TT1! trade ideas
Cotton Commodity USA Sun Storm Investment Trading Desk & NexGen Wealth Management Service Present's: SSITD & NexGen Portfolio of the Week Series
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Value and Volume Approach to Life I have learnt about this concept in my sales days and I find it very useful in many parts of our lives as well.
In Sales, there are 2 main ways to do it (imo):
Value - Sell the high value ($) items . Eg. Product A is $10, Product B is $20 and Product C is $50
Selling 1 unit of Product C is equivalent to selling 5 units of Product A
Question is - Selling Product C may require a slightly different sets of skills and require a longer time to close it
Volume - Here, we are talking about the frequency of sales. So, you focus on as many units of Product A sales as possible to make up the total value you want , ie $50.
Applying this to investment -
Value - We can group IPOs , Cryptocurrencies and selective stocks that jump a few hundred percent returns a day! However, this is highly risky and the risk/reward ratio may be too high for some to stomach it. IPOs as we have seen are hit and miss kind of game as well. Not all are rosy and you end up holding a bag of losses which may take years to recover.
Volume - Here, you can increase the profitability of the game through your volume, ie. number of contracts or shares you hold for the investment. Many think that if they do not have huge capital NOW, then they will not partake in the game of investment. My take is simple, you can buy in staggered amounts at different times OF the same shares. For example, I love many China stocks like Alibaba, Tencents, Meituan, to name a few and have bought them at different price levels. I merely keep my position size (volume) the same.
Applying this to your career :
Now, most of us have a job and sometimes it takes a toll on our time and health that we have no energy to do other things, investment amongst one of them.
Value - you can term this as the outcome - is it gaining knowledge , experience , a stepping stone to the desired company/industry, good pay package, etc
Volume - Here , I merely measured it by the number of hours you put into it to generate the value.
Hypothetical case - you earn $5000 a month and you worked 40 hours per week so your hourly rate is 5000/40 which gives you $125/hour.
3-5 years from now, where would you want to see yourself ? 200/hour , 500/hour ?
When asked this question to some of my friends, they say job market is unpredictable and with COvid-19 , it makes it even more hazy. I agree to disagree.
By planning and committing to a financial goal, you need to work towards it. And that is having a plan. If you rely 100% on your active job for income, then seriously, you are also increasing your risks as well. Would your job be made redundant or would they downsize ,etc ?
Investing to me is one of the BEST way to reach the financial goal. Think of it as having multiple freelance jobs - one of which is researching the industry/companies and making decisions to ride on the trend. And even if you are a Noob, there are plenty of ETFs and low cost investment that offers you decent amount of returns without excessive risks on your part.
Volume in terms of hours is KEY. Because that is a finite resource. We all have 24 hours a day, whether you are Jeff Bezos or the janitor in a restaurant. Nobody can use money to buy an extra minute for the day! So, it is FAIR. What appears UNFAIR is how the rich make use of their time to gain even more value ($) for themselves. So 1% return on a 10m investment compared to 1% return on a 100 shares of Apple from 2 different investors would yield different returns (value terms).
Our lives are not only resided in our career, we still need time for our family, social lives, personal hobbies, community, spiritual, health, etc. We can find many articles of people who spent endless hours on their work only to endanger their health and others along the way. Worth it ? You think about it.
If you are in your 50-60s now, yes it is true that you can't turn back the clock to your 20's and start investing. But hopefully, your life experience would prepare you to be a more patient and rational investor instead of acting on impulses and acting irresponsibly with your money. There is always a trade off.
So, there you go, Value and Volume Approach to Life and I hope you use it wisely to benefit yourself and others as well.
LIVE CATTLE and COTTON shortCOT index is showing weakness on LIVE CATTLE, in the past this provided good entry spots for profitable short trades.
On cotton price action shows further selling.
somehow tradingview is not ideal for futures trading, on live cattle there is almost no gap on the may contract.
And there is no SCREENER that shows you that a futures instrument broke below prior days low
so all you can do is monitor the charts every day, or set a stop order to get you into the trade.
Cotton: ChannelDaily channel in the upper area of the monthly channel
Very small first target, it could be 120
Relationship between USD QE and raw material surge price.If you ever wonder how does USD QE (nonstop printing USD currency) affects inflation, this is the direct evidence using Cotton raw material price and USD monetary base as a reference.
Basically, the inflation is equal to the amount being printed out.
Buying Cotton below prior days inside bar worked outNow looking forward to exit on a new high
Buying below prior days inside bar worked out in the past for strong uptrending assets
Optimal Short Entry For Cotton FuturesRisk/Reward here is insane. Optimal long-term short entry. This is the third time cotton has been at this level in 50 years. Use good risk management unless an anomaly occurs like it did in the 2011 spike. Don't risk more than 1 to 2 percent of your total account size.
Trending Cotton No. 2 Futures breaking out!Something BIG is happening in the cotton industries..
Thank goodness we don't use cotton in our day to day life!
trend continuation to the downside for cotton. last week's massive drop in price resulted in a change in trend on the daily timeframe. using both trendline rejection and a breakout of the triangle pattern as confluence, I am setting a long-term take profit at the 95.50 region - weekly trendline & the next major support level
Better exit on cotton would have been at the tripple topNow my systematic exit to close a long trade if the daily bar closed below the 18 moving average
COTTON WOULD LIKE TO SEE COTTON retrace into the area I highlight on the charts as we are in a shift of times and inflations haha. Not trying to pick the top, we still bullish
Cotton appears to have broken through resistanceA resistance in the price of cotton of roughly .95 cents has been in place since 2012 and was recently broken. In 2010 cotton ran all the way up to $2.00 and started breaking north this time of year. It appears that the running quantity of cotton ginned in various parts of Texas through September 15th is down significantly from the prior year. Much of the rest of country hasn't started ginning as of yet. This will be something to watch over the next couple of weeks.
www.ams.usda.gov
Not investment advice, just my observation.
Why Implied Volatility Is A Critical Tool For All TradersTraders and investors use different sets of tools when approaching markets. Some are fundamentalists, pouring through balance sheets, supply and demand data, and other macro and microeconomic information to predict the future prices of assets. Others have a strictly technical approach to markets, following trends and the path of least resistance of prices. Still, others combine the two to look for opportunities where fundamental and technical analysis merge to improve the chances of success.
The past is history; the present is all that matters for traders and investors
Historical volatility is a map of the past price variance for asset prices
Implied volatility is a real-time sentiment indicator
The primary variable determining put and call option prices
The three critical factors implied volatility reveals
Yogi Berra, the hall of fame catcher and armchair philosopher, once said, “The future ain’t what it used to be.” All market participants have the same goal, to increase their nest eggs. Projecting the future is the route to achieve their goal.
Implied volatility is a tool that all market participants need to embrace as it is a real-time indicator of market sentiment.
The past is history; the present is all that matters for traders and investors
History depends on interpretation. When it comes to markets, Napoleon Bonaparte may have said it best, “history is a set of lies agreed upon.” An asset’s price moved higher or lower in the past because of a collection of variables viewed through a prism that leads to a collective conclusion that has broad acceptance but may not be accurate. Taking a risk-based position on an inaccurate conclusion could lead to mistakes and losses.
When we consider buying or selling any asset, all that matters is the present. The current price of any asset is always the correct price because it is the level a seller is willing to accept and a buyer is willing to pay in a transparent environment, the market.
Historical volatility is a map of the past price variance for asset prices
Historical volatility is an objective statistical tool that defines the price variance of the past. Any disclosure document tells us that past performance is no guaranty of future performance. We must view historical volatility precisely the same way, with more than a grain of salt.
Historical volatility is a guide, but remember what Yogi said, “the future ain’t what it used to be!”
We calculate historical volatility by determining the average deviation from the average price over a given period. When it comes to math, the formulas are:
A simple explanation of the complicated formula comes in seven easy steps:
1. Collect the historical prices for the asset
2. Compute the expected price (mean) of the historical prices.
3. Work out the difference between the average price and each price in the series.
4. Square the differences from the previous step.
5. Determine the sum of the squared differences.
6. Divide the differences by the total number of prices (find variance).
7. Compute the square root of the variance computed in the previous step.
Implied volatility is a real-time sentiment indicator
While we can calculate historical volatility from historical data, implied volatility is a different story. Implied volatility is the expected or projected volatility or price variance of an asset over time.
We back into calculating implied volatility using an options pricing model. We can establish an implied volatility reading by entering the option value into the Black-Scholes options pricing formula or other formulas that determine options prices. If we have a put or call options price, we can solve for the implied volatility level. The Black-Scholes formula in mathematical notation is:
The primary variable determining put and call option prices
There are no option prices without implied volatility as it is the critical variable that determines put and call option values. Yogi also said, “You can observe a lot by watching.” The current implied volatility level is the market’s consensus perception of what volatility or price variance will be during the life of the put or call option.
Observing and watching reveals the constant changes in implied volatility levels, which can be highly volatile over time. Option traders call an option’s sensitivity to changes in implied volatility Vega, which measures the change in an option price for a one-point change in implied volatility.
Implied volatility is constantly changing. Yogi had another great saying, “If the world were perfect, it wouldn’t be,” which rings true for implied volatility which can change in the blink of an eye. Option traders pay lots of attention to their Vega risk as the volatility of implied volatility can be…highly volatile! How’s that for a tongue twister?
The three critical factors implied volatility reveals
Implied volatility is a valuable tool for all traders and investors for three significant reasons:
It is a real-time indicator of the market’s perception of the future price range of an asset.
It can change suddenly, and changes often occur before the price of an asset reacts, making implied volatility a leading indicator.
Implied volatility reflects the wisdom of the crowd, and crowds tend to make better decisions than individuals. Moreover, it is reading that reflects the present, not the past, and is a constantly changing measure of consensus forecasts for the future.
As traders and investors, we exist in the present. We attempt to increase our wealth with long and short risk positions that either add or subtract from our nest egg in the future. Implied volatility is a critical measure we should understand, utilize, and always keep in our toolbox. Any project requires the right tools. Implied volatility’s value is that it reflects a snapshot of the current market’s consensus.
Historical volatility depends on “Deja vu” happening “all over again.” Implied volatility is a measure that understands that the “future ain’t what it used to be.”
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Trading advice given in this communication, if any, is based on information taken from trades and statistical services and other sources that we believe are reliable. The author does not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects the author’s good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice the author provides will result in profitable trades. There is risk of loss in all futures and options trading. Any investment involves substantial risks, including, but not limited to, pricing volatility, inadequate liquidity, and the potential complete loss of principal. This article does not in any way constitute an offer or solicitation of an offer to buy or sell any investment, security, or commodity discussed herein, or any security in any jurisdiction in which such an offer would be unlawful under the securities laws of such jurisdiction.
Cotton & PTA Cotton Futures open in China limit up after holidays. PTA (Purified Terephthalic Acid ) futures still in corrective phase and one to watch as Cotton replacement may kick in.
PTA may lag but should mean revert
Good profit since my last idea from level 92$Yesterday I posted an idea about cotton(short lower 92) and it goes down 3,5% .Reason for short have 3 main things :
1.Key level 92$ from D1 timeframe.
2.Instrument closed close to our level.
3.Clean area below our level.
With risk 20 cents it gave us 3 dollars profit.
Personally, I did not go into this tool becouse my login model was not there.
The main task is to determine the direction of movement,and we did it :)
Cotton.Short lower level 92$Global trend long, local trend short.We have key level 92$.Price cinfirm this level few times so we know-there are some bulls and lower this level they have stop losses.When price will broke this level I expect thet bulls will close their long possision and bears will open short possision so we should get some impuls down.With entrens be attention with next things :
1.Open possision only with low volatility.
2.Stopp loss not more then 20 cents.
Keep in mind that Cotton have some support level on 91$ so cover part of your possision few cent before this level :)
COTON NO2 - COTTON MARKET WILL GO UP IN THE NEXT 24 H - BUY NOWI confirm that the market will go up next 24 hours abouve 91.33 to 92.46
Buy Buy Buy .....
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