Weekly Round UP to June 5th, 2020

Once more unto the breach dear friends…

Yes, it is once again that time of the week you have been anxiously awaiting: The Weekly Round Up !

Let’s get started. We have four open positions – unheard of!

The underlying instrument is accompanied by the ETF (exchange traded fund) that represents that instrument in the stock market.

S&P 500: UP = SSO, DOWN = SDS

SSO

We opened the position at $114.74 with a trailing stop set $16.04 below the trade price. Just below support at the time at position 2.

The latest high of $135.40 means that the trailing stop which followed the price up is now anchored at $119.36. This means that if the price collapsed totally, we would be stopped out at $119.36, and yes that is above our purchase price, meaning we are now in that glorious position of being risk -free.

We are now in a position that if there is a little push back without stopping us out, but the trend continues up, we could add another position if our process allows.

One little cloud, though, the horizontal line at 1 shows that the latest high in price is not matched by a high in the ROC. If the price CLOSES below the diagonal trend line, we would bring our stop to just below the low of the candle that did the closing.

We have been warned by the leading indicator, the ROC, that this rise may have some weakness inherent. A divergence does not always appear, but when it does, we have to pay attention.

Gold: UP = UGL, DOWN = GLL

GLL

The chart of GLL above has a horizontal resistance line. We needed a close above that to enact a stop-buy. We did get that close and placed a stop-buy at $40.47. The next day, however the price dropped. Then on the 5th, we got s rise at position 1 that triggered us into our position. It looks like this:

$13,000(10% of the portfolio)/ $40.47 = 321.225, rounded to 300 shares.

The stop is put just under support at position 2, $36.93

$40.47 – $36.93 = $4.23 X 300 shares = $1,269 risk (<$2,500 = approx. 2% of the portfolio)

Key elements of this trade were waiting for a CLOSE above resistance and then waiting for the next price just above that.

Oil: UCO = UP, SCO = DOWN

UCO

This chart is a little difficult to deal with because of the scaling after the big drop. I double check the price on other sites. We are essentially waiting for UCO to close above the resistance zone. The upper horizontal line is at $ 32.96. The high on June 5th was $30.29. We have a little work to do.

Dollar Index: UP = UUP, DOWN = UDN

This is the US dollar versus a weighted basket of global currencies. Up means the US dollar is stronger than the basket, down means the opposite.

UDN

We have an open position in UDN. You can see where we placed our buy – just above the resistance line at $20.00. We bought just above the close just above that line at $20.09.

The trailing stop was set just below support at .37 below the trade price. The most recent high was $20.42. This means we are within 4 cents of being risk free on this one as well.

20 year treasuries: UP = UBT, DOWN = TBT

TBT

TBT is currently an open position. Once again you can see the close above resistance and then the rise above that triggering us in. The high on June 5th was $18.29. Our stop was originally set at $2.01 under the trade price – just under support.

Our purchase price was $17.09. This means $18.29 – $2.01 = $16.28 (this is the new stop as anchored by the trailing stop). We still need a rise of another 81 cents to make this trade risk free.

This exercise is a continuation of the theoretical trading started in my book: Basic Trading: ‘A Beginner’s Guide to Trading and Investing…PROFITABLY!’.

You can get this book by going to: https://abeginnersguidetotradingandinvesting.gr8.com/offer_page.html

If you go and scroll down, even if you don’t buy the book – which you should do – you can grab yourselves a couple of excellent books for….FREE!

If you have any questions or comments, please direct them to: charlesgoddard2020@gmail.com

TTFN,

Charles

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