“So says the market each & every time it moves!”
Today, I want to spend some time with the DOW30 CFD … we’ve come a long way
baby, in a very short time … it took a while, but finally the U.S. stock indices
markets are priced fairly by the offshore brokerage houses, to the point that
smaller accounts, and more importantly for me, the managed money accounts in
PAMM’s and/or MAM’s can trade them effectively … bid/offer spreads are mostly
reasonable around the world [sure, there are exceptions where you get ripped off],
round turn commissions, if any, are very tiny and immaterial to your success, and
the markets move … and oh boy, can they move.
Nothing gives you a better idea of how threatened the mighty CME thinks these
CFD’s via offshore brokerage houses are to their monopoly stranglehold on
indices futures, than their rollout of 🙶micro futures🙷, which are nothing more than
mini’s of the e-minis … they don’t like the fact that a major business component of
world trading goes to world banks that provide tight bid/offer quotes to the
offshore community … so yea, small account traders can now utilize U.S. futures
markets in the U.S. stock indices … but who cares? … IMHO, you’d have to be
nuts to trade these, simply for two very obvious reasons … 1] margins are much
higher than offshore [about 4X - 8X more, depending on the index], and 2] why
generate a 1099 for tax purposes if you don’t have to? … offshore brokerage
houses report NADA to any tax authority, leaving it up to traders in their specific
jurisdictions … that’s not my opinion, that’s a fact.
At present, the best of the 3 [between DOW30, SP500, & NDX100] in terms of
1] 🙶net cost🙷 to trade, AND 2] index point movement is the DOW30 … there are
other advantages as well, but these are the top two … since TURNKEY switched
liquidity providers, and went to their now 🙶Global Live🙷 network, I’ve had ZERO
problems with 1] slippage [minimal and to be expected], and 2] time latency
issues on fills … in other words, they’re much better than they used to be … not
the fastest fills on the planet, but in an acceptable range so that I know the
scumbag LP bank is NOT 🙶sandbagging🙷 my order in a que to screw me.
The major U.S. indices present a dynamic that other world indices don’t … and
that is they are 🙶80/10/10🙷 markets … they go up 80% of the time, they go
sideways 10% of the time, and they go down 10% of the time … while this
presents overwhelming opportunity, the caveat here is that the 10% down time
can wipe out the other 90% earned over time, if you’re careless … sidestep the
mini panics and crashes, and you’ll get rich plain and simple.
Don’t believe me? … directly below, in chronological order, the DOW30 CFD
since February 2016, when the FED began actively intervening in financial
markets.
click on any chart to enlarge
Taken all together, there are approximately 47 🙶trouble🙷 days for scalping from
the long side, out of approximately 840 trading days … that’s about 6% … if I
went back to 2008, and then 2003, it would be closer to 10% … this is where the
data supports the 🙶80/10/10🙷 premise … today, with more active
🙶Plunge Protection Team🙷 [PPT] activity along with corporate buybacks than
ever before, the back end 🙶10%🙷 has come down about 40% from 10 to 6 … this
is why it’s so difficult to make money trading the stock indices from the short
side, cuz everything about your trade has to be absolutely perfect every time, or
else you get stampeded … got news for you … it can’t be done consistently over
time!
I have known traders for decades who think the DOW30 should be at 600, or that
the big crash is coming every other day now … problem is, they go broke waiting
for it and never have the capital to take advantage of it when it arrives … read ZH
every day after the market closes, and in the recap read the same handles
predicting or pulling their hair out cuz stocks didn’t crash today … ever since
stock indices came onto the scene in April 1982, it’s been the same story from the
same people … stocks gotta crash! … my advice to them has always been the
same … 🙶when a crash comes, it comes … until then, make money from the long
side … the FACTS are striking … I don’t care what you think … leave your bias at
the door … you here to make money, or play analyst🙷?
Most offshore brokerage houses list a version of the DOW30 at 1✴ the index per
1 lot CFD … depending on the brokerage house, it can be traded either fractionally
or by whole integer … TURNKEY offers fractional DOW30 trading, meaning you
can lower your risk from ± $1 per index point, to whatever cents per point you
desire from a risk standpoint … obviously, this has major advantages for small
accounts.
As of this last Sunday update, the DOW30 20 Day Range MA stood at 500+ index
points … the low for the year around 200 index points … with approximately
85% - 90% of the day’s range during NYSE hours [9꞉AM EST - 4꞉00 PM EST]
… so, unlike gold and Cable, you can expect most of the day’s action in New
York, during the NYSE day … plenty of movement here for opportunity.
Financial markets today on 3 day weekend watch … meaning, I’d be very
surprised if anything happens up or down, unless there’s news [read Trump
and/or China] … very much looks and feels like a 🙶scumbag bank raping &
pillaging🙷 orders day in gold, with somewhat better trading conditions in the
DOW30 … front running and slippage the main features of today, right along
with the mystery ticks and spikes you’ve come to expect from almost ZERO
trading activity and massive 🙶scumbaggery🙷.
I will also mention that utilizing relatively low leverage is key to making solid
money in the DOW30 … you over leverage yourself in this puppy, and get on the
wrong side of a Trump tweet and/or China news headline, especially if your short,
and you will discover a new definition of pain. Although I won’t go as far as
saying don’t ever trade it from the short side, cuz there are moments, why would
you want to when over 90% of the time it wants to go up?
Going forward, now that the final algorithms are in place, I’ll be splitting time
between gold and the DOW30 … the DOW30 has more consistently better ranges,
better bid/offer spread, and overall better trading conditions than gold, but it also
has less 🙶scumbaggery🙷 … that doesn’t mean it doesn’t have any, but what it
does mean is that by being overwhelmingly long most of the time we trade, we
have the manipulators working for us … so, you girls on the 🙶Plunge Protection
Team🙷 [PPT], GO FOR IT!
Here in the PM of New York, now that Europe has closed, things have quieted
rather quickly … unless they decide to run stops, the day is over … not many
traders hanging around now … they’ve started the weekend early and will be back
on Tuesday. Gold for its part today, pretty quiet and uneventful, with New York
seeing about a $5 range for almost 6 hours of trading, with trips close to the high
and other trips close to the low … that’s called the 🙶Flying Wedge Of Death🙷
[FWD], and it’s no fun getting caught up in it, cuz most traders end up buying
the rallies and/or selling the breaks looking for an extension that never comes.
With gold VIX as low as it’s been today, no algorithm buy signals … some very
good algorithm buy signals in the DOW30 today, and we’ll pick this market up
come Tuesday’s trade action … blog update on Sunday … until then mi amigos
… Onward & Upward!!
Have a great Holiday weekend everybody!
-vegas
