The Round – Up is upon us. It is the time when we look at charts of all the symbols involved in our exercise as we wend our way to the expiry of 2020.
During the week the only entries to this blog are the actual trades as they take place and their details: position size, risk management, etc.
The portfolio currently sits at $142,917.10. This represents a gain of a little over 42% since January 1st, 2020. This is quite good. Especially since there is always a risk when doing this sort of thing live – so to speak – that you will end up with a lot of egg on your face.
I want to say once more that because the markets move in explosive spurts, we may still be sitting at this level at the end of 2020. We follow the process we set out and let the markets come to us. We don’t force anything.
Our short position in oil represented by SCO was stopped out earlier in the week leaving us with one open position: UDN.
Let’s start there…
Dollar Index: UUP = UP, UDN = DOWN
UDN rises as the U.S. Dollar weakens against a basket of global currencies.
We have had this trade for some time. Take a look at the resistance line at $20.48. The blue EMA (21) was above the green EMA (55) indicating by one of our definitions of trend that we have an uptrend. We trade with the trend, consequently we are looking for a trigger to the upside. That trigger is either the red EMA (8) or the price crossing above the blue EMA. The price crosses below the blue and then pops back up – our trigger. We have resistance at $20.48 preventing us from placing a trade immediately. We don’t want to enter a trade and then have it bounce off resistance. We wait for a CLOSE above the resistance level and enter a stop-buy just above that. This was at $20.67.
Our trailing stop was placed .51 under the trade price at support. Where, if broken, we are probably wrong and will be automatically taken out of the trade.
The trailing stop has followed the price up and when it created a high at $21.37, our stop was anchored at $20.86. Since we bought in at $20.67, even if the price totally collapses at this point, we are profitable and therefore risk free.
I have made an error with this trade. We should already be out of it. I will confess my sins tomorrow in full gory detail.
S&P 500: SSO = UP, SDS = DOWN
The SSO mimics the rise in the S&P 500. We were stopped out and the price by crossing the green EMA looks like it might be heading in the other direction.
This is when we look at the inverse of the SSO, the SDS to see if there is a trade for us there.
To the chart, Robin…
It is always interesting to compare the charts that represent the opposite or inverse of one another. Take a couple of minutes with them, I am going to grab a coffee.
The SDS rises as the S&P declines. We will keep an eye on both sides of this battle in the coming days. There maybe a trade in there for us at some point.
Gold: UGL = UP, GLL = DOWN
The markings of a recent trade have been left on the chart in case you find them useful.
For us to enter a new trade in UGL, we need our EMAs to do their work and a CLOSE above resistance at $77.07. The high of $83.85 represented overhead supply at one point. It has been dissipating with the sideways price movement.
There is much noise in the trading world that gold is going to the moon, Alice. Well, we are staying glued right here in the world of trades and actually wait for our process to tell us the moon beckons.
Oil: UCO = UP, SCO = DOWN
Not much to say here. We are looking at the long side of oil with this chart. We were stopped out of the short side earlier in the week at a small loss thanks to the trailing stop. You can scroll for details.
20 Year Treasuries: UBT = UP, TBT = DOWN
As you cast your eye on the right hand side of this chart you can see that the EMAs have bunched together – not social distancing at all. We are on the edge of our seats wondering which way the red EMA will go. The red will go first because it is the shortest and therefore most mimics the price itself.
We have a black horizontal line representing resistance and a red horizontal line doing the same for support.
Coming out of a bunching, EMAs generally get right down to work telling us what they think. For that reason I have shown the line that I need a CLOSE above to spring like a panther as is my wont into action.
If the red EMA (or price) crosses the red horizontal line, it would probably behoove us to take a look at the inverse of TBT.
That just about does it for this week.
I have an in-depth trading course launching soon. For an outline, please drop me a line at: firstname.lastname@example.org.
And, once again, for a deeper look at how we conjure the magic above, click here: