my limited capital. I'll be making use of the broker's overnight margin allowances (100%). 

A peek of the open trade spreadsheet showing the T1, T2 targets. 




I'm really tempted to grab the +2R already and hear the "ka-ching". 
I'm pleased to grab +1R in <3d and 2R in < 6d.


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## peter2

This is what @Newt and I have been talking about. Look for this pdf.

"New Ideas in Technical Analysis, The Pocket Pivot Buy Point"
by Gil Morales & Dr. Chris Kacher

Thanks for the reminder,Newt The 1st BBs that I'm scanning for can also be pocket pivot buy alerts. I might modify my scan to find them.


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## peter2

Whoops, two of the trades opened yesterday are within 6,7 days of their earnings reporting date (INFN, FRTA) according to the Tradingview indicator. I have no intention of holding these short term trades through earnings reports because the prices can jump or fall quite a lot. I'm also not going to try and guess what's going to happen. 

Re these two trades, the 1st BBs got me in before the BO-HR and they may need to be held through earnings to get the larger payoff. I would be tempted to do this if the portfolio had proven itself and had already earned plenty of profit. This is not the case as I've only just started and it's an unproven strategy. 

I could give them another few days to go higher but this is holding and hoping. I'm lucky that these two trades can give me >1R now. I'm going to take the money while it's there. 

INFN: T1 is at 8.30 and the BO level Is 8.28, price got close to it before falling a little. I sold at 8.23 and grabbed the +0.8R. 
FRTA: T1 is at 14.70 and the BO level is 14.80, price was only at 14.30, placed a sell at 14.78. I was pleased to see that price did hit this level much later in the day. Result +1.1R. I'm also pleased to grab almost +2R in one day. 

I'm not going to go through the details of every trade but I thought it worth explaining my intentions with the trade management in this portfolio. There are so many opportunities in the US markets that when I make a mistake, just exit and start another. If a trade isn't profitable in a couple of days take the small loss and start another. 

Quick profits increase the W% and allows the aggressive compounding do it's thing. The $513 profit lifts the account to $26K and a normal FF of 1% would make the next trade risk $260. However I'm adding 5% of the profit to the next trades making them risk $286. A high W% will make the trade risk increase quite quickly. A strategy like this needs a limit and a brake. The limit will be between 2-3% and the brake is a DD of -4R. 

I plan to update this thread every few weeks. I'll post a few trade examples when there's something of interest to discuss. The markets always provide something new.  I'm also considering including some shorts in this portfolio when the time is right. I may start with the inverse ETFs and I'm considering using the sp500 for my universe for shorts. I use the 1st BB to go long perhaps I could use the 1st red bar to short.


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## peter2

Welcome to the US markets P2. Today we're going to sell everything you own. We're not going sell them gently, they're going straight down.


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## fergee

peter2 said:


> Welcome to the US markets P2. Today we're going to sell everything you own. We're not going sell them gently, they're going straight down.



Yeeeha! When will you start to add shorts to your portfolio @peter2 or will you just let inverse ETFs appear on your watch list naturally as they come up?
Also I was wondering how you view/use the implied volatility index's, S&P500 and ASX200, in your trading?


----------



## peter2

The market toyed with me yesterday. It opened slightly down then tanked before rallying late in the day. The daily chart looks like nothing happened but when you're looking at intraday charts it was dramatic. I was looking to start a few more swing trades and instead of placing the orders and getting into my day trading routine all I was looking at were the mounting losses from the open swing trades. The market yanked my chain and I was flushed. 

I'm smiling now thinking about last night. This is the first time I've tried to do two things at the same time. I wasn't prepared for it. The swing trades are managed using the daily charts and I shouldn't look at them during the day. I've got to create a swing trade workspace and once the orders are placed ignore it and focus on the day trading workspaces. 

DNLI: price went straight down to the exit (-1R)
NXST: price went straight down but stopped just above its exit. Likely to lose 0.8R
CDMO, MRNS opened slightly lower but prices didn't fall further.

Checking the EOD prices and I almost fell off the chair. MRNS rallied strongly after I logged out. It gained 1R and is now >2R. 




_Summary_:  Get organised (seperate workspaces), be prepared (pre-market prep) before the trading day starts. I missed the rally in the gold stocks, stupid. 

_Current_: Took the loss on DNLI (-1R) and started swing trade on NERV. 
Four open swing trades with open heat of -1R, so it seems that I can start another 4 trades tonight (if my head is on straight).


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## peter2

I didn't feel like yelling "yeehah" last night @fergee, but something else. I acted like a newbie last night. 

Volatility index's: I keep an eye on the ASX:VIX as part of the week-end review but ignore it at other times. I don't trade it. I do trade the US volatility ETF UVXY. I mostly day trade it when the SPY goes down. Shorting the SPY requires a lot of margin as its ~330 while the UVXY is ~ 11. 

I'm still bullish the US markets and I'll mainly be looking for longs. UVXY is down near all time lows (naturally as the market are at all time highs) and I've considered buying some UVXY as a hedge, but where do I place my iSL? If I buy at 11, should I place it at 10, 9 ... ? 

I've no experience with pairs trading or spread trading (FX excluded) and prefer to stick with pure directional trades.


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## fergee

peter2 said:


> I didn't feel like yelling "yeehah" last night @fergee, but something else. I acted like a newbie last night.
> 
> Volatility index's: I keep an eye on the ASX:VIX as part of the week-end review but ignore it at other times. I don't trade it. I do trade the US volatility ETF UVXY. I mostly day trade it when the SPY goes down. Shorting the SPY requires a lot of margin as its ~330 while the UVXY is ~ 11.
> 
> I'm still bullish the US markets and I'll mainly be looking for longs. UVXY is down near all time lows (naturally as the market are at all time highs) and I've considered buying some UVXY as a hedge, but where do I place my iSL? If I buy at 11, should I place it at 10, 9 ... ?
> 
> I've no experience with pairs trading or spread trading (FX excluded) and prefer to stick with pure directional trades.




I bet it was a few choice words of the four letter variety getting thrown around 

I enjoy the vol hence the yehaaa. Volatility is like driving in the rain when there's no rain for ages and then it finally does rain everyone forgets how to drive properly.

Thanks for your opinion on it, its always interesting to hear other thoughts. I tend to use it as more of an indicator but have traded it via cfd as well.

Im not sure if your question regarding UVXY was rhetorical or not but I personally would not touch it  going long with a ten foot pole the decay is horrendous, its a short only play imo, but I guess if you are day trading it your exposure is limited. You cant buy SP500 put options or go short e-minis through your account?


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## peter2

The US markets have done it again, falling quickly after the open. I'm looking at the effects on the open swing trades instead of focusing in the current short opportunity (UVXY long). The few open swing trades were hammered again. Lessons handed to me in a gilt edged envelope (that I paid for btw, including the courier). 

MRNS: Closed 3.04, opened 2.75.
Lesson: What the market gives, it can take away. Beware the opening gaps.
If you intend to use price targets then place them in the market asap. 
If you're going to use trailing stops then be very careful where you put them. 

DNLI:  (~25.00) Be careful with the spread. The spread on this one was about 0.50 for the first 15 min and when price was falling the spread widened to 0.90 at times. I see the spread has decreased to 0.10 one hour after the open. Another trap for the newbies.

NXST: Another falling price with a wide spread of 0.40.  Still 0.30 - 0.40 after one hour. (124.00 price tag so not bad really)

If you want to sell when the prices are falling you have to pay to cross the spread. I closed all the swing trades and got some ordinary exits as I paid to cross the spread on a few of them. Seven trades closed in the past three days for +2.7R. 

The biggest lesson for me is:  Don't watch the intraday price action on the swing trades.  If I want to tighten the trailing stops then do it at least 60min after the open. 

A reason for my discombobulation could be that I normally deal near the close of the day in the ASX. I base some judgement on what happened during the day. Now I'm active in the US market near the open. OR it could be that the US market act differently (I know this) and I'm getting sucked in to reacting rather than being proactive. I've got a few days to think about it.


----------



## qldfrog

Could it be that the psychology to trade US has to be different?
in that case your wealth of knowledge here may be counterproductive?
And the real question then is: is it worth it?
 are you not better off leveraging your knowhow here?
A dollar profit is a dollar, where ever it is made be it ASX, NYSE or the Bagdad bourse 
Unless you plan to move, playing on the US market means reduced social family life with awkward hours and most probably a toll on your physical wellbeing
Playing the Devil's advocate..i hope you do not mind
I got a lot out of reading your posts, seems fair to give back a maybe naive but genuine opinion
In the best of spirit


----------



## debtfree

I've got no doubts at all Peter that you'll bounce back from these little newbie setbacks. 

I just looked at QQQ and noticed it has risen roughly 16% since the middle of Dec 2019 to the middle of Feb 2020 (2 months). 16% in a short time ... then I had a flashback

I remember the XAO had risen 800 points (roughly 16%) since the middle of Dec 2014 to the middle of of March 2015 (3 months). 
Then you took over PAV's thread with Capital at Risk 8.4%, Portfolio Heat at 15%, then the market basically headed downhill for the rest of the year.
At the end of the year (2015) Capital at Risk was 1%, Portfolio Heat was 3%, Portfolio was up 25% and Drawdown was about 7%. 

A few stocks that caught my eye over there (maybe not perfect but anyway) CLVS, EVH, PCG. All the best.


----------



## ducati916

qldfrog said:


> Could it be that the psychology to trade US has to be different?
> in that case your wealth of knowledge here may be counterproductive?
> And the real question then is: is it worth it?
> are you not better off leveraging your knowhow here?
> A dollar profit is a dollar, where ever it is made be it ASX, NYSE or the Bagdad bourse
> Unless you plan to move, playing on the US market means reduced social family life with awkward hours and most probably a toll on your physical wellbeing
> Playing the Devil's advocate..i hope you do not mind
> I got a lot out of reading your posts, seems fair to give back a maybe naive but genuine opinion
> In the best of spirit





There are a significant number of differences in the US. I was not sure that they (could/would) make a difference (hence my question to Skate) to automated trading strategies (weekly) etc.

The first (major) difference is that the US operates with Market Makers. Daytraders (certainly) start by learning to follow the Level II screens. Market Makers make their money on the spread and filling orders. Someone wants a million shares at X but price is currently at Y, what happens? This is why VWAP is so popular in the US.

The second major difference: algorithms. The US market is full of machine trading, which can create counter-intuitive price movement.

There are (many) others, but these two are enough on their own to distort the market significantly in short time frames.

jog on
duc


----------



## peter2

ducati916 said:


> There are a significant number of differences in the US. I was not sure that they (could/would) make a difference (hence my question to Skate) to automated trading strategies (weekly) etc.




Totally agree with you on the significance that the market makers and the algos have on the daily price gyrations. The challenge for me is to go with the flow intraday.

I was also unsatisfied with skate's reply to your inquiry into the performance of his systems trading the US markets. I have no doubts that the weekly CAM, MAP or Hybrid auto systems would perform very well on the US markets (*). I would even say that a 40 - 60 position portfolio targeting stocks outside the large caps (SP500) would do much better than a 20 position portfolio. It would require more work, say, an extra 20min /wk to place the extra orders. 

* - These systems do a great job of getting into a trend early and the rest is trade management.


----------



## Warr87

peter2 said:


> Totally agree with you on the significance that the market makers and the algos have on the daily price gyrations. The challenge for me is to go with the flow intraday.
> 
> I was also unsatisfied with skate's reply to your inquiry into the performance of his systems trading the US markets. I have no doubts that the weekly CAM, MAP or Hybrid auto systems would perform very well on the US markets (*). I would even say that a 40 - 60 position portfolio targeting stocks outside the large caps (SP500) would do much better than a 20 position portfolio. It would require more work, say, an extra 20min /wk to place the extra orders.
> 
> * - These systems do a great job of getting into a trend early and the rest is trade management.




This is something that I am working towards. Plan is to port my current systems into python to automate the process more (will probably still have to manually enter trades as I don't have the money to pay developers to build an API like what Nick Radge did). But I am also under the same impression as you that a 40-60 position system in either the CAM, MAP, etc., would work quiet well. The extra liquidity and low commissions makes it an interesting prospect.


----------



## ducati916

peter2 said:


> 1. Totally agree with you on the significance that the market makers and the algos have on the daily price gyrations. The challenge for me is to go with the flow intraday.
> 
> 2. I was also unsatisfied with skate's reply to your inquiry into the performance of his systems trading the US markets. I have no doubts that the weekly CAM, MAP or Hybrid auto systems would perform very well on the US markets (*). I would even say that a 40 - 60 position portfolio targeting stocks outside the large caps (SP500) would do much better than a 20 position portfolio. It would require more work, say, an extra 20min /wk to place the extra orders.
> 
> * - These systems do a great job of getting into a trend early and the rest is trade management.




1. There are two other (longer term impacts) on US markets: (a) a very deep and active Options market that will create a significant amount of hedging in common stock/index/ETF and (b) ETF rebalancing itself.

2. Yes, I would have welcomed a slightly more expansive answer, but given the IP in these systems, I guess that is the way it is.

jog on
duc


----------



## peter2

I'm too hyped to sleep, so you get another post about the US markets. 
After such a savage selloff last Friday I didn't expect many results in the 1st BB scan. Only 11 came up in the scan and only four made it through to be monitored tonight. Two of them SQ and TTD didn't produce any setups while I was watching, scratch them. 

The other two (CBB, KPTI) were both looking likely to open gap up. I don't chase the gap open but wait for a low risk setup to go long. The CBB chart had lots of recent gaps, more frequent than the quarterly earnings schedule. A quick check shows me that CBB is merging with another company and the bids have been revised upwards. I don't trade news involving mergers or takeovers as the prices are well known and there's usually not much movement. Scratch that one. That left me with my regulars and KPTI. 

KPTI was different. The news was exciting, Ph3 trial meeting primary endpoint. This should attract other traders. It didn't take off early (phew, because I was looking at UVXY) but there was a rewarding result about 1hr after the open. I took the break-out day trade (*). 100 shares got me ~$300 in ~20min.   * Note the small bars with low volume before the BO. I'm learning slowly that when this happens get in quickly.


----------



## peter2

After the slaughter on Friday I anticipated that there might be a rally or at least a choppy day on Mon so I started a swing trade short in UVXY on Friday. I shorted UVXY at 25.00 on Fri and tonight noticed that price was below 22 in the pre-market. The US rallied a little during the UK session. I logged on to the trading platform, but couldn't work out how to place an active buy order in the pre-market. 

Of course while I'm trying to figure it out UVXY was going up as the US rally had ended. There I am scrambling to find out how to place the bloody order in the pre-market as my open profits were disappearing. I finally hit the right order type as UVXY was trading at 22.72. I'd missed out on 0.80 - 1.00. Of course it opened much lower to rub it in before finally going higher. 

I've started another short at 23.00 (small pos size because anything can happen these days).


----------



## peter2

As mentioned in another thread I'm keen to short the US VIX that is sky high due to the panic. I'm trading that the current panic will subside soon. I don't know when but soon. 

I'm stalking UVXY trading at 53 and placed my orders only to see that they were rejected. What's going on? Then I noticed that my broker has made UVXY hard to borrow, which means I can't short it. Bugger. What else? Then I remember there's VXX. Punched in the code and it's OK to short, fired off my sell order and all the screens froze. WTF? Is it my PC again? Log in to the webtrader and see it's frozen also. Now I don't know if my sell order has been executed. Then it dawns on me that the 2nd exchange circuit breaker has probably been triggered. This is set at -7% and I see the SP500 dropped enough to trigger it. 

Now I wait until everything starts again. We're off and running and I see that my short was executed, great as the market has started to go up (VXX down).

Meanwhile I was also stalking a reversal long in a few oil stocks. The main one I look at is XOM. Placed a buy stop order at 42 with a huge iSL at 41. Happy to get a quick $1 to $1.5 with my target at 44. Pleased to see that price hit the target in three minutes. I'm out and going home. 




Wait, I just realised that I am home. All this volatility is getting to me. It's better than adrenaline. 

The market is still going higher and UVXY is now 46. A quick +7 but I'm not on it. 
VXX has only dropped to 37 (+3). This is not a day trade and I hope the panic settles quickly in the next few days.


----------



## peter2

Just a note to mention that I've closed the VIX trades last night, when prices started to go against my preferred direction. Looks like the sellers are still in control as the current pre-market prices indicate a gap up open (market going down further). I'm still keen on the idea that the markets will settle down soon, but not tonight it seems.


----------



## peter2

I'm looking at the behaviour of the CBOE VIX during the GFC as my model. The VIX spiked quickly in the initial price selloff then decreased slowly even as prices fell further. The VIX spikes very early, in the first 20% then slowly settles as people adjust to the inevitable bear market. 

The VIX topped out at 96, but was extremely volatile between 55 - 96. Even though it's a high probability trade getting the timing right is almost impossible. Options are probably the best instrument to use because of their limited risk (provided the liquidity is available when you need them).


----------



## peter2

I want to do something a lot more constructive and hopefully more rewarding in this thread. 

The thread started with the dilemma of too many opportunities in the US markets so I narrowed down the opportunities to a small list of ETFs. This small list took up minimal time to review for possible opportunities. I outlined the setups. We traded a few and started well. The inclusion of inverse ETFs allowed us to profit when the market went up or down. Well, that was the idea.

Did this thread profit from the sudden selloff?  Unfortunately, no. The selloff was so sudden that there was insufficient time for the price action to form our chart setups. The subsequent increase in volatility that accompanied the panic selling increased the traders risk so significantly that it was difficult to join in late. Of course, we never chase the market. 

Naturally I'm disappointed that the thread's TP didn't produce the goods on this occasion. Actually, I'm a lot more than disappointed, so something has to change. 

I recall the success of the 40 position ASX portfolio and wonder if I can repeat it in the US. That was a long only portfolio because that's what most people manage. However I don't have enough funds in the US account for a 40 position portfolio even with the low brokerage costs. I'm not going to paper trade a portfolio. I want to earn more USD and at a substantially greater rate than 10 - 20%pa. 

How about a portfolio with a combination of longs and shorts? The account has enough for 10 - 15 positions. How about we establish a number of positions to start and add more when we can? 

This will require a new TP and a lot of thought into preparing one.


----------



## peter2

If you've read my ASX portfolio threads then you'll be familiar with how I use a market filter in a long only portfolio. The filter guides my trade management and helps me manage the total portfolio heat. When the market filter is downgraded it's time to tighten the exit stops and reduce the number of open positions. This is very helpful in a long only portfolio but will it help in a portfolio with both long and shorts?

ATM it doesn't because all I'm considering is the bullish sentiment in the market. I could consider the bearish side when the filter is downgraded but it may be too late. Thinking about the sudden selloff in the US markets I didn't consider the bearish case at all. My outlook was biased. It's not an easy thing to create and maintain a balanced outlook on the market. There are too many psychological biases to overcome.

If a long/short portfolio is to work then we require an objective indicator to guide the number of longs and shorts in the portfolio.

In a bullish market we may have 8-10 longs and 0-2 shorts.
In a mildly bullish market we may have 5-7 longs and 3-5 shorts.
In a mildly bearish market we may have 3-5 longs and 5-7 shorts.
In a bearish market we may have 0-2 longs and 8-10 shorts.

I'm interested in your thoughts on what we may use.


----------



## qldfrog

First of all, i would avoid rushing into hasty decision:
A recipe for disaster.
Then i wonder how you can efficiently mix short and long thinking in a portfolio
Isn't it going to be a mind game and an uneasy one?do you go with 2 pass one long one short, i think you are asking if not for trouble at the very least for a big challenge.
I understand that by going both long short you maximize your fund which are pooled.
Maybe a possibility
Total fund split in two
On paper one long and one short portfolios.
Allocated 50pc on long 50pc on short, avoid ETF
Even on falling market you can go long: gold for example or funeral parlour
And even when market rise again you can short some
gold for example or funeral parlour 
That way you always manage 50pc long 50pc short
With 2 separate (on paper but can use same account) portfolio and mental setup..have a cuppa between working on either
Would that help?


----------



## peter2

@qldfrog Thanks for your reply. Two separate systems, one long and one short operating independently is one solution. The systems would have to be completely mechanical to avoid being influenced by my psychological biases. 

Without any market filters the short system will lose money in a bullish market and the long system will lose money in a bearish market. There will be sector and stock exceptions as qldfrog mentions. Other than relying on luck one would need a robust top down analysis to be able to recognise the weak sectors for shorting in a bullish market and the strongest sectors for longs in a bearish market. 

The lower the number of positions in a portfolio, the more we rely on luck for our performance. This is something that I want to minimise and the only way to do it is to open more positions. Unfortunately the starting capital won't allow me to operate 20 longs and 20 short trades. This is where back-testing would help.


----------



## Newt

What fascinates me Peter2 is that you not only openly share your thoughts before starting a new portfolio, but also openly admit where and what you learn by pushing yourself into new arenas.  I don't like to bias your final decision, but frankly any of the options (for long and/or short trading) you've described would be valuable to see in action in US market.


----------



## qldfrog

I have to admit that i know nothing about the US market.
I use it to have an exposure to USD and access to areas, stock we can not access in oz: research, ETF, ,electronic etc
I do not do any charting trending on that market..
Just to highlight how wrong i could be...


----------



## tinhat

Any song requests?


----------



## peter2

I haven't forgotten this thread. It's just that I've been flattened by a roundhouse punch that I should have seen coming (virus selloff), been chin tagged by some swift jabs (gold selloff) and had my air knocked out by a fierce body blow (trying to buy the bottom on CCP). I'm off the canvas and looking around to see what is going to happen next. 

The setups for the imminent long/short portfolio will be based on the 1st BBs and 1st RBs on my charts. The price bars on my charts are coloured blue/red based on the supertrend (ST) indicator. The ST indicator calculates a value above and below the current prices based on a multiple of the average true range (ATR) of the price bars. When price closes above the upper ST value the bar is coloured blue and it's a buy alert. When price closes below the lower ST value the bars are coloured red and it's a sell alert. I've always used a medium period of 21 days for the ATR(21) and I've been comfortable with the changes on the charts. 

Adapting to current market conditions. 
The huge increase in volatility and price movements have made my normal settings for the ST indicator unsuitable as the medium values are much too small for the current volatility. I've started using 2 x ATR(7) on the daily charts as this allows more room. 

The underlying tactic for using this indicator is to identify a significant increase in price movement in periods of low volatility that might be the start of a much larger price movement.  Typical examples are the obvious BO-HR bar and the moves when a corrective pull-back has ended. 

When volatility is high (like now) the R:R of these setups is mostly unacceptable. I must wait for the volatility to subside. It's the same underlying tactic of a Darvas BO, O'Neils "pocket pivots", the CAM blue/green bars. Other means of identifying this price action uses the parabolic stop and reverse (PSAR) indicator, count-back lines and the horizontal and sloping resistance lines that define BOs.  I can hide the ST indicator on my charts and avoid the clutter than the dots and lines produce.


----------



## peter2

I've got remaining issues to resolve concerning the trade plan and I'll discuss this later. 

While I think of it and before the US opens tonight I want to record a few long positions in this long/short portfolio that I've mentioned elsewhere. 

This portfolio will start with an account balance near $25K. This account is used for both swing and day trading although I'm only going to report the results of the swing trades in this thread. I have mentioned that this account will be traded a little more aggressively.  Now that the AUD is so weak lets earn as many USD as we can. 

The positions I want to record now are both long leveraged gold ETFs. 
Bought *NUGT* x100 @ $6 = cost $605
Bought *JNUG* x100 @ $4 = cost $405. 
These positions have no SL. They can go to zero but that's highly improbable. If they fall lower it's likely that the administrator would consolidate the number of shares (reverse split) to allow more price movement. 

This means the current portfolio heat is 4% long and nil short. 

I am considering buying other commodity ETFs at the lower prices rather than stocks atm. The recent strength in the USD has seen many commodities fall rather a lot.  
ERX (energy bull x3) ???  The Saudi's have more money than me. (The market can stay irrational far longer than I can stay solvent.)


----------



## InsvestoBoy

hey @peter2 did you see there was some discussion on twitter about JNUG and NUGT?

See this thread:


and update:


----------



## InsvestoBoy

peter2 said:


> I am considering buying other commodity ETFs at the lower prices rather than stocks atm.




Commodity ETFs suck if the underlying futs are in contango.

See USO or UNG.

Why bother when you can buy the likes of Glencore, Freeport McMoran, BHP, US Steel, Exxon, etc? They also have decent options market if you want the leverage with no stops feature.


----------



## peter2

I did buy some UNG last night and closely considered USO. Missed the BO on USO for a day trade. 

I consider companies to have more risk than commodity markets at the moment. Many companies will start to report virus cases and have to isolate and quarantine entire crews. Larger companies will be able to cope better than smaller ones. 

Yes, I agree that the options markets are the most suitable instrument for this type of activity. I know some of the basics and have a C.Schwab option account somewhere. It might have gone to the US last I heard. I've decided to not fund it. 

ps: I couldn't resist the urge to ask what's twitter?     Good to see others see the same potential.


----------



## Warr87

peter2 said:


> I did buy some UNG last night and closely considered USO. Missed the BO on USO for a day trade.
> 
> I consider companies to have more risk than commodity markets at the moment. Many companies will start to report virus cases and have to isolate and quarantine entire crews. Larger companies will be able to cope better than smaller ones.
> 
> Yes, I agree that the options markets are the most suitable instrument for this type of activity. I know some of the basics and have a C.Schwab option account somewhere. It might have gone to the US last I heard. I've decided to not fund it.
> 
> ps: I couldn't resist the urge to ask what's twitter?     Good to see others see the same potential.




I wasn't trading at the time, but from what I understand even in 2008 during the GFC, it was a great time for commodities. 

And FYI, I know some quant systems use things like twitter for a sentiment index to include in their buying rules .


----------



## peter2

Direxion is responding to the increased volatility by reducing the leverage on a few of its ETFs.


----------



## InsvestoBoy

200, -200 or you know, just whatever


----------



## qldfrog

that easy..... just change the rules as convenient
this is terrible


----------



## peter2

Another example that we live in interesting times. 

The change happens May 19th and I don't expect I'll still be holding them. POG is refusing to rally on it's own and seems to be waiting for a bounce in the US markets.

I suspect many ETF administrators are scrambling behind the scenes with the increased volatility. 

You may not be aware that a few weeks ago a volatility ETF, TVIX consolidated (reverse split) because the price was getting low as the market made new highs. It split 3:1 I think. I remember it was $15 then, overnight it went to $45. This was just before the market tanked and volatility went through the roof.  TVIX went to the moon ($999.90).


----------



## peter2

This is why my positions in the 3x leveraged ETFS, NUGT and JNUG aren't going as high as they should. Gold has had two huge up days and the ETF prices haven't reflected this fully.

From the Direxion website:




This problem was probably the cause for the significant falls of both JNUG and NUGT near the US close last night (23/3) when the POG didn't fall.

If the administrator's having problems behind the scenes then I don't want to be involved in a trade of that instrument. My positions were only small (4% of the account) and are currently +1.2%. If they're having problems then I'm unable to use a tight trailing stop. Close out or continue ?

ps: Are the twits whinging?


----------



## ducati916

The 'miners' are not following the 'physical'.

Physical gold is a hedge against current situation. The 'miners' are not, or less so.

jog on
duc


----------



## qldfrog

peter2 said:


> This is why my positions in the 3x leveraged ETFS, NUGT and JNUG aren't going as high as they should. Gold has had two huge up days and the ETF prices haven't reflected this fully.
> 
> From the Direxion website:
> 
> View attachment 101668
> 
> 
> This problem was probably the cause for the significant falls of both JNUG and NUGT near the US close last night (23/3) when the POG didn't fall.
> 
> If the administrator's having problems behind the scenes then I don't want to be involved in a trade of that instrument. My positions were only small (4% of the account) and are currently +1.2%. If they're having problems then I'm unable to use a tight trailing stop. Close out or continue ?
> 
> ps: Are the twits whinging?



This fact was raised by @InsvestoBoy i think in another thread..it is disappointing to see rules changing under your feet indeed.


----------



## peter2

Direxion has changed their minds again and have brought forward their planned reduction of leverage from x3 to x2 to tonight March 31st instead of May 19th.  I'm out thankfully. 

The recent volatility has crushed all of these x3 leveraged ETFs. The under performance of these ETFs was only seen in the medium and longer term but the recent huge increase in volatility has seen their poor performance being exposed daily. 

They won't be worthwhile trading until Direxion reset them to higher values with a reverse split (consolidation).


----------



## peter2

Why we have to be careful trading COVID-19 companies.


----------



## peter2

I have not forgotten the US markets even though I haven't posted here for a while. I day trade the US a few times each week and I'm currently doing some forward testing of a 1st BB swing system that I intend to use in the new year. The ASX spec portfolio has done so well that I'm going to trade US spec stocks in a similar portfolio style starting with approx 12 - 15 positions. I'll add more if it starts well. My universe atm is the bottom 1000 in the Russell 3000. They're not totally rubbish like the OTC markets. I always need plenty of other traders to allow me to profit and exit my trades.  

Things are going well, as they always do when there's no money involved. Then I came upon this chart... OVID



	

		
			
		

		
	
 . . .  Drug company awaiting results of trial.
 Nice break-out with above average volume. The 1st BB also with high volume was earnings. I didn't see this chart yesterday so could not buy it on the next open which ended as a down day with very high volume. That's ugly and I would handle this by buying when price trades back above 7.00.  Seeing as the US is open I punched OVID into Tradingview. 




	

		
			
		

		
	
  Yep, OVID has opened 55% down. Yikes. Their ph 3 trial failed to meet the endpoint.

I think a few people knew the results yesterday (high volume down day) and sold before today's public announcement. 

 This is a -3.7R loss and reminds me of what can happen. Spec stocks always provide thrills and spills.


----------



## peter2

*US Spec Portfolio*:  I'm going to establish a US Spec portfolio using similar methods I'm using for the ASX Spec portfolio.
The abbreviation "Spec" is short for speculative. Typically, low priced equities that occasionally show a rapid increase in price that usually disappears just as quickly. Very occasionally price may turn into a medium term trend. It's preferred that the stock prices move on company news or sector outlook rather than follow the main index. Movement of the main indices can't be ignored and I'll be looking for equities that are stronger than the index (RSC(QQQ)).

The ASX spec portfolio is going so well that I've spent more time looking at the US markets again. I've been meaning to do this for some time but it's been hard going settling on a strategy and finding the right universe of stocks. Most strategies I researched produced great winning trades, but I also had to wade through what seemed like about 10 duds for each winner. The US markets are just so big. I haven't yet found a filter to weed out many of the duds. 

I'm excited, too excited to sleep. I've had a break through. I came upon a universe of equities that seem to behave how I want. I'll need to refine it some more but I should be able to start with the Russell micro caps. The second aha moment came when I _combined_ the three strategies that I was researching. It's the same three strategies I use in the ASX. Sound familiar? I've always liked @Skate's hybrid approach. 

I'm not going to go into many details at this stage as I've posted many comments in this and my other threads. The setups will be pull-backs, pocket pivots and break-outs. The entry triggers will be CBL(2), 1stBBs, HVBBs and box breakouts. 

I'll spend tomorrow (that's today) writing out the trading plan. I intend to start forward testing immediately with a small amount of capital.


----------



## Newt

Its exciting to hear you're excited Peter2 
I happened to take in Chat with Traders podcast#205 this week - Michael Katz from Seven Points Capital.

Reading what you've shared above reminded me of a small section near the end of the podcast where Aaron Fifield asks MK what he sees as the attributes of the best traders.  People can listen for themselves from 47:37, or briefly these people tend to:

*  Have an entrepreneurial mindset, always adapting​*  Very aware of performance and their stats​* Do more of what's working, cut out the mediocre trades​*  Have a good understanding of what it is they do well, and​_*  What segments of the market they read well, and they focus there_​
The positive feedback and energy from yourself, Skate and others here is impressive and there are probabaly lots more  reading along learning and being encouraged/energised.  Many thanks.









						205 · Day Trading—The Questions You Want Answered w/ Michael Katz
					

Michael Katz, equities trader and managing partner of Seven Points Capital, returns to the podcast. This time, answering your questions on: Strategy, Trade Management, Development & Prop Trading.




					chatwithtraders.com


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## peter2

All that enthusiasm I had last week-end is all but gone. Luckily I've got a bagful and can grab some when I need it. Traders must have a supply handy because the market will wear us down if we let it. Why am I off the high? Well, the market went sideways and my trades went up and down and ended with nothing to show for the week's work. Don't we hate that. 

I'm also still battling with the sheer volume of opportunities in the US markets. Oh, there's another annoying behaviour that the US markets show. 80% of the stocks move in a similar manner to their index. Even in the micro cap sector, stocks have a tendency to follow the index once the glow of specific corporate news has passed. This is a problem for two reasons. Firstly, the number of opportunities vary greatly depending on the price action of the index. Secondly the follow through after being triggered varies considerably and also depends on the price action of the index. 

Two examples. When the index has a minor dip and starts to rally there are hundreds of perfect setups and there's great follow through. The strong stocks hit high targets while the weak stocks hit lower targets. Relative strength is key and must be included in the system. Last week the index paused in their moves higher and most stocks (80%) also paused. This isn't a good time to start lots of new trades. The opportunities dried up and those that did trigger didn't go very far. 

_In summary_: I think I've got to analyse the index first (market type, mood, style), then scan the stronger stocks for the setups that are suited by the current market type. Refine. modify, refine and modify.


----------



## peter2

I totally understand why some people prefer to trade just the US indicies or a few sector ETFs or a small number of familiar companies. I know that if I had traded the small list I posted near the beginning of this thread I would have had plenty of opportunities, some great results and earned a reasonable profit for the work.


----------



## peter2

Ducati's comments deserve to be posted in this thread for later reference. 



ducati916 said:


> As I'm sure you realise, there are some serious differences structurally in US markets:
> 
> (a) Market Makers (these chaps WILL RUN stops intra-day);
> (b) Prop Shops (run time and type strategies throughout the day) you need to be aware of their propensities (larger ones);
> (c) Federal Reserve;
> (d) Hedge Funds & Algos skimming the spread (front running);
> (e) Hedge Funds running quant;
> (f) Indices Arbs;
> (g) Options market;
> (h) Futures markets;
> (i) Arbs from both markets (above);
> (j) ETFs;
> (k) Mutual funds;
> (l) Social Media based traders;
> (m) Other
> 
> 
> Then you have the very defined trading periods in the day:
> 
> (a) Pre-market (increasingly everyone);
> (b) Open; (Prop Shops, Algos)
> (c) 10am zone;
> (d) lunch; (half-wits);
> (e) pre-close (Prop Shops, Algos)
> (f) close (Arbs)
> 
> What has become increasingly apparent is that the monitoring of social media is now a requisite or at least some live scan during the day to catch movers. Part of the problem (for day traders) is that the social media crowd operate in the Options markets for leverage, which transfers to equity markets as MM adjust their books. The 'timing' is very squiffy, which can really play havoc with a 'trend' in swing trades.
> 
> What I used to do was trade Corporate news. On any given day, someone is releasing news that has the potential to be market moving. You identify at the w/e those companies releasing through the week and select a shortlist for each day, the ones you think will fly. Jump on as many (or few) as you can each day. The momo lasts at least for an hour or so, sometimes longer, enough anyway to profit. Earnings season is obviously a rich environment for this type of trading. Obviously (or maybe not) the time of day that the release is issued can have quite an impact. Pre-market are probably best (although that may have changed now with so many trading the pre-market).
> 
> Swing trading is a tough one. Hard to keep it tight. May need to give each position more breathing room, which if it turns to custard, creates issues. Most of the successful chaps that I am aware of, limit the duration of the position via exiting on targets rather than trailing stops etc. which makes the average swing trade just a few days or so. Personally, I think this is the toughest time frame, just so much can go wrong, especially in the wrong sector at the wrong time (biotech!). ETFs are more 'stable' but you (as stated) are giving up returns as compared to the outperforming constituent stock superstar. I'd love to see some of @Skate systems operating in the US markets. He has said that in backtesting they performed well.
> 
> The longer term is a niche that sits most comfortably with me now.
> 
> 
> I'll be following your experiment, methodology, with interest.
> 
> jog on
> duc


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## peter2

I'm disappointed that I've not documented a consistently profitable approach for trading the US equity markets in this thread. I think it's because I've always considered trading the US as a hobby rather than a serious activity. I pay my expenses and grow my capital trading the ASX market. I've been closing accounts that I haven't used in a while and am considering closing the US account as well. However in the recess of my mind there is a nagging feeling that I haven't proven myself in the US yet. It's an itch that needs to be scratched. 

I've mentioned elsewhere I could use the US account to have a bit of fun. I did consider entering a trading comp and the idea to develop a combined long/short portfolio. Everybody needs a hobby, so why don't I make mine earn some pocket money? 

I would like a trading activity that doesn't take up very much time and mostly swing trades but allows me the flexibility to day trade when I want and to occasionally risk a little more when I've a high conviction opportunity. I would like to earn much more than the easy 10-20%pa say 50-100%pa. Just for fun?

I've circled back to an idea that I had at the start of this thread. That is, to swing trade a small number of ETFs. I monitor the US indices and many commodity markets because it helps me trade the ASX. Why not trade these ETFs and earn a little extra. 

That's what I've been doing since late Jan22. The list comprises the four main US indices and their ETFs, some commodity ETFs, inverse ETFs and some of the main US sector ETFs. The list currently has about 55 entries. Many of these entries are duplicates or alternatives. 




A top portion of the list. The colours keep the list sorted into their groups.


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## peter2

I realise that by not outlining my trading process, this thread becomes just another journal with little educational content. My excuse is that the process is still under development. This should be competed before the end of March. I'm developing a flowchart that shows the process that allows me to do a little or a lot. This means that when I'm distracted and with little time I can just focus of the top 4 ETFs. Buy the strongest or short the weakest. Whatever my directional bias is at the time. No need to look through lots of charts. 

When I've more time I can review the commodity ETFs then the US sector ETFs and then perhaps look through the US sector watchlists to trade the strongest or weakest stocks in that sector. I'll determine my directional bias for most ETFs on the week-end. 
eg When I'm bullish copper (like now), I could trade the *COPX*-ETF or I could trade a copper producer (eg *FCX, SCCO, WRN*) and watch the ASX copper stocks (*OZL*, *SFR*, *29M* and assorted explorers) for bullish setups. 

I started this activity in late Jan and the results were a massive +$4 for the month.


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## peter2

*Feb 22 update*:  with one more day to go. 




100% winners for a gain of 6.3%. 11 trades for +11.2R Grabbed lots of small wins but they add up. 
The wins were small because I used larger iSL sizes due to the increased market volatility and the TR value was only 0.5% ea.

When the market volatility decreases I'll use a TR of 1% per swing trade (0.5% per day trade). 

In order to reach my minimum goal of +50%pa I must average +4% each month.
In order to reach +100%pa I must average almost 7% each month. 

I plan on outlining my process for educational content when I'm comfortable with it. I will post a few of my higher conviction opportunities when they form.


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## peter2

I know what I want to do, not exactly how I'm going to do it. Allow me to post my thoughts as I do the weekend review.
Each weekend I will review the top20 list that I posted earlier. I only need to find a few ideas for the week.

(i) Determine directional bias from the weekly charts. Focusing in on the current trend, overall formation and the last few weekly candlesticks.
(ii) Determine the strength or weakness of the instrument relative to the SPY.
(iii) identify a trade opportunity on the weekly chart or wait for one to form on the daily chart that agrees with my directional bias.
(iv) I can trade the weekly charts but that won't help me reach my yearly goal. Daily swing trades and an occasional day trade is what I need.

*US indices *: Directional bias is down on all four. The strongest is DOW, weakest Russell.
However, last week's bar was a hammer, bullish reversal. Seen on all four charts.
Trade Opp. is to go long above the bar and iSL at the low. However the risk size is too big using the weekly bar.
*Look for a smaller sized setup to go long during the week*. I'll look at TQQQ, UDOW and UPRO for this setup.

*Inverse/VIX  ETFs *: No directional bias as prices going sideways with last bar a bearish one.
VIX is midrange on the daily charts and could go either way due to current Russia/Ukraine situation.
*If VIX spikes high enough I'll short it again (UVXY, VXX). 

Commodity ETFs* : Aim with these is to get in as soon as the trend starts. I'm too late for oil, nickel, base metals, tin.
This may mean a reversal or to find something in a consolidation (Break-out, HVBB)
The second best setup is the first pullback or pause after the BO.

COPX: Long and strong. Too late now.
DBB: Long and strong since the BO in Dec21. Already had 2 pauses/PBs.
FAS/KRE: Banks, huge bullish hammer. *Look for a smaller sized setup to go long during the week*.
GDX/SLV: Long and strong, volatile. *Look for a smaller sized setup to go long during the week*.
JJN : Nickel, Long and strong since pullback late Dec21. 
LIT: Down trend, one bullish bar only. *Need a HL on daily chart for reversal trade. *
UNG: Nat gas. Volatile bugger, wait for another low
URA: Uranium, going sideways, bullish engulfing last bar, *Need a HL on daily chart for reversal trade. *BO-NH on UEC, URG
XLE/USO: Long and strong since Jan22. *Intraday longs only *

That didn't take too long and provided quite a few trading opps for the next week. I'll note them and keep an eye on them before each US open. Just remembered to add WEAT, CORN, SOYB to commodity list. Any others worth adding?

REMX: Low volume, tends to follow LIT but is currently stronger
MJ: Cannabis, strong down trend
SOXL: Semiconductors. Currently long and waiting to add more. Bullish this sector, but needs a rising market.
TAN: Solar, currently going sideways last bar bullish engulfing, interesting.

*US Sector ETFs *: Won't look into these as I have enough opps to monitor next week.
I did sneak a look and noticed lots of bullish bars similar to the major indices.


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## qldfrog

peter2 said:


> I know what I want to do, not exactly how I'm going to do it. Allow me to post my thoughts as I do the weekend review.
> Each weekend I will review the top20 list that I posted earlier. I only need to find a few ideas for the week.
> 
> (i) Determine directional bias from the weekly charts. Focusing in on the current trend, overall formation and the last few weekly candlesticks.
> (ii) Determine the strength or weakness of the instrument relative to the SPY.
> (iii) identify a trade opportunity on the weekly chart or wait for one to form on the daily chart that agrees with my directional bias.
> (iv) I can trade the weekly charts but that won't help me reach my yearly goal. Daily swing trades and an occasional day trade is what I need.
> 
> *US indices *: Directional bias is down on all four. The strongest is DOW, weakest Russell.
> However, last week's bar was a hammer, bullish reversal. Seen on all four charts.
> Trade Opp. is to go long above the bar and iSL at the low. However the risk size is too big using the weekly bar.
> *Look for a smaller sized setup to go long during the week*. I'll look at TQQQ, UDOW and UPRO for this setup.
> 
> *Inverse/VIX  ETFs *: No directional bias as prices going sideways with last bar a bearish one.
> VIX is midrange on the daily charts and could go either way due to current Russia/Ukraine situation.
> *If VIX spikes high enough I'll short it again (UVXY, VXX).
> 
> Commodity ETFs* : Aim with these is to get in as soon as the trend starts. I'm too late for oil, nickel, base metals, tin.
> This may mean a reversal or to find something in a consolidation (Break-out, HVBB)
> The second best setup is the first pullback or pause after the BO.
> 
> COPX: Long and strong. Too late now.
> DBB: Long and strong since the BO in Dec21. Already had 2 pauses/PBs.
> FAS/KRE: Banks, huge bullish hammer. *Look for a smaller sized setup to go long during the week*.
> GDX/SLV: Long and strong, volatile. *Look for a smaller sized setup to go long during the week*.
> JJN : Nickel, Long and strong since pullback late Dec21.
> LIT: Down trend, one bullish bar only. *Need a HL on daily chart for reversal trade. *
> UNG: Nat gas. Volatile bugger, wait for another low
> URA: Uranium, going sideways, bullish engulfing last bar, *Need a HL on daily chart for reversal trade. *BO-NH on UEC, URG
> XLE/USO: Long and strong since Jan22. *Intraday longs only *
> 
> That didn't take too long and provided quite a few trading opps for the next week. I'll note them and keep an eye on them before each US open. Just remembered to add WEAT, CORN, SOYB to commodity list. Any others worth adding?
> 
> REMX: Low volume, tends to follow LIT but is currently stronger
> MJ: Cannabis, strong down trend
> SOXL: Semiconductors. Currently long and waiting to add more. Bullish this sector, but needs a rising market.
> TAN: Solar, currently going sideways last bar bullish engulfing, interesting.
> 
> *US Sector ETFs *: Won't look into these as I have enough opps to monitor next week.
> I did sneak a look and noticed lots of bullish bars similar to the major indices.



Just want to add:
I really understand you
 the beauty of US ETF is that they give you long access to shorts: so for systematic traders, a one size/system set fit all:
If copper goes up i can go long a copper ETF in a trending system, if it goes down, i can use an inverse etf and go long on it.
So just define your realm and launch your system, the lot with very low brokerage fees
And so easy to buy sell US shares at market.
I am not system trading the US market but it is very tempting.
But first for me: focus and trying to be profitable on the asx.
Looking forward to follow your experience


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## peter2

Quick update on this weeks work for the US markets. (Ideas highlighted in orange, only)

*US Indicies:* Bullish until price closes below halfway of last weeks bar.
We got the down day that we wanted and now I'll go long if yesterday's high is breached. Looking for the strongest market. It'll either be *TQQQ* or *TNA*.

*VIX:* Spiked higher yesterday, just a little more tonight and I'll start a short.
Looking at *UVXY* > 22 or if I can't short that one (sometimes happens), *VXX* >28

*Banks*: Crashed and burned Tues. Closed too low to remain bullish. the time will be right soon.
_Note_: Saw talk of US defence stocks in demand. Checked *DFEN*, yep blasted higher, too late. Would need to see VCP here.

*Commodities*:
*LIT*: Got the down day, Buying up through 77.20
*URA*: Gapped up, fell, no long setup yet. ASX uranium stocks all up again. Think I missed it this time.
*OIL*: Wow, +10% in a day. Has to be a good short in there soon or it could be another +5% day, Very volatile.
*GDX,SLV*: gapped up, pretty volatile currently.
*TAN*: Continued higher, waiting for pull-back for better R:R setup.

That's it. All up once I've planned the ideas for the week it takes very little time to check them before the US opens.

Sometimes I'll have more time and I'll look through the other ETF charts and maybe get into the strongest stocks in the sector. Looked into the solar sector last night and realised I should have looked before starting one trade. Story for another day.


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## peter2

*US Market Week-end Review*: 



peter2 said:


> (i) Determine directional bias from the weekly charts. Focusing in on the current trend, overall formation and the last few weekly candlesticks.
> (ii) Determine the strength or weakness of the instrument relative to the SPY.
> (iii) identify a trade opportunity on the weekly chart or wait for one to form on the daily chart that agrees with my directional bias.
> (iv) I can trade the weekly charts but that won't help me reach my yearly goal. Daily swing trades and an occasional day trade is what I need.




*US Indices*: Two weeks ago we saw the reversal hammers in these charts. Normally considered bullish but there was no follow through bullishness last week. Last week's bars are small bearish bars. We could remain bullish as the low of the hammer hasn't been taken out and trade long using last weeks action as a minor pull-back. OR we could be bearish with the current daily trend. 
Strongest - Dow, Weakest - QQQ ; Value stocks stronger than growth stocks, 

No one likes these either/or situations. The probabilities are even or one side is not big enough. We can avoid these situations by looking for easier charts to trade. My trading opps here would be intraday only and to trade with the current sentiment (bearish). 

*VIX ETFs : * Slowly going higher. Will watch for spike up for shorts on *UVXY/VXX*. 
Currently long UVXY as an offset to a losing SOXL positions. 

*Assorted ETFs *: 
SOXL/SEMI:  Bearish and we're not at a bottom yet. 
COPX : Strongly bullish. 
CORN : Bullish, becoming too volatile at these levels. 
DBB : Base metals, strongly bullish, if you aren't in already, missed it.
FAS/KRE : Banks, crushed last week, near lows. I can't short them, so I'll have to wait for reversal setup. 
GDX, SLV : Gold/silver, hi ho, up and away
JJN : Nickel, flying high, like Icarus
LIT : Lithium, bearish, but I can't short this due to bullish fundamentals, will have to wait for bullish reversal setup. It's interesting that SQM chart is so bullish while ALB is bearish. There's something there that I'm not aware of. Anyone? 
SOYB : Looks at the end of a strong bullish trend. 
UNG : Nat gas, it all depends on Russia, so out of my hands as it would be a gamble. 
*URA:* U308, major panic selloff on fire near Ukraine nuclear facility. This could be a setup for bullish swing.
WEAT : Wheat, futures continue to having limit up days. Very volatile.
*XLE/USO* : Oil, this is going to open with a huge gap up on Mon, possible intraday short for me at the high price

ARKK : Must be giving Cathy nightmares by now. 
BITO : Come in spinners
*CIBR* : Stronger than the QQQs, may provide bullish setup if market helps
*DFEN* : Defence, bullish (LMT, NOC) 
*IYR* : Real estate, looking bullish off low
*TAN* : Bullish,  watching SEDG, ENPH 
*XLV *: Healthcare, bullish 
Fertilisers : MOS, LXU, NTR for intraday longs. 

The charts I'll be watching closely this week for setups are highlighted in orange.


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## frugal.rock

peter2 said:


> Anyone?



Chilean Gov ? ALB
Earnings beat ? SQM


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## frugal.rock

peter2 said:


> JJN : Nickel, flying high, like Icarus



JJN
Surely the wax melts soon....incredible. 🤯
Must be some kind of ETF and commodity  record... ?

15 minute bars.


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## peter2

*Intra week update*:  A couple of ideas that I posted before Monday's open worked out for me and a couple ideas triggered today (Tues).


peter2 said:


> My trading opps here would be intraday only and to trade with the current sentiment (bearish).



Good intraday short here on *TQQQ* as the day turned into a trend down day. I got +2.8R. 
I've gone short again today but not expecting much of a move today after yesterdays large move down. This short is an offset to a losing *SOXL* long that I'm stubbornly holding. The open positions keep my attention on the charts.



peter2 said:


> Will watch for spike up for shorts on *UVXY/VXX*.



Surprised that *UVXY/VXX* didn't spike higher as the market fell, but it did gap up and I hadn't included that. Still surprised though.
Tues. VIX did spike up and I have started a short on *UVXY* at 23. I'm prepared to add to this if it goes higher (~25 - 26). 



peter2 said:


> *XLE/USO* : Oil, this is going to open with a huge gap up on Mon, possible intraday short for me at the high price




*XLE* shorted for a small win +0.9R. Most of this move occurred pre-US open and I was lucky to get some in the US session before it rallied to new highs. The better outcome would have been to short Oil during the UK session. 


peter2 said:


> *TAN* : Bullish, watching SEDG, ENPH



All three gapped up with the two stocks falling all day with the market. 
However they gapped up again Tues and triggered swing trade on *TAN*. 

I like to follow up when I post trading ideas to show that most ideas don't even form a trading setup. I'll post my WE reviews occasionally and will post follow ups. I don't want to post a series of winning/losing trades as there's no real educational value unless you're trying something similar. 

*Today's session reminded me of the importance of preparation for the trading day. It's got to be done before you open the trading platform. Once we open the platform we're overwhelmed with data jumping up and down all over our screens. It's so easy to lose focus. I'm doing a mixture of swing and intraday trading. The swing trade orders are placed are before the market opens. Once this is done we can settle on a few charts with our favourite intra day trading opportunities. If the intra-day ideas don't form trading setups then we can monitor the swing trades and make minor adjustments where possible. *

eg. Today *TAN* gapped above my buy limit stop. I noticed the bullishness and decided to pay the extra 0.50 to get into the swing trade. I also reduced the size of the iSL allowing me to increase the position size.  btw: Both *SEDG* and *ENPH* also gapped up over my orders and  both are sizable positions within *TAN.* I went with the *TAN* trade only. I am already long *SPWR *(SunPower) in the solar sector.


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## peter2

@ducati916  Thanks for introducing me to the Fly blog. I'm totally entertained by it. Plus it's a good guide to current sentiment in many sectors. The man can trade. I had this silly notion of trying to match him with my meagre US account. He lost in Jan so I was ahead going into Feb. I gained more in Feb but the Fly crushed it by turning a -7% into +9% by the end of Feb. Already in early March he's +18% for CY22. 
He's a maniacal trading machine but fun to read.


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## peter2

Whoa, something just happened. US equity market are rallying strongly knocking me out of my *TQQQ* short for a loss. Meanwhile the VIX short is profiting. It's a wash at the moment and I need the VIX to keep falling today and tomorrow.

Gold fell $30 currently (@explod has fallen out of bed). Oil fell $4. Something's afoot, Sherlock.

Markets are pausing and reversing the latest move.  Oh, It's all happening here. ILTB.

Edit: and *TAN*'s going to the moon. Already up +2R and I can't sell, as it would be classed as another day trade which will trigger the PDT rule. I'm forced to be patient with this one now. I can't watch.


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## explod

peter2 said:


> Whoa, something just happened. US equity market are rallying strongly knocking me out of my *TQQQ* short for a loss. Meanwhile the VIX short is profiting. It's a wash at the moment and I need the VIX to keep falling today and tomorrow.
> 
> Gold fell $30 currently (@explod has fallen out of bed). Oil fell $4. Something's afoot, Sherlock.
> 
> Markets are pausing and reversing the latest move.  Oh, It's all happening here. ILTB.
> 
> Edit: and *TAN*'s going to the moon. Already up +2R and I can't sell, as it would be classed as another day trade which will trigger the PDT rule. I'm forced to be patient with this one now. I can't watch.



Yep, but afraid the DOW crashed in the end and gold back up again and about to eat the all time high.


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## qldfrog

explod said:


> Yep, but afraid the DOW crashed in the end and gold back up again and about to eat the all time high.



Basically at the end facts always beat narrative, be it today or in a month.
Pretty simple one way road for a while in my uninformed opinion.
But Peter's "systems" can run this no doubt👍


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## peter2

Noting it here that I'll start one or more swing trades in US uranium stocks. My first choice is *URA* (ETF) and I'll look for current producers (*CCJ*). Others, *URG*, *UEC* are off an running along with the uranium stocks on the ASX.

Reason: Russia produces 40% of worlds enriched uranium that runs nuclear reactors. If this supply gets "sanctioned" then the POU will rocket.


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## qldfrog

peter2 said:


> Noting it here that I'll start one or more swing trades in US uranium stocks. My first choice is *URA* (ETF) and I'll look for current producers (*CCJ*). Others, *URG*, *UEC* are off an running along with the uranium stocks on the ASX.
> 
> Reason: Russia produces 40% of worlds enriched uranium that runs nuclear reactors. If this supply gets "sanctioned" then the POU will rocket.



Agree, have a small bet on US market uranium
Sanctions could also come from Russia and there are maybe some resources that could see price jump there..going straight to China, bypassing the west


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## peter2

*Update*:  I got caught in the "VIX" issue this week. Barclays the administrator of the *VXX* ETN ceased sales in two of their ETNs (*OIL VXX*) due to their recent increase in volatility. This caused the prices to spike higher than their implied value, due to the uncertainty. I noticed the problem a few days ago as *VXX* was trading stronger than it should have when compared to *UVXY*. Then a day later *VXX* traded up twice that of the 2x leveraged *UVXY*. (WTF?).  My US broker closed trading on VXX, only allowing open trades to be closed. I decided to swallow the -2.6R loss in case it got bigger.




Huge dip in all commodities will setup next swing higher. Keep an eye on them.


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