Market Close April 30th, 2020

Look at us getting the date right today for a change. Sorry about that. I shall endeavour to not let that happen again.

According to my charting software the U.S, markets have just had the best month since 1987. If you have been following what we are doing here with our simple trading system, you can see how useless that information is to us. And why you should not be paying attention to it. All it does is affect your decision making. If I said to you we have a signal that says we should short the market, could you do it? Many of you could not.

Let’s start there…

S&P 500:

This index is showing in a downtrend by our definition. The 21 EMA (blue) is below the 55 EMA (brown). The price has shown some strength today, but not enough to give us a trade.

Bitcoin:

Still in a downtrend as the 21 EMA (blue) is below the 55 EMA (brown). Like the S&P, Bitcoin has shown some strength today.

Gold:

Continues to display uptrend, but just refuses to take a run at resistance. Today the price of gold dropped about $40. So our UGL trade remains ready, vaulting pole in hand for the rise that will put it over the top. UGL, of course, is our stock market proxy. We will keep the trade on the books for now.

Oil:

What is there to say about oil. The downtrend is still strong with this one. The price however has decided it likes the $8 dollar level and has taken up residence there for several days.

As an aside, I do have a bullish set up in a different technical tool, but it is a long way from a trigger. We won’t be using it on this portfolio.

USD/EUR:

This currency pair took a beating today. The price crossed below the 55 EMA. The trend, however, is still showing up – the question is for how long. I did fear for our stock market proxy, EUO, but you will be relieved to hear that our trade is hanging on by the skin of its teeth.

Apple:

As mentioned yesterday, a pending trade was in order and all we needed was a move to trigger it. To the chart, Robin…

APPLE

The price closed today at $293.80. Our stop-buy was set at $292, which was just above the most recent resistance.

Based on our rules, the trade looks like this:

120,000 portfolio (roughly) X 10% = $12,000 / $292 = 41.09 shares rounded to 40.

The trailing stop would be placed at $264 (just under recent support) which is $28 of risk per share X 40 = $1120 of total risk which is under the 2% risk level we allow ourselves ($120, 000 X 2% = $2400).

As mentioned, if Apple moves up, so will the stop. Details as they unfold.

If you have any questions or comments, please drop me a line at: charlesgoddard2020@gmail.com

TTFN,

Charles

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