how to profit from trading international etfs
DESCRIPTION
Deron Wagner is a professional trader, author of several best-selling trading books, and founder of Morpheus Trading Group. Recently, he presented a live workshop at the International Traders Expo in Dallas, Texas, in which he shared his basic trading strategy for international ETFs (exchange traded funds). This is the slideshow that accompanied his presentation.TRANSCRIPT
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Profit from trading international ETFsHow To Profit From Trading International ETFs
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Let's Get Started...
What are international ETFs? ETFs that trade on U.S. stock exchanges, but
whose underlying indexes are comprised of a basket of foreign stocks and ADRs
What are the benefits of trading them? Most have relatively low correlations to
direction of major U.S. stock market indices Some foreign countries & regions have
economic cycles that are not necessarily in sync with U.S. economic cycle.
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UptrendingUptrending DowntrendingDowntrending Range-boundRange-bound
Determine overall trend of main U.S. stock market indicesDetermine overall trend of main U.S. stock market indices
Find ETFs with relativeFind ETFs with relativestrength or weaknessstrength or weakness
Find ETFs withFind ETFs withrelative weaknessrelative weakness
Find ETFs withFind ETFs with relative strengthrelative strength
Confirm with longer time framesConfirm with longer time frames
Buy strongest ETFBuy strongest ETF Sell short Sell short weakest ETFweakest ETF
Buy and/or Buy and/or sell short ETFssell short ETFs
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Quickly finding relative strength and weakness...
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Keys to relative strength trading
Relative strength must be assessed on a relative not absolute basis
Relative strength should be spotted quickly; if it takes too long, there is not relative strength
ETFs that do not fall when the main stock market indexes fall are the first to surge higher when the broad market bounces (and vice versa)
Don't “hope” a weak ETF will “catch up” to those with relative strength
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Finding ETFs with relative strength
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Confirming with longer time frame
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Finding ETFs with relative strength
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Confirming with longer time frame
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Confirming with longer time frame
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Confirming with longer time frame
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Finding ETFs with relative strength, BUT...
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Lacking confirmation with longer time frame
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Lacking confirmation with longer time frame
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Putting it all together – An actual recent trade
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Putting it all together – An actual recent trade
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Putting it all together – An actual recent trade
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Summary overview of strategy
1) Determine direction of overall trend of main U.S. stock market indexes
2) Use “percentage change” charts overlaying various international ETFs vs. the S&P 500 Index
3) Quickly find ETFs showing the most relative strength or weakness to the broad market
4) Look for confirmation of chart patterns on longer time frames
5) Use standard breakout or pullback strategies to buy or sell ETF trades
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Profit from trading international ETFs
To learn more about our proven strategy for swing trading stocks and ETFs, visit MorpheusTrading.com
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