QQQ

Nasdaq QQQ Invesco ETF

Options

How to Use Options as a Trading "Power Tool"

When I was in seventh grade we had a big science project. I decided I wanted to do a mouse maze to see if mice could be trained to navigate a real-life maze with increasing speed, given various rewards, etc.

Building the maze required cutting a lot of pieces of wood to fairly exact specifications. My dad taught me how to measure accurately, mark the wood, and make a clean cut with a hand saw.

After an hour, I had about four or five pieces of the maze done – about 35 to go…

My dad, comfortable with my level of care in using the hand saw, showed me the hand-held electric reciprocating saw.

Used correctly, I could cut 10 times as many boards in the same amount.

The problem was that used carelessly, it could make a bad cut or, worse yet, could endanger a whole finger…

So dad took great care in showing me the safety rules and procedures for using the power saw. After significant training and under his watchful eye, I transitioned to using the much more powerful tool, with fantastic results.

Despite the added risk, dad showed me how to use a power tool to get the job done fast and safely.

I'd like to reintroduce you to one of our most potent trading power tools today...

Trading Strategies

The "Shutdown Trade" I Didn't Give FOX Business

Earlier this week I told Stuart Varney of FOX Business Network's "Varney & Co." about the actual results of what has happened after every government shutdown since 1981.

What I didn't tell him was how to profit from this historical trend.

For several weeks now, I've been promising a special options trade just for 10-Minute Millionaires – a little taste of what my elite subscribers get every week in Stealth Profits Trader. And the recent shutdown is the perfect opportunity to deliver on that promise.

Today, I'll give you a few of the details of the market's reaction after every shutdown – and then we'll look at a trade that puts those probabilities on our side.

This is a short-term trade – because the "shutdown effect" historically takes just 10 days to start working.

And, like most of the options trades I recommend, it has triple-digit potential.

Here's what you need to know - and how to profit...

Trading Strategies

Now That the LAMPP Is Finally Red, Here's How to Make Money

As I reported earlier this week, the short-term LAMPP has turned red. It's only by a hair, but it did cross the line. This is no surprise to us. I have been reporting to you every week that we were getting closer and that a signal change was imminent.

I have been warning you that Treasury supply would soon increase radically. As expected, the federal government is now moving to raise the cash it needs to pay back the funds it raided internally under the debt ceiling and to rebuild cash. The Treasury will issue net new debt of $54 billion over the next few days.

At the same time, buyers of that new debt will no longer have the Fed's help in financing those purchases. In October, the Fed will start draining cash from the system, instead of adding $25-$30 billion per month to primary dealer accounts, as it has been doing lately.

The long-term LAMPP signal should turn red within the next month or so.

What that means is that the market should now begin its turn to the downside… the risk-reward equation has tipped to the sell side… and we will start seeing more and more opportunities to hop aboard the short side for solid profits.

Since you've hopefully been building a larger cash position over the past few weeks, you should be able to make one or more speculative trades to capitalize on the signal change. (Of course, timing these trades will require technical analysis, which I cover over at The Wall Street Examiner Pro Trader.)

But first things first - don't panic...