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Chris Vermeulen
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Chris Vermeulen the founder of AlgoTrades.net Algorithmic Trading Systems. This automated investing system is designed for individual investors and traders. He is also the editor of the TheGoldAndOilGuy newsletter which is designed for gold market traders providing quality ETF Trade Alerts,... More
My company:
AlgoTrades Algorithmic Trading Systems
My blog:
TheGoldAndOilGuy - Gold Market Traders
My book:
Technical Trading Mastery - 7 Steps To Win With Logic
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  • Gold Option Trade – Will Gold Continue To Consolidate?

    Until recently, the world has forgotten about gold and gold futures prices it would seem. A few years ago, all we heard about was gold and silver futures making new highs on the back of the Federal Reserve's constant money printing schemes. However, after a dramatic selloff the world of precious metals it became very quiet.

    Gold prices have been in a giant basing or consolidation pattern for more than one year. As can clearly be seen below, gold futures prices have traded in a range between roughly 1,175 and 1,430 since June of 2013.

    (click to enlarge)

    The past few weeks we have heard more about gold prices as we have seen a five week rally since late May. I would also draw your attention to the fact that gold futures also made a slightly higher low which is typically a bullish signal. GLD, SLV, GDX,GDXJ,SIL,NUGT, DUST

    At this point in time, it appears quite likely that a possible test of the upper end of the channel is possible in the next few weeks / months. If price can push above 1,430 on the spot gold futures price a breakout could transpire that could see $150 or more added to the spot gold price.

    Clearly there are a variety of ways that a trader could consider higher prices in gold futures. However, a basic option strategy can pay handsome rewards that will profit from a continued consolidation. The trade strategy is profitable as long as price stays within a range for a specified period of time. Ultimately this type of trade strategy involves the use of options and capitalizes on the passage of time.

    The strategy is called an Iron Condor Strategy, however in order to make this trade worth while we would consider widening out the strikes to increase our profitability while simultaneously increasing our overall risk per spread. Consider the chart of GLD below which has highlighted the price range that would be profitable to the August monthly option expiration on August 15th.

    (click to enlarge)

    As long as price stays in the range shown above, the GLD August Iron Condor Spread would be profitable. Clearly this strategy involves patience and the expectation that gold prices will continue to consolidate. This trade has the profit potential of $37 per spread, or a total potential return based on maximum possible risk of 13.62%. The probability based on today's implied volatility in GLD options for this spread to be profitable at expiration (August 15) is roughly 80%.

    Our new option service specializes in identifying these types of consolidation setups and helps investors capitalize on consolidating chart patterns, volatility collapse, and profiting from the passage of time. And if you Advanced options trades are not your thing, we also provide Simple options where we buy either a call or put option based on the SP500 and VIX. The nice thing about buying calls and puts is that you can trade with an account as little as $2,500.

    If You Want Daily Options Trades, Join Technical Traders Options Alerts: www.TheTechnicalTraders.com/options

    Chris Vermeulen

    Jul 04 12:57 PM | Link | Comment!
  • If You Miss The Breakout In Gold Stocks You Need To Do This…
    Back in the day when I was a newbie trader and investor I used to follow several stocks, sectors and commodities that had a setup chart patterns. I would draw all over them and then wait to catch the day of the breakout.

    Unfortunately I would miss a good chunk of the trades because they would breakout when I want not watching the chart forcing me to miss some unbelievable momentum and swing trading opportunities. I used to get rather frustrated with trading to put it kindly.

    But I eventually learned that there are several ways to avoid this from happening and each of these options work much better than watching the charts like a hawk waiting for that breakout that may or may not happen.

    The beauty of my trading system is that it allows me to buy on the breakout whenever a strong breakout happens without me, I have methods that will automatically enter me into a long position on the first pullback after a confirmed trend reversal.

    The positive trade-off of buying a pullback that follows a trend reversal or chart pattern is that buying pullbacks is often lower risk than buying breakouts because there is a lower risk of the breakout failing.

    Before I get into those details let me update you on what gold stocks just did and what I expect them to do in the near future.

    Recently we have seen big money move into gold stocks. Gold and silver stocks are popping on high volume which is great to see. While it is exciting gold stocks are not yet in the clear from further selling or sideways trading.

    If you are familiar with Stan Weinstein or have followed my work for a while you likely understand the four stages the market goes through (same on all time frames). Looking at the chart below its clear that the gold stock index HUI has completed a stage 4 decline and appears to be in the second half of an accumulation stage 1.

    The stages in this chart I am talking about are big picture trends which last a year or two, more of an investors 35,000 foot view on the market. I breakout and rally above the $280 level will be very bullish, any pause or pullback after that will provide a low-risk opportunity to get involved.

    I will let you in on a little secret of mine, and almost never buy an upside breakout, I actually wait for the first pullback. And on the flip side, I always short on the breakdown, and if I miss it, I will then get short on the first bounce.

    If you have not read my report on the next countries to start bull markets then checkout it out here: Click Here

    (click to enlarge)

    In my next article I am going to tell you exactly how to avoid missing the breakdowns and how to be entered automatically into these trades when the market has its first pullback for 100% Hands-Free Trading.

    Find This Article Educational? Delivered To Your Inbox Free Here www.GoldAndOilGuy.com

    Chris Vermeulen

    Jun 27 2:51 PM | Link | 1 Comment
  • Invest In Countries That Are Starting A Bull Market - Look At These Ones!

    Research proves that undervalued equity markets achieve higher future returns over longer term investment horizons.

    Studies show that investing in markets which have just been through a bear market and their valuations are low is one of the best ways to grow your investment capital.

    In 2012 Ireland was one of the countries with lowest PE ratio and a couple years later and 100% rise in the EIRL (Ireland ETF), it is now the second most overvalued country.

    Every year there are several markets that are bottoming and starting a new bull market. The key is finding them and being prepared to lock up some of your investment capital in these longer term investments.

    On Wednesday I recorded my call with Kerry Lutz of the Financial Survivor Network. We talked about a couple new bull markets that were starting and the one which I like the most.

    Listen To Call:Click Here

    I believe the best way to be successful as an investor is to actively manage your portfolio. And when I say actively manage it, I mean, you should be rotating your money out of underperforming stocks, sectors, commodities, and index positions and moving that money to fresh investments which more room to rise.

    In a week or so I will be doing a detailed report on how many positions a portfolio of various sizes should be holding. You will be surprised with what this report is going to tell you.

    In short, the less the trades you make and the fewer positions you hold in your portfolio can make a dramatic impact on your portfolio volatility, time commitment, stress levels and performance.

    Diversification between a small selection of investments and strategies is vital. This is not rocket science, anyone can do it and I will show you how.

    Anyway, let's get back to undervalued markets…

    You have to invest in markets and sectors that have just gone through a bear market. By doing so you can look forward to years of upside growth.

    Cheapest Markets, and Most Expensive MarketsAutomated Investing System

    This table shows the valuations of world markets with the most recent data available.

    Looking from an evaluation stand point and long term investing Russia, China and Greece are the most undervalued. And if we take an average PE ratio of the majority of counties of 20, then we can calculate a rough percent return each country should provide in the coming years.

    Keep in mind, these markets can still be volatile and if you are a short term trader its best not to trade based off fundamentals and valuation. Hedge fund robots and my automated investing system do not and most US stock market participants do not either.

    Charts of Undervalued Country ETF's

    These charts just show a simple snap shot and their first upside target before they run into some long term resistance.

    Automatic Investing Strategy

    Automated Investing Strategy

    (click to enlarge)

    Long Term County Specific Investing Conclusion:

    In short, this report is simple and uses a logical strategy. Again, it is critical to have a diversified portfolio with completely unrelated investments (different countries) and also to use different investment strategies and time frames to balance portfolio volatility.

    I believe you should have long term holdings and short term holding using both long and short positions. Short positions allow you to profit from a falling market, and some of the biggest and fastest money can be made with this strategy and is a vital strategy within my automated investing system.

    Learn About My Investing Strategy Here: www.AlgoTrades.net

    Chris Vermeulen
    CEO & Founder

    AlgoTrades.net

    Jun 23 8:55 AM | Link | Comment!
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