Technical Analysis. Nasdaq 100, |
||||||
|
Highlight Investments Group |
|||||
|
||||||
|
||||||
 |
|
|
||||||||||||||||
|
|
|||||||||||||||||
S&P 500 May 31, 2002
One of our most conservative long-term traders has made some very profitable trades over the past month. Based on our advice and analysis he was able to make over $10,000 in the last month!
| Security | Return |
| SPX Call (July) | 56% |
| SPX Put (July) | Holding |
|
Total Earnings: |
$10,900 |
The market has been fairly volatile in the past few months, leading to up & down-trends which don't last as long as they do in traditional market conditions. Generally, in the past, when the market confirms a up or down-trend, this trend would continue for at least a month. Recently up and down-trends have only lasted a few weeks at best. This has forced even conservative long-term players to consider making shorter-than-usual long-term trades. This can be seen in the Chart of the Week archive, where and long-term trades made by our conservative long-term player have lasted a duration of weeks instead of months. Unusual market conditions have contributed to this, and investors must adapt to changing constantly conditions in order to keep up.
On May 7th, MarketVolume's Market Commentary confirmed that the market was in the lower levels of it's support corridor. Based on this news, and high volume levels on the downside of the S&P 500 index, our conservative long-term trader decided to play up by buying S&P 500 call options for the month of July. He decided to keep these call options open until MarketVolume confirmed that the S&P 500 index was approaching a resistance level. This resistance level was confirmed when there was a great deal of volume to the S&P 500 index's upside. Our conservative long-term player didn't want to take any chances on loosing out; therefore, he waited until a downtrend was confirmed in MarketVolume's market summary and by a large peak in volume on May 16th. Upon this confirmation he closed his call positions, and opened a new put position and is still holding this position open until a support level is confirmed.
The same principles mentioned above works for trading NASDAQ 100, S&P 100, Dow Jones, and other indexes.
We would like to make it clear to our members what the motivation for our professional trader was to make the above trades; therefore, we have created what we call a 'Table of Motivations', 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 Call 1 | Purchased SPX call options mostly due to visual confirmation of a support level cause by the accumulation of a great deal of volume to the downside. MarketVolume's Market Commentary was also taken into consideration as it stated that the market is in a support corridor. | Volume over the past few days for the NASDAQ 100 and S&P 500 indexes has remained at unprecedented levels (60-day chart using a 1-day VMA), in other words, volume has been critical. Our analysis still concludes that the NASDAQ 100 and S&P 500 are in the lower levels of their support corridor. |
| Sell Call 1 | Sold all open call positions due to an unprecedented amount of volume to the upside of the S&P 500 index. This volume signaled a high level of resistance, thereby confirming the end of the market's up-trend. MarketVolume's Market Commentary also noted that the market has begun a down-trend. | The market declined today and there was not an appreciable amount of volume in either direction, leading us to believe that the the market will begin a down-trend. |
|
Buy Put 2 Holding |
Due to the confirmation of a new down-trend for the S&P 500 index, found that a good conservative move would be to purchased July put options and to hold them until MarketVolume confirms the end of the down-trend in it's Market Commentary. |
Based on MarketVolume's analysis, our professional investor was able to make the following returns:
| Security | Return |
| SPX Call (July) | 56% |
| SPX Put (July) | Holding |
|
Total Earnings: |
$10,900 |
Here is a detailed list of our investor's trades, which netted the above returns:
| Date |
Put/ Call |
Ctrcts |
Contract Price |
Index Value |
Strike |
VMA (1-day) |
Amount | Profit |
| 5/5/02 | B C1 | 10 | $19.45 | 1,056.30 | 1,110 | 3,072,700 | $19,450 | |
| 5/21/02 | S C1 | 10 | $30.35 | 1,094.60 | 1,110 | 2,239,100 | $30,350 | +$10,900 |
| 5/21/02 | B P2 | 20 | $16.10 | 1,094.80 | 1,055 | 2,239,100 | $32,200 | Holding |
|
Total: |
+$10,900 | |||||||
To see any of our past best trades, simply select from the list below.
|
|
QQQQ Trading System QQQQ, SPY and DIA trading signals for conservative mid- and long-7 term traders ...
|
NASDAQ Polling Service Visit Sites:
Options Trading
Stock Market Sentiment
Financial Glossary
Stock Market
| RISK STATEMENT: The trading of stocks, futures, commodities, index futures or any other securities has potential rewards, and it also has potential risks involved. Trading may not be suitable for all users of this Website. Analyst research available through this Website does not constitute a recommendation or a solicitation any particular investor should purchase or sell any particular securities. Past performance is not necessarily an indication of future performance. You absolutely must make your own decisions before acting on any information obtained from this Website. |
|
Products ||| Advertise with us
||| Site Map
Disclaimer |
Privacy
|