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Bull Run nearing the end? Hedge with Bear ETFsAfter nearly a decade of growth in the stock market, many believe the "bubble" will soon pop. With trade wars between the US and China looming in the shadows, we may be seeing a reversal in the near future. This stock, FAZ, is a 3X inverse ETF of the financial index. At the height of the 2008 crisis, this stock hit highs of over $100,000 per share. As the market recovered, and the bulls gained momentum, FAZ steadily declined as it should. Now that we are looking at the possibility of a macro trend reversal, the wise choice would be to diversify into hedges that will protect your portfolio in the case of a collapse. The potential upside here is magnanimous. If we wait until the actual reversal takes place, the highest percentage gains will be already booked. It's highly unlikely that we will see significant loses in this ETF, given that we have reached an apparent bottom. The activity that i've seen, including the double-bottom bounce, leads me to believe that upside action in the near future is imminent. At only $11.13 per share, a small investment could create very impressive potential returns.
AMEX:FAZLong
by dcattey
1
Trade setup for hedging against a bearish indexThis setup is to work as a hedge against the possibility of a long-term bearish trend in the tech index. Recent price action has indicated that a possible trend change is about to happen. This is the beginning of a potential trade setup which can act not as a money-maker, but as a protection for money that is currently in the market and at risk of becoming lost investments. By placing a slight risk in this trade, it can help give some insurance for the possibility of stocks taking a bearish term for the near term and distant future.
NASDAQ:SQQQLong
by Yqztv09
S&P 500: Hedging against bear market riskThe "S&P 500" started on Wednesday to fill the open gap between March 8 and March 9 (above 2740, below 2751). This is bullish and should lead to a bounce in the next days, thereby taking the "S&P 500" higher again. But in case this bounce fails to keep the market going upwards above 2800, the idea is to hedge against further downside risk with a short placed above the high of March 14, at least while the long from 2651 remains open (see related chart idea below). Short entry: 2785 Stop loss: 2833 Target: 2640 Risk/Reward: 3 The Directional Movement Index (DMI) indicator shows that the downtrend was almost over after March 12, but then instead resumed on March 13 on the "S&P 500". The Directional Movement Index (DMI) indicator didn't cross bullish on the "Dow Jones", a signal which is even more bearish than on the "S&P 500".
SP:SPXShort
by ChartArt
S&P 500: Stormy Daniels days aheadShort-term trend remains bearish despite the recent bounce. "S&P 500" futures ahead of the Wednesday cash open are pointing lower after Trump stepped up trade threats as White House economic advisor Gary Cohn resigns in protest. This increases the risk of volatility, which could cause another decline of the market. Short Entry: 2715 Stop loss: 2772 Target: 2600 Risk/Reward 2 This short functions to hedge the long position from 2651 (see related chart below), which remains open until the stop loss at 2663 gets taken out.
SP:SPXShort
by ChartArt
9
Silver Accumulation Phase - Wyckoff Analysis - 3D TF - $XAGWyckoff analysis for $silver $xag 5 years of selling between 2011 and 2016 led to a Selling Climax (bottom). An Automatic Rally followed, which set the ceiling for the accumulation range, i.e., between $18.5 and $21. Ongoing, very long Accumulation Phase, to date. Wyckoff fundamentals suggest the longer the accumulation phase, the longer the rally. A Secondary Test appeared during Accumulation. Spring will kickoff breakout and rally. Rapid hedging for the next recession may serve as a catalyst for the upcoming silver rally. Open interest for silver has started to appear, as of October 2017. Accumulate now.
TVC:SILVER
by MoonPickle
4
SIF: Example of how hedge-funds operateThe strategy described on the chart is simple. First i'll take a long position to target the last high. From that point i'll take a short position which is exactly the same size as my long position. This means that from that point it doesn't matter what the market will do next, because I have my profit locked between these 2 points. I would preferably see price to then break the last high, so i could add another buy above it. If price gets back to the entry point of my short position, I simply close the extra long, and will not have any negative effect on my profit. The advantage of hedging your position is that: 1. You'll have no risk from that point, if done correctly. 2. You could add positions if the market continues to surge and make extra profit. 3. No one knows what the market is going to do, it's always a process of probability. So if the price does go up to the last high, and then crashes down, I'm still risk free and could even add more short positions to it. You could also hedge by going long in one stock, and short another stock which is correlated to the one you went long. You then expect one stock to do better than the other.
EURONEXT:SIFG
by chrisvos
XLK - Feb.'18 Exp. Put Vertical Debit Spread (Hedge)Trade details: 66/61 Put Vertical Credit Spread @ $1.82 Prob. of Max Profit = 4.90% Prob. of Max Loss = 29.12% Break-even @ $64.18 51 D.T.E. Trade plan: Straight up hedge against technology sector/semiconductor industry (NVDA + AMAT long put credit spread positions - both are linked below). Feb.'18 expiration chosen to focus on Feb.'18 earnings reports for both NVDA and AMAT in case of strong downward plunge in technology sector. Trade approaches 50/50 play from this point on since break-even price is the same as close price for the day. Expecting spread to expire worthless if price falls between break-even & $61.00 by expiration, but will take early profit (and re-establish position if necessary) if there is an early move to ~$62.85 level.
AMEX:XLKShort
by AtoHoward
BAD STOCK, POOR MARKET CONDITIONS, BUT OTHERWISE A GREAT COMPANYNewmont Mining, “Newmont”, is one of the world’s largest gold mining company by Market Capitalization with operations in the United States, Australia, Peru, Ghana and Suriname. On average, over the past 7 years, the company has contributed to 3.58% of the world’s supply of gold (based on World Gold Council figures). Compared to its strongest competition, Barrick Gold, its operational mines are located in politically stable geographical zones. In an industry where government intervention and scrutinity is part and parcel of normal business, an investor would most certaintly benefit from companies that has less exposure to such erratic regulations. Newmont’s share price is highly correlated to gold price, which should be of no surprise as its bulk of profit is derived from gold mining. Gold, for a good part of modern history, has served as a hedge against inflation and would probably continue to do so. It has also become an asset investors flock to in times of uncertainty. While it is great that we are getting news almost every day about indices making new highs, investors should not be complacent and assume this would continue forever. Firstly, the Chinese financial industry is undergoing a deleveraging process. In an article by CNBC, according to the Institute of International Finance in June 2016, China’s debt-to-GDP ratio stands at 327 percent. If we recall, just about a decade ago, overleveraging was the cause of the great recession, causing the economy to plunge into freefall. Gold prices rallied from the low of US$781 per ounce at the start of the crisis in September 2007 to an all-time high of US$1878 in August 2011. To put it simply, no one had a clue about where we would move on from there, and their best bet in times of uncertainty would always trace back to Gold. As you are reading, China is still in the midst of their deleveraging process. Money supply growth has slowed tremendously while aggregate financing was RMB 70 billion lower than estimated, at RMB 1.04 trillion, according to a report by Bloomberg. With lesser money going around the economy, interest rates are set to rise. The Chinese 10-Year Bond Yield stands at 3.96% as of this writing, up from 2.66% about a year ago. As the interest rates rise, companies would find it increasingly difficult to meet their debt obligations as refinancing becomes more expensive while they are still drowned in excess capacity. Due to the significant amount of bureaucratic red tape around Chinese statistics, investors’ sentiment is should be best reflected in the market. The Shanghai Stock Exchange Composite Index (SHCOMP) is at 3,276, down about 5% from this year’s high of 3,447. While we have yet to see any event that could trigger a market-wide correction, it would not be right to assume a black swan event is not brewing somewhere. To continue reading the full article, please visit houtiantan.com
NYSE:NEMLong
by HouTianTan
Bad Stock, Poor Market Conditions, but otherwise a great companyNewmont Mining, “Newmont”, is one of the world’s largest gold mining company by Market Capitalization with operations in the United States, Australia, Peru, Ghana and Suriname. On average, over the past 7 years, the company has contributed to 3.58% of the world’s supply of gold (based on World Gold Council figures). Compared to its strongest competition, Barrick Gold, its operational mines are located in politically stable geographical zones. In an industry where government intervention and scrutinity is part and parcel of normal business, an investor would most certaintly benefit from companies that has less exposure to such erratic regulations. Newmont's share price is highly correlated to gold price, which should be of no surprise as its bulk of profit is derived from gold mining. Gold, for a good part of modern history, has served as a hedge against inflation and would probably continue to do so. It has also become an asset investors flock to in times of uncertainty. While it is great that we are getting news almost every day about indices making new highs, investors should not be complacent and assume this would continue forever. Firstly, the Chinese financial industry is undergoing a deleveraging process. In an article by CNBC, according to the Institute of International Finance in June 2016, China’s debt-to-GDP ratio stands at 327 percent. If we recall, just about a decade ago, overleveraging was the cause of the great recession, causing the economy to plunge into freefall. Gold prices rallied from the low of US$781 per ounce at the start of the crisis in September 2007 to an all-time high of US$1878 in August 2011. To put it simply, no one had a clue about where we would move on from there, and their best bet in times of uncertainty would always trace back to Gold. As you are reading, China is still in the midst of their deleveraging process. Money supply growth has slowed tremendously while aggregate financing was RMB 70 billion lower than estimated, at RMB 1.04 trillion, according to a report by Bloomberg. With lesser money going around the economy, interest rates are set to rise. The Chinese 10-Year Bond Yield stands at 3.96% as of this writing, up from 2.66% about a year ago. As the interest rates rise, companies would find it increasingly difficult to meet their debt obligations as refinancing becomes more expensive while they are still drowned in excess capacity. Due to the significant amount of bureaucratic red tape around Chinese statistics, investors’ sentiment is should be best reflected in the market. The Shanghai Stock Exchange Composite Index (SHCOMP) is at 3,276, down about 5% from this year’s high of 3,447. While we have yet to see any event that could trigger a market-wide correction, it would not be right to assume a black swan event is not brewing somewhere. To continue reading the full report, please visit houtiantan.com
NYSE:NEMLong
by HouTianTan
Possible Migration into Bitcoin Cash (BCH/BCC)After Bouncing off of the bottom Support of the Rising Channel, there is a good chance we will see a 3,000+ breakout occurring in the near term. Breakout Area Once the Dec. 28th Segwit2x hardfork is complete Mass migration into Bitcoin Cash could very well take place For it's Jan. 2nd 2018 hardfork... The channel is pointing upwards. The Buy Zone to get into BCH ( Bitcoin Cash ) is steadily rising, bouncing off of and testing bottom support of the still rising channel. MACD and RSI are both oversold breaking up with lots of room to move off these steadily rising support levels. So all systems (signs) are go from what I see as the volumes creep back into normal gear that could pump the price action more in the general upward trend this support channel is carrying us. $2,580 is the first Fib. 50% entrancement target into a heating Buying Opportunity. Then next is $3.035 for the 61.8 full breakout to start moving UP in the direction of new ATHs (All Time Highs). Research shows Bitcoin Cash (BCH) cost ONLY 0.1 - 2% of what it cost to send Bitcoin (core) (BTC). Bitcoin Cash is 100X a better "Medium of Exchange" than Bitcoin (core) and is still valued less than 1/5th. You do the math... Looks like lot's of upside there to me... ;) Basic economics for a crypto "currency" to succeed as a "medium of exchange" is that it must beat out the competition in cost, speed, reliability and security - with emphasis on COST. If noting else, I consider these good well-thought-out reasons to at least hedge Bitcoin Core ( BTC ) bets with Bitcoin Cash (BCH). Of course, "this is not financial advice". I'm just sharing my research, thoughts and ideas. Wishing you all Happy Holidays and All the very best wishes of luck in your trading ;)
Long
by Inspirar
6