New SPXU Trade

Click on Chart to Enlarge

The chart above shows SPXU over the last 8 days or so. SPXU is a newer 3x ETF mirroring the S&P 500. It has caught on in popularity and has good volume. For any potential 3x trades I will probably use this from now on to try to avoid some of the problems with my analysis being on the S&P 500, but trading BGZ which is based on the Russell 2000. The slight differences in performance make placement of stops, etc more tricky.

The chart is showing a possible head and shoulders bottom developing (a H&S top in the S&P 500) on a short term basis. Now it would be safest to wait for the neck line to be exceeded, but that will significantly diminish the reward to risk ratio. So I am going to post a trade on it with an entry at current levels. There are mre than enough factors to justify this in my opinion. So ideally the market will fall over the next couple days and we can move a stop to breakeven quickly with possibly a MAJOR market move on the horizon. If not we will probably be stopped out. So make sure that your risk is sensible. If you have any questions use this post to decide how much to risk on the trade. Use the "Trades with a Stop Loss" section.


New SPXU trade:

Buy SPXU today with a market order. Place a GTC sell stop at 52.15 immediately after entry. Blog entry price is the current price of 53.40.


For any smaller accounts that would be following the cumulative method of money management and still holding SDS, just continue to hold and forget this trade. I will either post an exit on that at the next oversold signal, or start to trail a stop if the market appears to be making a major top.