Technical Analysis. Nasdaq 100,


Technical Analysis - NASDAQ 100 & S&P 500

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Best Mid-Term Trade:
May 29th, 2002

Our analysis of volume over the past week has resulted in the following trades using QQQQ Options by our conservative mid-term trader.

Security Return
Put 1 (QQQQ July) +37%
Put 2 (QQQQ July) +57%
Put 3 (QQQQ July) +57%
Put 4 (QQQQ July) Holding

Total Earnings:

$20,405

Even though all the above trades were very conservative, we still came out on top with a profit of $20,405

Why didn't you buy any Calls?
Although there were some volume signals that pointed towards a short-term rally, we found that it was better to keep current put positions open since there was not yet enough volume to move the market much higher. Also, MarketVolume's Market Commentary signaled that the market would continue to decline.

Why buy Cheap July Puts?
Because July 'near-the-money' puts are very cheap, they would bring a much higher return if the market went down. In general, cheaper puts will bring a much higher return than more expensive puts. And we purchased July puts because if the market does not go down further right now, we don't need to worry about losing very much on the options.

We would like to make it clear to our members what the motivation was to make the above trades; therefore, we have created what we call a 'Table of Motivation', in which we try to make it clear the motivation that was behind each of the above trades.

Trade Motivation MV's Commentary on Members Home Page during the trade
Buy Put 1, 2, 3 & 4 Based on the large amount of volume which appeared as the NASDAQ 100 index moved up, coupled with MarketVolume's Market Commentary, lead to the decision to open a large position in July QQQQ puts. 1540 put contracts were opened. Since there has not been a lot of supporting volume as the S&P 500 and NASDAQ 100 indexes declined, we are led to conclude that this trend [downtrend] will continue until there is sufficient volume to boost the market.
Sell Put 1 The market was on a declining rather rapidly and volume was increasing. The volume which did occur was not high enough to change the directional trend of the market, but found that it would be a good idea to close some 1/4 of open put positions simply to be safe. Low volume on the downside, and moderate volume to the upside today suggests that the S&P 500 and NASDAQ 100 indexes will continue their current downtrend.
Sell Put 2 & 3 Closed another 2/3 of all open put positions due to a moderate amount of volume generated as the index declined. Felt that the best option was to take profits on 2/3 of open positions and leave 1/3 open for future gains. Another day of low volume for the S&P 500 and NASDAQ 100 indexes shows us that there is still little support for the market to change from it's current down-trend.

The same principles mentioned above works for trading S&P 500, S&P 100, Dow Jones, and other indexes.

Here is a detailed list of our investor's trades, which netted the above returns:

Date Put/
Call
Ctrcts Contract
Price
QQQQ
Value
Strike VMA Amount Profit
5/23/02 B P1 385 $0.35 $31.71 30 1,865,900 $13,475  
5/23/02 B P2 385 $0.35 $31.71 30 1,865,900 $13,475  
5/23/02 B P3 385 $0.35 $31.71 30 1,865,900 $13,475  
5/23/02 B P4 385 $0.35 $31.71 30 1,865,900 $13,475  
5/28/02 S P1 385 $0.48 $30.75 30 1,142.900 $18,480 $5,005
5/29/02 S P2 385 $0.55 $30.48 30 1,434,500 $21,175 $7,700
5/29/02 S P3 385 $0.55 $30.48 30 1,434,500 $21,175 $7,700

Total:

+$20,405

To see any of our past best trades, simply select from the list below.

Date Indicator
December 30, 2002 NASDAQ 100
December 19, 2002 S&P 500 (SPX)
December 10, 2002 NASDAQ 100
November 27, 2002 NASDAQ 100
November 20, 2002 NASDAQ 100 (NDX)
November 13, 2002 NASDAQ 100
November 6, 2002 S&P 500 (SPX)
November 1, 2002 NASDAQ 100
October 25, 2002 S&P 500 (SPX)
September 25, 2002 NASDAQ 100
September 18, 2002 S&P 500
September 6, 2002 S&P 500 (SPX)
August 21 2002 NASDAQ 100 (NDX)
August 14 2002 S&P 500 (SPX)
August 7, 2002 S&P 500 (SPX)
July 31, 2002 NASDAQ 100 (NDX)
July 24, 2002 NASDAQ 100 (NDX)
July 17, 2002 NASDAQ 100 (QQQQ)
July 10, 2002 S&P 500 (SPX)
June 26, 2002 NASDAQ 100 (QQQQ)
June 14, 2002 S&P 500
June 12, 2002 NASDAQ 100 (QQQQ)
June 5, 2002 S&P 500 (SPX)
May 31, 2002 S&P 500
May 29, 2002 NASDAQ 100 (QQQQ)
May 22, 2002 NASDAQ 100 (QQQQ)
May 17, 2002 S&P 500
May 15, 2002 NASDAQ 100 (QQQQ)
May 8, 2002 S&P 500 (SPX)
May 3, 2002 NASDAQ 100
May 1, 2002 NASDAQ 100 (QQQQ)
April 28, 2002 NASDAQ 100
April 22, 2002 NASDAQ 100
April 3, 2002 S&P 500
February 25, 2002 S&P 500
February 8, 2002 NASDAQ 100
January 30, 2002 NASDAQ 100
QQQQ Trading System
QQQQ, SPY and DIA trading signals for conservative mid- and long-7 term traders ...

QQQQ Signals
Past 6 Months

9%

17%

Compound Compound
Margin

As of 3/10/2010


NASDAQ Polling Service
Nasdaq in a month?

Up

The same as now

Down

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