What a week!
On Monday, I reiterated the projections I’ve been making for weeks for the SPDR S&P 500 ETF (SPY): 550-580.
This morning, SPY touched 550 before bouncing off and heading lower. What happens next for stocks is critical – I’ll tell you more about what I see on Monday.
On Tuesday, I gave you a special video update on the cryptocurrency market.
Surprise, I’m still bullish – and I still see BTC’s price between 87,000 and 109,000 by the end of this year. The stuff weighing on Bitcoin right now will resolve itself – and we’ll be off to the races.
I like that it’s hanging around $60,000 after going as low as $58,800 earlier in the week. I like that it hasn’t yet touched the May low of around $57,000. These are all good signs.
On Wednesday, we got back to our studies with the Cash Course, where I debunked the biggest myth on Wall Street…
And yesterday, I showed you why the Money Calendar is so much more than just a stock-picking tool.
We’ve covered a lot of ground – but we’re not done just yet.
Be today, we’ve got a fantastic reader question…
Take it away, Benedict!
Q: Tom,
Since you moved to Gulfport Analytics, I’ve noticed you’ve significantly reduced the number of alerts for Timed Trader Pro. Any problems? Also, for a long time I’ve seen no alerts with the straddle and butterfly strategies. It’s not a complaint, it’s only a question. But anyway, a big THAKS for your lectures and support.
All the best,
Benedict L.
A: Hi Benedict,
First things first, a big thanks for following me over to Gulfport Analytics!
This project has been months in the making, and I imagine it will be a few months more before we really start to dial everything in.
But I’m really proud of everything my team and I have built so far… and we can’t wait to show you what more we have in store for you.
Now, part of the reason why I started Gulfport Analytics was to get back to basics – and to focus my efforts on a few core strategies that I think are going to help traders grow and protect their wealth in 2024.
I made the hard choice to consolidate some of my older trading services so that I could give my readers the best of the best, the patterns and strategies that I trust the most to make you more money right now.
As a refresher, here are all the products available on Gulfport Analytics –
Stock Cycles Trader
In Stock Cycles Trader, I use my Money Calendar to track a lucrative 90% historically accurate pattern that shows up in the best 370 stocks in the market.
It’s simple. Money Calendar gives you the start and end date of each recommended pattern. All you have to do is buy shares on the start date and sell them on the end date.
These simple stock trades can deliver quick double-digit gains in about a month (usually 35 days or less).
Timed Trader Pro
Timed Trader Pro enhances the profit potential of my Money Calendar recommendations by a factor of 10 by using options.
We’re looking to trade calls and puts on these Money Calendar patterns for a shot at triple-digit gains in 30 days.
We’ll also take advantage of using debit spreads, which I call a “Loophole Trade.” This strategy lets us keep our risk to $500 or less for every trade.
Cash Flow Trader
In Cash Flow Trader, we use a cash-secured put-selling strategy to generate options income with a strategy with a 90% success rate in the last 4 years.
Every week, Cash Flow Traders get my very best 90% options income trade. All you have to do is place your trade, collect your premium, and wait for the option to expire worthless. This happens 90% of the time – and we get to keep every penny we collected.
Crypto Trend Trader
I use my Currency Waves system to trade in and out of the crypto market’s most explosive alt coins.
Using custom-built moving averages, my system identifies precisely when a coin is about to break for the upside.
And these moves can be massive.
We’re looking to get in and out with triple-digit gains – or more – in a matter of weeks.
That’s it. Right now, I’m laser focused on just four strategies in three asset classes.
Remember, as a trader, you want to keep your scope narrow. You can’t trade everything. You’ll never be profitable. Find your market, know your market, trade your market.
So I’m keeping it simple and paying attention to what works.
That said, there’s a specific reason why I haven’t recommended any staddles or butterflies lately…
Why I’m Not Trading Straddles and Butterflies Right Now
For the uninitiated, I want to make sure we have our terms straight.
Straddles and butterflies are both non-directional (or neutral) strategies.
A straddle involves buying both a call and a put on the same underlying stock. This is usually a volatility trade – you know the stock is going to move, you just don’t know which direction. As long as the stock moves, you profit.
There’s just one problem…
Volatilty has been below its long-term average for most of the year.
The CBOE Vix Index, which tracks volatility (the market’s outlook on how likely stocks are to make a move) is currently stitting around 12.30. That’s extremely low. If you need proof, the 200-day moving average is sitting at 14.41.
We’re seeing lower than average volatility, which means there isn’t a lot of juice out there right now for us to take on the risk of a straddle – especially since I’m not recommending trades around earnings right now.
A butterfly spread, meanwhile, is a neutral strategy designed to profit when the underlying goes nowhere. It’s a four-legged spread, a combination of a both bull and bear spreads on the same underlying stock. Butterfly spreads usually involve either four call options, four put options, or a combination of puts and calls with three strike prices.
Now to illustrate why I’m not trading butterflies, here’s the chart of the S&P I shared with you during Monday’s Five Points video…
The markets began a powerful uptrend starting all the way back in November 2023.
Then we saw a quick, healthy correction in April before powering higher in May and June.
I don’t know about you, but right now, I want to be a directional trader, catching as much of this upside as I can.
I’ve maintained a strong bullish outlook and stocks have been (mostly) going up since last November.
So I’m bullish. And I’m trading bullish.
Now, based on what I’m seeing, that could change in short order.
I’ll update you on Monday.
Until then!
Tom Gentile
America’s Pattern Trader