EOM Q&A Trading Tips 5.20.16

From last night…
 
Earlier today I was planning on buying one third of a (trading) position with SDS….what (signal) kept me from hitting
the BUY button? 
 
Trading Leveraged or Inverse Funds is like catching lightning in a bottle.  
These securities are designed for trading vehicles only.  
When trading, a fine-tuned entry point strategy is imperative.
 
I want to thank all who submitted an answer.  The winner was Mark Krones.  
Why-many cited the CMF…Mark had the best explanation to why.
Why I wanted to buy….
1.   SPX was trading below S-support 1240
2.   VIX was trading above the 6 SMA
3.   Price was trading above the short-term (see chart)
4.   Green bars
5.   The MACD Histogram, RSI and Slow Stochastics were all in Buy Territory.
 
WHY I DID NOT buy SDS yesterday…
 
1. I must see three increasing Green CMF bars before buying.  See August 2015 and January 2016.
 
Procedure…
If 10% of my Account Asset Allocation is for trading, then I only use 30% of that 10% for trading each security.  
When buying, I buy incrementally. I  buy a half-position and then another half…. IF....the trade continues in my favor. 
 
Earlier this week I discussed to keep things simple. Before trading, research the previous runs.  See which indicators gave the best signals.  Then Wash-Rinse-Repeat.
 
I studied a few thousand charts to determine which indicators to use in my Simple Simon Systems.  
You paid for this knowledge…use it!
 
An Important point.  
When students ask what to do with their losing trade, over 90% of the time they DID NOT use the Simple Simon System 100%.  
Change the recipe and see what happens!  
You would not dare change Grandma’s Dressing or favorite pie Recipe-why change the Simple Simon?
 
Feedback from a new subscriber…I appreciate the valued feedback.
The signal I noticed in this late mornings charts was the trend line break in $VIX.   It also got me out of a trade I was in.  (And that was good, I got out a close to the high of the day.  So a big Thank You to your teaching!
Switching Gears….
 
Here is my SPXU chart to finalize the week.  What do you see?
 
I may wait and do my Market Recap in the AM-we will see!
 
Enjoy the day!
 
DOE
When your Vision and Goals are Clear-Results will Appear!
This information is for Educational purposes only.
It shall in no event be construed or interpreted as an offer or recommendation to buy or sell securities of any kind.
 

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