Technical Analysis. Nasdaq 100, |
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S&P 500 July 10, 2002
This week our professional short-term trader was able to generate a great deal of profits with one simple trade!
| Security | Return |
|
Put (SPY Aug) |
+61.8% |
|
Total Profit: |
+$17,820 |
Even though all the above trades were very conservative, we still came out on top with a profit of $17,820
What is Volume to the upside and Volume to the
Downside?
Whenever we mention 'volume to the downside' or
'volume to the upside', we mean an elevated VMA (Volume Moving
Average) against the general direction of the index. We don't generally
consider the VMA to be significant unless it is noticeably above normal.
Volume to the downside means an elevated VMA that occurs as the index is
going down. Conversely, volume to the upside means an elevated VMA that
occurs as the index is going up.
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 Puts | Based on MarketVolume's Market Commentary, the market was still in a downtrend. That coupled with the fact that there was a large spike of volume as the S&P 500 index was going up. This all indicated that the market will go down. | Being that today was a short day, there was not much volume during the day, but there was quite a bit of volume at the end of the day for the S&P 500 and NASDAQ 100. The volume at the end of today could cause the market to test it's previous lows. |
| Sell Puts | Based the decision on MV's Market Commentary that the index may 'bounce', and felt that enough profit had been gained, and that since the volume was beginning to gradually increase that perhaps it was time to exit the market with a good profit. | Due to a moderate amount of volume to the downside on the S&P 500 and NASDAQ 100 indexes, we may expect the indexes to have a short-term bounce due to the fact that we have not seen much supportive volume for a while. But since the volume we saw today was not even near the amount of volume we need to see for the index to reverse it's current downtrend. |
The same principles mentioned above works for trading NASDAQ 100, 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 |
Index Value |
Strike | VMA | Amount | Profit |
| 7/8/02 | B P1 | 15 | $19.22 | 991.18 | 950 | 3,331,800 | $28,830 | |
| 7/10/02 | S P1 | 15 | $31.10 | 953.73 | 950 | 3,017,300 | $46,650 | $17,820 |
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Total: |
+$20,405 | |||||||
To see any of our past best trades, simply select from the list below.
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QQQQ Trading System QQQQ, SPY and DIA trading signals for conservative mid- and long-7 term traders ...
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