Trade Alert - (ROM) March 19, 2020

When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline.

Trade Alert - (ROM) - BUY

BUY the ProShares Ultra Technology ETF (ROM) at $100.01 or best

Opening Trade

3-19-2020

Portfolio weighting: 10%

Number of Shares = 100 shares

I believe that shares are now more oversold than at any time in market history.

In addition, the Mad Hedge Market Timing Index is at a very low 6, a 3-year low.

I am therefore buying the ProShares Ultra Technology ETF (ROM) at $100.01 or best.

If you have a Great Recession type of stock market, you have to employ a Great Recession type trading strategy.

Fear has outrun the actual facts of the epidemic the market by 1,000 to one. You still have a greater chance of winning the lottery than dying of the Coronavirus. When markets figure this out, which could be in weeks, we could rapid recover half of the recent 11,000 point loss in the Dow Average in a gigantic rip-your-face-off kind of rally.

The 200-week moving average at 23,629 would be a nice initial target.

So, I have been dusting off some of my favorite trades for a decade ago, when we were dealing with similar levels of panic, despair, and desperation.

Suddenly, the (ROM) came to mind.

The (ROM) is the ProShares Ultra Technology ETF, a 2X long in the top technology shares. It holds the fastest growing cream of the cream of corporate America which you want to own and hide behind the radiator forever. Quality is on sale now and here is where you want to be loading the boat. (ROM) even pays a modest 0.17% dividend.

(ROM)’s ten largest holdings include:

Microsoft (MSFT)
Apple (AAPL)
Facebook (FB)
Alphabet (GOOGL)
Intel (INTC)
Cisco (CSCO)
Adobe (ADBE)
NVIDIA (NVDA)
Salesforce (CRM)
Oracle (ORCL)

(ROM) has held up pretty well in the crash. During the 11,000 point, or 37.3% collapse in the Dow Average, the (ROM) fell by 58%. Back out the 2:1 leverage and its underlying shares are down by only 29%. That’s because major holdings have barely moved, like Apple (AAPL), down 26%, and Amazon (AMZN), which is off only 25.2%.

To learn more about (ROM) please visit their website by clicking here.

Don’t pay more than $103 or you’ll be chasing.

Here is the specific trade you need to execute this position:

Buy 100 (ROM) at…………...........................………$100.01

Net Cost:………………………….………..………….….....$10,001

Don’t execute the legs individually or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.

Keep in mind that these are ballpark prices at best. After the alerts go out, prices can be all over the map.

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