No more perfect a portrait of pre Memorial Day Weekend trading can be found than this multi-day wedge of short-term volatility trading in UVXY. UVXY 15 Minute The first break of this pattern, either up or down, is almost always the fake-out, with the second break the one for the history books. Trade management demands that both be taken, just in case, since the real breakout or breakdown will be more than enough to compensate for the modest loss incurred by taking them both. As an example (rounded), PRO Service took both UNG and DBA calls on March 23rd, only needing/expecting one of the two to pay off. $5,000 into each trade has resulted in (1) UNG +400% = +$20,000, and, (2) DBA -50% ($2,500) = Total Proceeds +$17,500 or a total return of +350%. The next example will be QQQ/UVXY and it will take the form of before/after analysis, i.e., before circuit breakers vs after circuit breakers. We just don't know when those trigger. With next Monday being a U.S. Holiday, Tuesday May 31st is now front and center as best guess. If so, than how a trading account is set-up on Friday, May 27th, will be worth some serious planning. As has been our pattern recognition thesis YTD, another shoe is about to drop between now and July 4th weekend. PRO Pre-Holiday Trading Part II, Due Out Thursday-Friday
