Until today, I had been holding FAS/FAZ overnight and treating them as long term plays waiting for the big pop in either of the two. After getting burned twice and just staring at my screen watching grass grow on another couple of occassions, I decided the strategy of small, gradual compunded gains was the better way to go. So I bought in at the low of the day and sold at the high of the day for a small gain of $800. Guys and gals, this really is the strategy that works best with these 3X ETFs. If you're under and it gets to a point where you can recoup your losses, sell and just daytrade these two. Even if you miss the pop in the morning in either, they almost always pullback just before lunch, allowing you to get back in at a good entry point. Be happy with 5%-10% gain. Do that everyday and it will begin to add up since you are compounding your gains.
You can only trade FAS & FAZ if Wall Street keeps the bank stocks in a 1.00-3.00 trading range.
You know the market went up 7 weeks in a row. I really doubt they can keep doing this week after week. As you can see less and less people are buying JPM at these price 33.00-35.00 Today.. you see JPM in the 32.00 range
It's showing signs of technical breakdown and overbought territory.
If they can keep JPM at a range of 30.00-35.00 for another 7 weeks.. Yes, it makes sense to daytrade FAS & FAZ back and forth. My gut feeling tells me JPM is about to break down and it could fall all the way to 25.00-27.00
JPM around 30.00
FAZ probably trade around 11.00-13.00
Let's say Wall Street decided to tank the market next month and do a 3 or 4 down weeks.
JPM tank to low 20s WFC down to 12.00-13.00 and so on.,
FAZ most likely will run to ($25.00-$30.00)
if they keep doing this trading range for 2 or 3 weeks.. both FAS & FAZ will decay to $5.00-$6.00
THE QUESTION NOW IS DO YOU THINK THEY CAN HOLD JPM AT $30.00-$35.00 FOR ANOTHER 2 to 3 weeks ??
up 7 weeks already up another 2 weeks .. up 9 weeks in a row
I been doing that as a hedge and it works great. But it seems like these two ETF's are getting sick. 5% to 10 % great for a day trade. Just keep an eye though you can even made money going short on the two of them as well. Good luck man.