In case you’ve missed the news, President Trump’s trade wars have officially begun.
After months of circulating rumors and political rhetoric, a 25% levy on $34 billion of Chinese goods entering the U.S. took effect just after midnight.
And neither side is showing any signs of backing down, as China retaliated immediately and slapped U.S. shipments with “retaliatory” tariffs.
Now, as you might guess, this could cause quite the disruption in an already volatile and uncertain market – especially when you don’t know when the next set of “retaliatory” tariffs might hit.
So here’s everything you need to know to survive even the worst of the trade wars…
A New Way to Trade
Over the last few weeks, I’ve sent you trading strategies to help you navigate any kind of market.
But today, I want to focus on something a little different: options.
Now, I know we just spoke about the opinions surrounding them: stay away from options, options are too big of a risk, and more – but the truth is, options are the best way to make money in any kind of market. But there’s a right and wrong way to trade these lucrative opportunities.
And it starts with this one, simple rule: plan your trade and trade your plan.
This sounds easy enough – and it is.
But there’s a little more to managing your trades than you might initially think…
Trade management involves using price and time targets to maximize your profits and minimize your losses. And the best way to do that is to establish these target first.
Your price target is the price you need the stock, exchange traded fund (ETF), commodity, or whatever you’re trading to hit in order to capture profits. Your time target is the time frame in which you need to hit your price target. You can set both of these targets easily by looking at a stock’s past price moves and patterns and eyeballing the time frames in which the price moves you need to happen.
When you’ve got your plan in place and stick to your guns, you’ve can feel confident about what you’re doing and can set yourself up to make money no matter if the markets go up, down, or sideways. It also allows you to remove the emotion from trading and investing that can potentially sabotage your profit opportunities. It gives you control of the markets instead of leaving you at their mercy.
You shouldn’t change the way you trade regardless of the market temperature. So shut out the fear of missing out, the talking heads, the flashing red headlines, and the constant dialogue about the “next big market crash” – and follow your rules and strategies.
The profits will come quicker than you can imagine.
But that’s not the only little trick to success.
It’s easy to know your rules once you get into a trade – but knowing which position is best to take can be harder.
Don’t worry – I’ve got you covered…
To start, you need to pre-determine your maximum risk level.
Next, you need to figure out how much capital you’re comfortable risking.
Once you nail that down, the next thing you need to do is set a stop-loss approach.
A stop loss is a tool that lets you automatically get out of a trade if it starts to losing too much in value. In other words, it lets you cut your losses short – which is always a nice thing to fall back on.
Once you’ve got your stop loss, you’ll want to determine your position sizing.
This simply means deciding ahead of time how many shares or option contracts you can take on for the trade.
And lastly… adapt your trades to your account size.
But if you have a huge trading account – with, say, $250,000 allocated to stock and option trading with the same 2% ($5,000) risk per trade rule – consider trading cheaper stocks, or using options strategies instead.
And when you allocate only $500 to each of these plays, your risk is minimal…
Even better, when you are following a strategy that hands you two chances every week to potentially double your money in 30 days, you have an incredibly high-probability to profit.
You see, by using my patent-pending money calendar, I show my readers only the best ways to make money from patterns that have repeated 90%-100% of the time… And it’s exactly how we’ve already hit 25 triple-digit closeouts this year. Now, I’ve got two moves lined up for Monday that could each hand you 100% or more… And all the details on this opportunity are right here.
To your continued success…
Tom Gentile
America’s #1 Pattern Trader
