ProShares UltraShort Technology ETF (NYSE: REW) – This inverse ETF, which seeks to return twice the inverse of the daily performance of the Dow Jones U.S. Technology Index, has been in a bull channel since early May. The top of the channel is at just over $26 with support at around $21.
Yesterday’s late announcement by Apple (NASDAQ: AAPL) of outstanding earnings and revenues could result in a sharp day down for REW and an opportunity to buy it at an attractive price.
See Sam Collins’ Daily Market Outlook here.
But be warned that this is a very volatile ETF and is recommended only for day traders. It has greater risk than an ordinary ETF, and so investors should place stop-loss orders when investing in it.
And finally the SEC has determined that “ultra funds” are not good long-term investments and that they are most appropriate for short-term trades.
The margin requirement for most leveraged ETFs is 100%.
Related Articles:
- Your Next Opportunity to Short the Market
- Understanding Leveraged and Short ETFs
- What’s Your ETF IQ?
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