What’s going on with everyone?
I don’t know about you, but standing between buying and returning gifts this Christmas season has left me a little irritated.
(Full disclosure: I’m not the “queen of everything” as the coffee cup says)
In my mind, a good portion of the frustration of transacting at a brick and mortar store should now be avoided.
After all, it’s almost 2023!
You might think that new tools and methods will replace retail cashiers Incompetent Procedures they still use.
I bring this up because I have been in contact with my members Terminator Trading chat room recently in an attempt to find out what their New Year’s resolutions are when it comes to trading.
Do you know what one of their key resolutions is?
Become a more efficient trader.
Look, I understand.
There is a huge universe of thousands of stocks and ETFs to choose from.
So, by inefficiency, I say these traders prefer to spend very little time looking for ideas with the greatest potential to move “quickly”.
Now, notice that I didn’t say move “big.”
This is because successful traders look for trades where the risk is well defined and manageable and the probability of a successful trade, not a blowout trade, is high.
And still goes on to be a successful options trader.
To be a successful options buyer, you also need to know how to find options that are poised to appreciate faster than theta (the time decay of options prices).
That’s why I tell my members to use tools that are useful in finding not only sector cycles, but big “smart money” flows!
Friends, here’s how it all comes together.
When I do top-down analysis, one of the many tools I use to detect sector rotation is the relative rotation graph (RRG).
Relative rotation graphs are readily available on many charting sites these days. Today, we will use the version provided on Stockcharts.com website.
Stockcharts.com describes RRG charts as follows: RRG® charts show you relative strength and momentum for a group of stocks. Stocks with strong relative strength and momentum appear in the green leading quadrant. As the relative momentum fades, they typically move into the yellow weakening region. If the relative strength then fades, they move into the red backward region. Finally, as momentum begins to pick up again, they shift into the blue enhancing region.
Benchmarks are compared to some benchmark, in most cases the S&P 500.
When applied to the Dow Jones Retail Index, this analysis produces something like this:
Although not visible on the top cycle chart, the S&P 500 ETF (SPY) is positioned in appearance (where the X and Y axis meet in the green circle), while any sectors analyzed are leading, weak, lagging. Or improving relative to the S&P 500.
So what this chart tells me is that after lagging so much relative to the S&P 500, the retail sector ETF is starting to make a U-turn and may soon move into the improving quadrant against the S&P 500.
With that information, I decided to keep a close eye on stocks with unusually large options trades in the retail sector.
I take the next step in my process by bringing you the set of tools you want No Find out as part of any basic charting site.
Guys, my premium and customizable Unusual options function And Dark pool The scanner is at the core of my trading and is the reason I teach so many amazing retail traders as part of my business. Terminator Trading Service.
FTCH is a luxury retailer, I’ve been noticing lately, waiting for the right conditions to come together for a great business idea.
When I saw the $4 calls piled up with expiration on Tuesday 01/06/2023, I didn’t hesitate to let my Terminator Trades members know about my plan.
I quickly sent this instant alert to my audience through the RagingBull app…
After that app warning, sometime later, FTCH Breaking through that key resistance, it rose to an intra-hour high of $4.33…
Now, you know, I’m all about options, and that’s where the story gets juicy…
Because those $4 calls are high on FTCH DoubledA 109% move in less than 3 hours!
That’s what you call efficient trading my friends!
If you buy options and are sick of watching the underlying stocks move while you wait for them to move, we have a special treat for you.
At the end of this year, my friend Jeff Bishop, CEO of Ragingbull, offered to give me the go-ahead. Unbelievable discounts 57% and 50% Terminator trading programs Currently (Currently there are only 2 options TERMINATOR MAX Closed and only available ELITE members)
There’s never been a better time to learn from me first-hand than during this year-end “blowout” sale.
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