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S&P 500:
Examples of a Mid-Term Trades


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The following is a continuation of the 2005 volume surges report, listing possible trades and the returns that could be achieved in 2005 by simply trading the volume surges.

Chart 1. Relationship between volume moving average (VMA) surges and index reversal points. S&P 500 index. February - July 2005.
 
Table #1. Possible returns from Trading Volume Surges  
Trading Vehicle Returns
QQQQ Stock 34.68%
NASDAQ 100 Dynamic Funds 74.99%
QQQQ Options (summary return) 390.61%

When we calculated returns we followed the following rules:

  • These points are referenced in our PVO Oscillator History using the following settings:
     

    • Index: S&P 500;

    • Fast VMA: 2-day VMA;

    • Slow VMA: 25-day VMA;

    • Selling threshold: Go short if during a price advance the fast VMA rises 17% or more above the slow VMA;

    • Buying threshold: Go long if during a price decline the fast VMA rises 15% or more above the slow VMA.
      For more convenient possible return calculation from the simple trading system based on the magnitude of the volume surges we have compiled the list of trades that could be viewed here
       

  • The open and close price is calculated at the market close on the day when volume surge was read.
     

  • The table 4 show NASDAQ 100 price and the return calculated as double (x2) return from NASDAQ 100. The similar return could be achieved by trading Venture and Velocity Rydex Dynamic Funds.

Table 2: Dates that reflects points from the chart 1 with the possible return calculation by trading QQQQ options
Security   Symbol/Strike/Expiration Open Date Open Price Close Date Close Price Returns Summary
Return

Point
on Chart
QQQQ Buy Puts QQQCN/40/3/17/2006 01/27/2005 $2.05 01/28/2005 $2.50 21.95% 21.95% A
QQQQ Buy Calls QQQDJ/36/4/15/2005 01/28/2005 $1.90 01/31/2005 $2.25 18.42% 40.37% B
QQQQ Buy Puts QQQPL/38/4/15/2005 01/31/2005 $1.45 04/15/2005 $3.20 120.69% 161.06% C
QQQQ Buy Calls QQCFI/34.63/6/17/2005 04/15/2005 $1.32 06/17/2005 $3.20 142.42% 303.48% D
QQQQ Buy Puts QQQTL/38/8/19/2005 06/17/2005 $0.90 06/24/2005 $1.25 38.89% 342.37% E
QQQQ Buy Calls QQQIJ/36/9/16/2005 06/24/2005 $1.95 09/01/2005 $2.85 46.15% 388.52% F
QQQQ Buy Puts QQQWN/40/11/18/2005 09/01/2005 $1.50 09/21/2005 $1.70 13.33% 401.85% G
QQQQ Buy Calls QQQLL/38/12/16/2005 09/21/2005 $1.70 11/03/2005 $2.35 38.24% 440.09% H
QQQQ Buy Puts QQQMN/40/1/20/2006 11/03/2005 $1.05 12/19/2005 $0.30 -71.43% 368.66% I
QQQQ Buy Calls QQQCN/40/3/17/2006 12/19/2005 $2.05 01/04/2006 $2.50 21.95% 390.61% J

Table 3: Dates that reflects points from the chart 1 with the possible return calculation by trading QQQQ stock

Security   Open Date Open Price Close Date Close Price Returns Compound
Return

Point
on Chart
QQQQ Short 01/27/2005 37.10 01/28/2005 36.92 0.49% 0.49% A
QQQQ Long 01/28/2005 36.92 01/31/2005 37.40 1.30% 1.80% B
QQQQ Short 01/31/2005 37.40 04/15/2005 34.74 7.11% 9.03% C
QQQQ Long 04/15/2005 34.74 06/17/2005 37.87 9.01% 18.86% D
QQQQ Short 06/17/2005 37.87 06/24/2005 36.97 2.38% 21.69% E
QQQQ Long 06/24/2005 36.97 09/01/2005 38.92 5.27% 28.10% F
QQQQ Short 09/01/2005 38.92 09/21/2005 38.50 1.08% 29.48% G
QQQQ Long 09/21/2005 38.50 11/03/2005 39.94 3.74% 34.33% H
QQQQ Short 11/03/2005 39.94 12/19/2005 40.62 -1.70% 32.04% I
QQQQ Long 12/19/2005 40.92 01/04/2006 41.74 2.00% 34.68% J

Table 4: Dates that reflects points from the chart 1 with the possible return calculation by trading Dynamic funds that track the NASDAQ 100 index

Security   Open Date Open Price Close Date Close Price Returns Compound
Return

Point
on Chart
Nasdaq 100 Dynamic Short 01/27/2005 1507.55 01/28/2005 1499.46 1.07% 1.07% A
Nasdaq 100 Dynamic Long 01/28/2005 1499.46 01/31/2005 1519.63 2.69% 3.79% B
Nasdaq 100 Dynamic Short 01/31/2005 1519.63 04/15/2005 1408.59 14.61% 18.96% C
Nasdaq 100 Dynamic Long 04/15/2005 1408.59 06/17/2005 1538.13 18.39% 40.84% D
Nasdaq 100 Dynamic Short 06/17/2005 1538.13 06/24/2005 1500.18 4.93% 47.79% E
Nasdaq 100 Dynamic Long 06/24/2005 1500.18 09/01/2005 1577.25 10.27% 62.98% F
Nasdaq 100 Dynamic Short 09/01/2005 1577.25 09/21/2005 1561.84 1.95% 66.16% G
Nasdaq 100 Dynamic Long 09/21/2005 1561.84 11/03/2005 1619.67 7.41% 78.47% H
Nasdaq 100 Dynamic Short 11/03/2005 1619.67 12/19/2005 1664.36 -5.52% 68.62% I
Nasdaq 100 Dynamic Long 12/19/2005 1664.36 01/04/2006 1695.83 3.78% 74.99% J

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Disclaimer: The chart example is intended for educational purposes only - it does not constitute trading advice, nor does it make or imply any market trend predictions.

 

NASDAQ 100 Examples:
April 2006 (Short-Term)
March 2006 (Short-Term)
Example 1 (Mid-Term)*
Example 2 (Short-Term)*
Example 3 (Short-Term)
Example 4 (Long-Term)
Example 5 (Mid-Term)
Example 6 (Mid-Term)
Example 7 (Short-Term)

S&P 500 Examples:
2005 Mid-Term Summary
2005 Mid-Term Summary (trades)
July 2005 (Mid-Term)
June 2005 (Long-Term)
March 2005 (Short-Term)
April, 2004
April, 2004 (Long-Term)
April, 2004 (Mid-Term)
March, 2004 (Short-Term)
Example 2 (Mid-Term)
Example 3 (Short-Term)
Example 4 (Long-Term)
 Example 5 (Long-Term)
Example 6 (Mid-Term)
Example 7 (Mid-Term)
 Example 8 (Mid-Term)
Example 9 (Short-Term)
Example 10 (Short-Term)

 


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1/6/2009 - SV3