Art & Science of Active Trend Trading–Free Report Feb 21

Good Day Traders,

Overview & Highlights: Over the next several weeks I will be refreshing and re-recording the basic training videos for the Active Trend Trading System (ATTS). The intent is to provide a more straight forward training process that will help members learn the system more quickly. I’ll be posting updates as these videos come online.

Webinars: At Active Trend Trading we offer two webinars per week to provide training plus trade and market updates. See the schedule below for the next webinars.

How to Make Money Trading Stocks on Friday, Feb 26th

Register Here: https://attendee.gotowebinar.com/register/5170984866494198530

 

Next Training Webinar: Feb 23rd

For Premium Members our Wednesday evening training is developing some fantastic traders!

Mid-Week Market Sanity Check Topic: Reversion to the Mean—Finding the Highs & Lows


 

General Market Observation: The current relief rally continued last week as price action on each of the Tracking Indexes following through from the previous week’s bottoming action. Both the S&P and RUT provided confirmation to the weekly bullish reversal hammers and pushed up into resistance. Friday’s price action showed a battle between buyers and sellers most of the day and finished with the buyers winning the battle with each Index finishing near the top of their trading range.

As pointed out in the Daily Market Updates current market action looks similar to what we saw back in 2008. If this continues to play out then an increase in price back up to or above the 40 week moving average. The faster this move happens the higher the probability is that the next fall will be significant. If however price gains move gradually and orderly with small pullbacks to support levels price could move back to the 2000-2100 level or higher. If one is looking to trade the S&P index ETF look for a support around 1900. Trying to trade a breakout above 1925 but below the 50 day EMA would put price too close to resistance at the 50 and the 1950 level which is likely to rail.

Each of the other indexes are showing similar characteristics. Both the NDX and RUT are weaker than the S&P with the Russell being the weakest of the Tracking Indexes.

SPX 2-19

SPX: Downside Market Short the SPY, SPY Puts or SPXU.
Preferred Long ETF’s: SPY, UPRO and SPXL

NDX: Downside Market Short the QQQ, QQQ Puts or SQQQ.
Preferred Long ETF’s: QQQ and TQQQ

RUT: Downside Market Short the IWM, IWM Puts or TZA.
Preferred Long ETF’s: IWM and TNA


The How to Make Money Trading Stock Show—Free Webinar every Friday at 10 a.m. PDT. This weekly live and recorded webinar helped traders find great stocks and ETF’s to trade with excellent timing and helped them stay out of the market during times of weakness.

How to Make Money Trading Stocks on Friday, Feb 26th

Register Here: https://attendee.gotowebinar.com/register/5170984866494198530

 

To get notifications of the newly recorded and posted How to Make Money Trading Stocks every week subscribe at the Market Tech Talk Channel: https://www.youtube.com/channel/UCLK-GdCSCGTo5IN2hvuDP0w

The Active Trend Trader Referral Affiliate Program is ready. For more information or to become an Affiliate please register here: http://activetrendtrading.com/affiliates-sign-up-and-login/


Index Returns YTD 2016

I’ve added a column to the Index YTD performance chart. The column on the far right shows the depth of the current correction with respect to the highs of the top from 2015. Currently RUT is in Bear Market Territory.

Index YTD 2-19

 

ATTS Returns for 2016 through Feb 12, 2016

Percent invested $100K account: Strategies I & II invested at 0%; Strategy III invested at 20%.

Current Strategy Performance YTD (Closed Trades)

Strategy I: Down -407.85 or -0.58%
Strategy II: 1.65%
Strategy III: Up $2400 or +12%
Cumulative YTD: 2.4%

ATTS YTD 2-19

 


Active Trend Trading’s Yearly Objectives:

    • Yearly Return of 40%
    • 60% Winning Trades
  • Early Warning Alert Target Yearly Return = 15% or better

For a complete view of specific trades closed visit the website at: http://activetrendtrading.com/current-positions/

Updated first full week of each month.


 

For our all Active Trend Trading Members here’s how we utilize our trading capital

Trading Capital Setup and Position Sizing: Every year we start the year off trading a $100K margin account split up into the three strategies used with the Active Trend Trading System.

  • Each trader must define their own trading capital in order to properly size trade positions to meet their own risk tolerance level!

 

    • Strategy I: Capital Growth—70% of capital which equates to $140K at full margin. This strategy trades IBD Quality Growth Stocks and Index ETFs. Growth Target 40% per year.
    • Strategy II: Short Term Income or Cash Flow—10% of capital or $10K. This strategy focuses on trading options on stocks and ETF’s identified in Strategy I. The $10K will be divided into $2K units per trade.
    • Strategy III: Combination of Growth and Income—20% of capital or $20K. This strategy will use LEAPS options as a foundation to sell weekly option positions with the intent of covering cost of long LEAPS plus growth and income.
  • The $70K Strategy I portion of the trade account is split between up to 4 stocks and potentially a leveraged Index ETF. Actual number of shares will vary of course depending on price of the entity traded and amount of margin available. We have found that limiting open positions to only 5 entities greatly reduces the trade management time requirements for members.

 

  • Naked Puts or short term options strategies will be used occasionally for Income Generating Positions
  • None of the trade setups are recommendations to trade only notification of planned trades from set ups using the Active Trend Trading System. Each trader is responsible for establishing their own appropriate risk level if they decide to parallel trade.
  • The Active Trend Trading System objective is to provide a clear and simple system designed for members who work full time.

Outs & Ins: Five stocks made their debut on the IBD 50 this weekend. AYI, GG, NVDA, PCLN and SIX. AYI, PCLN & NVDA have been on the list in past years look to be attempting to either put in a bottom or breakout. NVDA looks to have the most promise to the upside and trades with good patterns.

12 IBD 50 stocks will report earnings over the next couple of weeks and then this earnings season will be complete. AVGO, ROST and DG are the biggest names that will be reporting between now and March 10th.

In-Out 2-21

Share Your Success: Many of you have sent me notes regarding the success you are having with the Active Trend Trading System. Please send your stories to me at dww@activetrendtrading.com or leave a post on the website. Thanks.

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