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Old 05-16-2009, 06:57 PM   Nav to Top  #1
psgama
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Arrow Bullish Financial ETF?

Well, I've been working on another chart and figuring out how to use the features of the forums a bit better and I think I've found a nice little leveraged ETF for swing trading. Proshares Ultra Financials UYG.

Top 10 holdings ending friday are here
Proshares Holdings

I imagine with the announcement I read today that Mr. Buffet has increased his shares in Wells Fargo by 4.3% in the first quarter, this ETF should be affected by copycat investors.

It looks slightly to me and I'm in for 600 Shares at 3.91 planning to sell the swing at 5.00 and repurchase again at around 3.90 again, hopefully. I was a little early on this trade I think, it tapped its bottom at 3.60 this cycle.

Once again, Any input would be appreciated.
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File Type: png uyghourly.PNG (77.7 KB, 4 views)

Last edited by psgama; 05-17-2009 at 02:52 PM.. Reason: Added Hourly Chart
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Old 05-16-2009, 07:06 PM   Nav to Top  #2
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Looks good to me.
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Old 05-17-2009, 10:35 AM   Nav to Top  #3
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psgama - you're right to trade bounces on a channel, just be aware if that channel breaks (you are looking for a daily close below the channel line to confirm a break) then you need to cut out at a loss.
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Old 05-17-2009, 11:16 AM   Nav to Top  #4
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I like your chart and channel, and UYG has a better upside than FAS which is similar but leveraging a different index (^RIFIN).

The only thing I would add is that the ^DJUSFN seems to be forming a rounded top and that banks have been pumping for 6 weeks.
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Old 05-17-2009, 02:09 PM   Nav to Top  #5
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This video might be of interest if you are thinking of trading financial ETFs. It relates to FAZ (Financial Bear)/FAS (Financial bull) but they all move in the same direction so SKF/UYG will be similar


Good luck
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I'm using a stoploss at my break-even on SFEG. Production is delayed.
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Old 05-17-2009, 02:28 PM   Nav to Top  #6
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BTW - see the channel you drew on the UYG chart? the price broke out of the channel upwards - that is never a good sign IMO as its not sustainable. The breakout above a channel then back inside and straight to the bottom is actually quite bearish.

At the bottom of the channel UYG is also forming a "Low base" - several consecutive days resting on support. The longer the ETF rests on that support and is not pushed up fast then the weaker the support is.

Be careful mate

To go long at support is always a good trade, but so long as you cut your loss (stoploss?) below the channel if it breaks down decisively.

Edit

Sorry not meaning to spook you - I realise I posted three -ish posts on this thread!! I could be totally wrong, but I don't feel confidently bullish about the markets at the moment.
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Old 05-17-2009, 02:54 PM   Nav to Top  #7
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So on a channel break on the downside swing, what kind of percentage below the trendline would you confirm at? I have my stop-loss set at 3.50, significantly lower than my buy in, since I jumped the gun on the buy button, lol. Would you recommend switching into a leveraged bearish fund such as FAZ at this point?

I've added the UYG hourly chart of mine to my original post still using the trendlines drawn with the daily closings, and I can see the double top that marked the downward 5 day decline.

Now, provided we close higher than opening tomorrow, i can see a double bottom signal on the lower trendline, this should mark a bullish reversal, shouldn't it?
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Old 05-19-2009, 05:43 AM   Nav to Top  #8
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Hi psgama,

What you ought to do is close out a position only on a daily close below the trendline, since you are trading on a daily scale. Intraday prices can spike below a line then shoot up above it. On a daily basis if it breaks below then this is the signal to get out.

Anyway it seems you timed this entry well as the market has magically turned bullish! Depending on how much UYG moved up now is the time to start managing risk by trailing the stoploss up.

If you see it reach the top of the channel then its a good point to take profits.

Good luck
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Old 05-28-2009, 06:47 PM   Nav to Top  #9
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Hi mate, you still holding this ETF? Look what I found today



Its a bullish pennant!

See also the charts over at the Broader Markets S&P thread in "Trend Spotting"
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Old 05-28-2009, 06:55 PM   Nav to Top  #10
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I've been keeping an eye on it but I sold my position in UYG for the time being, It was moving sideways for too long without any run ups over 10% which was what I was looking for to take profits plus the Canadian dollar is getting too strong relative to the American dollar and I hate loosing money on sells due to the exchange rate.

Moved my money into AZD and ELR for the time being and I'm pretty happy with the near 40% Gain on AZD thus far

Once the CDN Dollar looses momentum or is at par with the USD I'll be moving back into some American Securities.

Thanks for the heads up though :) And Good luck with UYG if you're holding a position!
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