MZZ Ultra-Short | Online Stock Trading
You’ve gotta love the new MZZ Double Short ETF. Trading this Exchange-Traded Fund online is going to be fun. The trading guy really hasn’t seen any rules yet on trading MZZ, Ultra-short Mid-cap 400 in an IRA. Trading is as normal in an online trading account. It hasn’t been shortable yet though. Borrowed from Proshares description, ‘The UltraShort MidCap400 seeks daily investment results, before fees and expenses, that correspond to twice (200%) the inverse (opposite) of the daily performance of the S&P MidCap 400 Index.’ We’re not going to worry about that though because patterns are the trading guy’s only concern. Lets look at a recent trade in MZZ.
A technical pattern emerged in this ETF on Friday and was entered on the uptrend. Note the three last pivots followed by the higher high. A stop was set below the all-time low as this is one volatile equity. That’s the kind we like to trade! Risk, R was set accordingly, and the target was set at 1R for this first time trading the MZZ. 69.65 was the low and the trigger hit over 71.65. 73.65 was the target. Note that this pattern the BL2, Bull Long 2, is opposite the Bear Short 2. With the BL2 the trader waits for a higher low pivot followed by a higher high candlestick, for entry.
Note how the stock really didn’t do much the first day closing down from entry. Stops would be raised daily and placed under the low for the day with a .16 cushion to avoid shakeouts. Today that stop was missed by a penny. MZZ rocked after that and the trade was exited, 1/2 near 74 and the rest near the close.
It will be interesting to see if MZZ trades to it’s trendline quickly, as this is also a FBS2. Those stock chart patterns can head higher fast. The MVV, Ultra Mid-cap 400 is the long version of MZZ. I’m sure trading that ETF will be occur soon at Online Stock Trading.
September 12th, 2006 at 10:54 pm
[…] I spotted this perfect BL2 trading pattern in a scan last night. Kyphon Inc. was entered as it broke yesterday’s high. A stop was set below the day’s low. R was = to .20 after getting filled in a fast pop over the candlestick from yesterday. The stop would be raised using pivots. 3/4 of the shares were sold for 6R. The stock took off and never looked back. Anything can happen overnight, so only a 1/4 was carried over. The current stop is under the last pivot of 37.04 on the 5-minute chart. […]
September 18th, 2006 at 10:27 pm
[…] Since gold stocks were acting strong I looked for an intraday entry, instead of waiting for a higher-high to trigger on the daily chart. The 15-minute chart provided a bullish pattern for entry. […]
October 13th, 2006 at 7:43 pm
[…] You could consider the first red bar of Acme Packet’s stock as being a capitulation bar. Those investors lucky enough to get allocated shares, dump them. Point 1 (BL2)of the EHTH 5-minute chart show the first entry that was taken. IPOs can trade fast. Profit was taken when a point was achieved. EHTH built an area of support just above the area of 22 with a couple of quick dips. I had an alarm set in the 22.2 area to alert me, but was in the bathroom at the time. What can you do sometimes! Point 2 (BL2) shows the next entry. Point 3 shows an area of resistance the stock needed to mount. A BL3 occurred with an hour of online stock trading to go. The stock is added here, or you buy the stock if you missed the earlier entry. I can’t emphasize enough how looking at multiple time frames has made me a better trader. […]
January 3rd, 2007 at 12:32 pm
[…] Check out the weekly chart. Would you want to hold HIHO any longer than you have to? Holding too long may have you singing, HIHO, HIHO, it’s off to the poor man’s trail we go. Anyway, good to see Highway Holdings play out as planned. Note that this pattern works best on the first bounce (more example trades of this trading pattern). […]