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To say the markets have been volatile is quite the understatement.
For instance, The Dow Jones Industrial Average has seen a 1,000-point price swing in one day. It's not uncommon to see less "severe" price swings of 300 to 400 points these days, too. And while the S&P 500 is up, it's only by 0.66% - a measly less than 1% that was far more stressful for many people to attain than just sitting out altogether.
To make things even more difficult for investors and traders alike - these aren't one-directional swings. So one second, the market's skyrocketing 400 points, and the next, it's taking a 500-point plunge.
Needless to say, 2018 has not provided us with the consistent and stable market that 2017 did at one time.
But there's one sector that's been ignoring these turbulent conditions - and could deliver your next triple-digit win...
See, when this type of volatility arises, I always look for the sector/sectors that are boasting consistent price patterns.
While doing this, I analyze the same period of time for different stocks and sectors to see which is outperforming the other. This is referred to as positive relative strength.
One way to calculate relative strength is to take the rate of change of one sector and divide it by the rate of change of the other over that same period of time. A calculation of greater than 1 is deemed relatively strong, whereas a result of less than 1 indicates the sector or stock is weak or showing weakness.
An even simpler way to measure positive relative strength is to compare the percentage returns. The one with the highest is doing the best.
Here's what that means right now...
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The table pictured above shows the S&P 500 sectors. As you begin to compare the numbers, trying to identify the positive relative strength, you will find that technology (XLK) is presenting the best strength in the market at this this time.
That's why I would recommend a bullish call trade in the XLR sector.
And the great thing is, the same logic works in the reverse as well.
If you like the idea of stocks dropping steeper on a percentage basis, you would look at the stock or stocks with the largest negative percentage move year to date. From there, you would pursue a bearish option strategy, like a long put.
And this is why I always advocate to stick to our strategies.
Even in the worst volatility, the tools we use still work the same - because at the end of the day, it's all about the numbers.
So trust the process, and block out the noise. The volatility may not be over - but our profits won't stop.
And don't forget, the best method to profit in this kind of market is to face the volatility head on.
For example, the cryptocurrency market grew by 3,086% last year, with some major price spikes and drops as high as 50% in a single day.
But those who were lucky enough to get in and out of these coins while they were on the upswing had the chance to make thousands, even millions of dollars.
That's why I applied the patent-pending technology behind my Money Calendar to analyze the crypto markets.
And when my team and I sifted back through 2017, they immediately found 79 different trades with extraordinary returns within just a few minutes...
And out of the 79 different trades, 40 exceptional ones returned more than 5,000%... all while the cryptomarket was rising and falling at any time within a blink of an eye.
Now, I'm turning this incredible, moneymaking power over to you.
Each and every week, I'm going to be recommending a new cryptocurrency that has the potential to turn a tiny investment into $10,000 to $40,000.
Plus, I'll even show you exactly how to do it in real-time... starting with my first pick.
Based on what my system is spotting, I think we have the potential for a massive winner on our hands.
To get all the details, including my first pick, go here now.
The post The Best Sector to Play When the Markets are Volatile appeared first on Power Profit Trades.
About the Author
Tom Gentile, options trading specialist for Money Map Press, is widely known as America's No. 1 Pattern Trader thanks to his nearly 30 years of experience spotting lucrative patterns in options trading. Tom has taught over 300,000 traders his option trading secrets in a variety of settings, including seminars and workshops. He's also a bestselling author of eight books and training courses.