Japan GDP Jolts Markets To Start The Week

We told you so!  

Last Wednesday, right in our morning post, I told you how you could benefit from SUBSCRIBING to our newsletter because we would give you great trade ideas like this one, which we featured for free in that morning’s post:

I also mentioned shorting EWJ in the morning post but, for our Live Chat Members, I sent out a Top Trade Alert specifically on the Jan $12 puts at 0.52 to go along with our call to short /NKD (Nikkei Futures) at 17,500 at 8:22 am (also in the morning post) and by 11pm last night we were close enough, at 17,490 and, already this morning, we’re back at 17,100 – for a $1,950 per contract gain – all overnight and all “according to plan“.  

As you can see from the chart above, we had a fantastic chance to reload on the Nikkei futures (up over $2,500 per contract at the moment) as well as the EWJ puts, which should be up about 50% today – but we think we can do better than that as Japan’s GDP was even worse than we thought it was going to be – declining 1.6% in Q3 and officially putting the economy back in Recession.

“None of the 18 economists surveyed by The Wall Street Journal had forecast a contraction; the median forecast was for a 2.25% expansion.” – That’s why we were able to make so much money betting on it – we’re smarter than the WSJ’s 18 economorons!  

Another trade idea we gave away FOR FREE in Wednesday morning’s post was a TZA hedge, using the Jan $12/16 bull call spread at $1.20 and already on Friday, TZA closed at $13.46, putting the spread $1.46 in the money, which is up 21.6% in the money if TZA closes there – not bad for a 2-day hedge…  Of course the potential for the hedge, if the Russell keeps falling, is $4, a 233% gain, which is what makes it such a good hedge for a bullish portfolio.  As I said on Wednesday: