The last day of 2nd quarter for the US markets has been bearish. Stock Traders Almanac gives Dow a 68% chance of being down. Since 2000, Dow has been down 57% of times. However, the average return is not much. We also think that the last day of the 2nd quarter is not a trade-able event.
In contrast, the first day of July has markedly more bullish tendency. Since 1990, Dow has been up 79% of times on the first day of July and S&P 500 83% of times. NASDAQ and Russell 2000 have been up 71% of times during this time.
We have applied our proprietary strategy for entry and exit and results are phenomenal. Since 2000, using 1X and 2X index ETFs, our strategy produced 56 trades and 70% of them were winners. The average gain is 0.5% for one day holding period giving an annualized return of 89%.
| Seq. | ETF | # of Trades | Win % | Avg. Return | Avg. Days | Annualized |
| 1 | DIA/DDM | 14 | 71% | 0.6% | 1 | 112% |
| 2 | SPY/SSO | 14 | 79% | 0.7% | 1 | 124% |
| 3 | QQQ/QLD | 14 | 64% | 0.2% | 1 | 28% |
| 4 | IWM/UWM | 14 | 64% | 0.5% | 1 | 98% |
Our strategy calls for going long on market close for:
- ProShares Ultra Dow 30 (DDM)
- ProShares Ultra S&P 500 (SSO)
- ProShares Ultra QQQ (QLD)
- ProShares Ultra Russell 2000 (UWM)
We will exit on the close of July 1st.
