The markets have been extremely volatile and unpredictable lately… more so than it usually is this time of year.
But that doesn’t bother me. In fact, I thrive in volatile markets like this — and so does my Burn Notice strategy.
It means we’re in a “trader’s market.”
And the abnormally large sell-offs in sectors like technology and market rotations into cruise lines we've seen lately gives traders more opportunities to make money, regardless of whether stocks move higher or lower.
You guys know the type of trader I am — I don't fall in love with any trade, any security. I don't like to follow the herd.
That ain't me.
So now my approach to trading the market is simple: Win every day.
Now, that doesn't mean we win every trade or every day or even every week. It does mean I go into every opportunity looking to max out my odds of victory.
One of my top strategies to do that? Fading the market.
You see, Wall Street firms are receiving buy and sell orders from clients all day, every day. We’re talking billions of dollars moving back and forth.
And do you know what time this phenomenon begins to happen? Roughly around 3 p.m..
So every day at 3 p.m. I watch for a specific market signal that could lead to overnight gains, again and again. It’s what I like to call the Burn Notice signal.
And that’s exactly what I did this past Monday afternoon when I sent out a trade alert for Expedia Group Inc. (Nasdaq: EXPE) to my Burn Notice service members.
At the time of the alert, the Nasdaq had been up for 11 days in a row and EXPE had been teari higher for the previous two trading sessions — up over 20% from Nov. 4 lows. The reopening trade was — and still is — in full steam, but I expected the theme would cool down alongside the Nasdaq.
*SPOILER ALERT: The cool down was ice-cold.
I also knew that EXPE was at the intersection of both those things. And, most importantly, I knew that what comes up must come down. It was just a matter of time before the stock dipped after jumping up more than 16% on Friday following its third-quarter financial report.
Just take a look at the following chart. You can see EXPE beginning to slightly lag behind.
In my alert, I told traders to short the stock and buy the 12/17/2021 $175 puts over the last 30 minutes of the trading day.
The next morning, Tuesday, I looked at my Bloomberg terminal and saw that EXPE was indeed looking to open lower — as Tripadvisor had weak guidance. I suspected that it’d be a cool-off morning in the red travel stocks, so I told my members to trade out of the stock over the first two hours — ending by 11:30 a.m. EST.
Within 30 minutes, the stock fell more than 2%.
And BAM! 10% overnight!
My Burn Notice members got a nice 10.77% return on the options, and a decent 0.70% gain on the stock.
And it’s not too late for you to get in on this, too.
You see, I send out trade alerts just like this almost every single day. My members get a trade alert everyday at 3 p.m. signalling to them which stock is on my radar and I’m looking ready to fade.
Historically, November is one of the most volatile months of the year. It’s a real “trader’s market,” and, given the volatility we’ve already seen, I have a great feeling about this November.
That’s why now is a great time to jump into our strategy.
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