Maximizing Profits with Market Timing in Swing Trading Strategies
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Chapter 1: Understanding Market Timing in Swing Trading
Swing trading involves strategically buying and selling ETFs based on market indicators. For short-term trades, one should buy ETFs at the next market opening when the NYMO indicator rises, and conversely, sell when it declines. For longer-term strategies, the NYSI indicator serves a similar purpose: buy when it trends upward and consider cashing out or shorting when it trends downward.
Market trends generally dictate ETF movements, making leveraged positions particularly effective for this strategy.
Now, let’s analyze how FNGU performed during a recent 15-day trading period when the NYSI was on the rise, while the NYMO fluctuated. FNGU recorded a 14.5% gain after opening on March 17, although it peaked at over 41% before the current sell-off. During this timeframe, five trades based on the NYMO signal resulted in an impressive 80% success rate, yielding a profit of 45.2%.
Section 1.1: Recent Performance of FNGU
On February 23, 2022, the landscape for FNGU, which tracks major tech stocks like Apple, Microsoft, and Google, shifted dramatically. Following a NYMO sell signal, this leveraged ETF saw a decline of 20% over three trading days.
For those positioned for a downturn, this presented a lucrative opportunity. Year-to-date, the NYMO swing signals had indicated a market drop of 30% before this recent downturn. Moreover, FNGU has also broken through the lower boundary of a significant Darvas Box. If it does not recover swiftly—ideally by tomorrow—the ETF and its underlying assets may face severe declines in the near future.
In essence, this pattern exemplifies the typical behavior of a bear market, characterized by a cycle of declining prices until a reversal occurs.