One New Unbelievable Trading System for Less Money Are You Kidding Me?
We are combining the Classic (Intermediate Term) and Prime (Short-Term) systems into one. It is the very nature of this new system that makes time frames irrelevant. There will be plenty of new trades for all.
Partial List of New Trading Symbols
AMGN AMZN APC BA BABA C CELG FB FXI GOOG GS HP IAC IBM IWM LUV NFLX NVDA PYPL QQQ REGN SOXX SPY SQ TLT TWTR USO V VXX VZ
For anyone who wants to trade the system but not the options, there are several ETF's on the list (IWM, QQQ, SPY, TLT, USO), all of which have inverse and/or leveraged counterparts.
In the first half hour of trading I will send out a daily update with new signals that are generated at the Open. There will be many days with no trades. When appropriate I will include comments about the trade, the market, the weather, whatever. Interim intraday email alerts will be rare, but if you get one, you better read it. As is already the case, all updates and alerts will be both emailed and posted on the Blue Line website.
Weekend Updates will continue as usual, with bigger picture analysis, tutorials (like this one) and an occasional special situation that doesn't quite fit into the trading system.
Trading System Changes
Old System: We traded 10-15 stocks/ETF's from trend to trend, always in the market or individual stock, Long or Short. Stops were optional and to be honest, confusing. That's fixed now, see below.
(a) Expanded basket of stocks and ETF's on a rotating basis;
(b) As before, we will be trading option positions with the dominant trend;
(c) Exits will be based on profits, not trend reversals, with a fixed percentage gain on the option trade (that percentage is traders choice, see stats below);
(d) As price enters then exits predictable retracements we will re-enter the dominant trend with a new option;
(e) And again, exiting with a fixed profit percentage.
75% of options reach a +50% gain at some point in the trade;
67% of options reach a +100% gain at some point in the trade;
33% of options reach 200% (or more) gain at some point in the trade.
Note: About 25% of trades don't reach at least a 50% gain. Some reach break-even, some get wasted. It's the nature of the beast.
(a) None. Stops have never helped profitability and have only ruined perfectly good systems. So on any one trade, be prepared to lose it all. Based upon our testing, it will happen, but not very often;
(b) Alternatively, a 75% stop can be employed with some, but minimal degradation of overall results. Anything tighter than about 75% will result in whipsaws out of many trades that go on to triple-digit gains.
Each trader will be responsible for his/her own exits. You can place a Sell-Limit order after entering your trade, for a gain of 50%-100%-200%, whatever suits your style. I personally am targeting +100% gains and when hit will exit 85% of my position, leaving 15% on the table as my "lottery ticket," for future appreciation.
New Subscribers Only
I practiced law in Atlanta for close to 20 years, so I have to write this, and you have to read it:
*These performance numbers are based upon historical backtesting and as such must be considered hypothetical. Although every effort has been made to preserve the integrity of the methodology, hypothetical results have certain intrinsic limitations, including but not limited to the fact that these results are not reflective of an actual real time trading log, they are also subject to assumptions inherent in option results as implied from hypothetical trading, No representation can be made that any account will or is likely to achieve profits or losses corresponding to the historical backtesting.
I made one tweak in the way we define tradable trends, and then one tweak in the way we trade them. What is left standing is the very best stock and option trading system I have ever had the pleasure, and confidence, of trading.