9/28 – ETF Trading – FXI, EWW, USO, UCO, XLU, UPW

Good morning. Friday’s stock trading action gave us just a few opportunities to scale into our etf trades. Here’s where you should be:

You should be long in the first position for any of the following etfs that I listed last Thursday (9/24).

FXI, EWW – Country ETFs: These moved higher on Friday, but not enough to trigger our exit signals. We’ll patiently wait for the market to make a move. (The highlighted bar in the charts shows today’s etf trading action.)

USO, UCO – Commodity ETFs: A bit of divergence here with USO moving a bit higher and UCO moving a bit lower. Per our rules, that means holding steady on USO and buying an additional position on UCO. However, in my own opinion, when there is divergence between an index etf and a leveraged copy of the index etf, I would follow the signals from the index etf – USO in this example. So, since USO moved higher on Friday, we’re invested only in the intial positions we took for USO and UCO on Thursday.

XLU, UPW – Sector ETFs: These moved lower on Friday. You should have added a second trading position in these etfs.

Our etf trading strategy is to buy additional positions should any of these etfs move lower than our initial entry price. Otherwise, our exit signals are a closing price greater than MA(5) or the RSI(2)>70. It’s your call on which exit signal to use.

All of these trades are based on the strategies found in the book by Larry Connors: High Probability ETF Trading. All trades are at the market close.

Join me every day as I offer new etf trading strategies for you to follow.

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