Mortgage Delinquency Rates Increase & 3X ETFs

 

Delinquency rates in Single Family Residential Mortgages and other Consumer Loans began to climb through the later half of 2016 and early 2017.  The timing of this delinquency rate increase coincided almost identically with the Fed increases in their Funds Rate.  Additionally, commercial loan origination stalled for the first time since 2008-2011 (prior to that was a stall in 2000).

 

As you’ve been likely been following our daily video market analysis, you’ll know that we believe the market is still in a bullish trend and that we expect this upward price action to continue for a while.

 

These early warning signs that the Fed rate raises may be pushing other factors of the US economy should be viewed as just that – early warning signs.  It also means that Financial and Banking stocks may find some downward price pressure over the next few months. And protection assets (Gold/Silver and related ETFs) may see continued upward price movement as cash migrates from traditional financial assets into more protectionist asset classes.

 

Single Family Mortgage Delinquency Rate

The two charts below show the rate of mortgages defaulting. Additionally, real estate asset classes may start to see increased volatility as this segment of the economy struggles and has to deal with delinquencies.  The US Fed is attempting to raise rates enough to allow for more normalized economic functions without disrupting the stability of the global markets.  It is our opinion that these efforts by the US Fed will provide substantial rotation in certain sectors of the US markets that skilled traders will be able to profit handsomely from these moves.

SingleFamilyResidentialDefaultRate

 

 

All Other Consumer Mortgage Delinquency Rate

OtherLoans

 

In particular, 3x ETFs may provide unique opportunities for profits.  Let’s review a few potentials…

 

Throughout all of these charts, I expect you’ll notice a similar setup with regards to Financials, Oil Services and Real Estate.  The Fed easing over the past 6+ years has driven asset prices to near all-time highs (or above all-time highs in some cases) and the recent oil price recovery has driven the oil service industry to near term recent highs.

 

The examples we are illustrating today are all contingent on the US Fed continuing to raise rates, as planned this year, which may put further pressure on these segments of the markets as well as potentially increase delinquency rates for residential, commercial and other consumer loans.  In other words, we are expecting some moderate price rotation in the markets over the next few months and we are poised to take advantage of these moves if and when a setup occurs.

 

3x ETF: FAZ – Financial Sector Bear Fund

FAZ_Daily_Final

3x ETF: DRIP – Oil Services Bear Fund

DRIP_Daily_Final 

 

3x ETF: DRV – Real Estate Bear Fund

DRV_Daily_Final

 

We deploy our specialized Momentum Reversal Method (MRM) trading strategy to identify exactly when to enter and exit our trades and to find appropriate trading opportunities.  The MRM method is unique and proven.  Our clients are able to take advantage of our specialized MRM trading strategy and receive timely and accurate trading signals from our web site, ActiveTradingPartners.com.  Many of our recent trades have resulted in tremendous gains for our clients.

 

We want to alert you to the large potential price rotation we are expecting in the immediate future and to alert you to the unique opportunities this type of price rotation will present.  Remember, well over 2 months ago we warned of a VIX SPIKE that was likely between March 15th and April 24th of this year.

 

Take a quick look at the VIX Daily chart to see our prediction

vix

We urge you to consider this information in your trading decisions as well as consider using our stock and 3x ETF trade alert service to further your trading success.  Again, the trading opportunities we are presenting today are not trading signals.  We are waiting for our MRM strategy to issue the trade trigger, then all our clients will be alerted to the signals.

 

Chris Vermeulen
www.TheGoldAndOilGuy.com – Daily Market Forecast Video & ETFs
www.ActiveTradingPartners.com – Stock & 3x ETFs

Economy Contracting but Expect Higher Stock Prices

The United States is the world’s largest and most diversified economy! It is currently suffering through a protracted period of slow growth which has held down job creation and labor market participation.  The Pew Research Center reported, in late 2015, that a mere 19% of Americans trust the government either always or most of the time.

The FED must print more money in order to keep the party going forward.

The bottom line is that this current bull market has been driven mostly by corporations which are buying back their shares, over the years. Individual investors have increasingly been moving out of equity mutual funds and into equity ETF’s.

ec3

 

The Congressional Budget Office (CBO) reported that in fiscal year 2016, the federal budget deficit increased in relation to the GDP, for the first time since 2009. The CBO projects that over the next decade, budget deficits will follow an upward trajectory. The spending costs for retirement and health care programs targeted towards senior citizens, and rising interest payments on the government’s debt will be the root drivers. There will be only a modest growth in revenue collections. This will drive up public debt to its’ highest level of gross domestic product (GDP) since shortly after World War II ended.

The Congressional Budget Office stated that the nation’s public debt will reach 145 percent of gross domestic product by 2047

 

ec5

 

 

Conclusion:

The BULLISH Trend in the stock markets is not reversing in the near future.

The stock market is on an upward trajectory.  Are you wondering what you should do next?

Do you want to gain the edge that you need in order to beat the markets an profit during both rising and falling prices?

Take advantage of my insight and expertise as I can help you to grow your trading account. Tune in every morning for my video analysis and market forecasts at TheGoldAndOilGuy.com on all ‘asset classes’ and new ETF trade opportunities.

I always take half off of the table, on all positions, to lock in quick solid gains and then ride out the other half for much higher returns!  I manage my risk while keeping profits!

Chris Vermeulen
www.TheGoldAndOilGuy.com

“Sell in May” Could Happen in April?

The Fake Recovery May Be Ending

The “real”  Atlanta Fed’s reading of Q1 GDP   went off a cliff to less than 1%:

No one has the slightest idea of what is happening as insane levels of debt distort the model’s which economists use to forecast the future economic trends. From here on out, there will be unpleasant surprises all the way around. According to shadow stats, the GDP is in contraction at the rate of -2%.

april1

 

The New Normal & Disconnect:

The FED and other agencies have taken on new responsibilities for managing systemic risk since the financial crisis of 2007.

What grade have they earned?  The impact of implemented low-interest rates for savers has made them poorer. All pension plans, college endowments, and state retirement plans have been diminished and devastated by low-interest rates. Savers have suffered and will continue to do so because of ‘financial repression’.

Furthermore, because low-interest rates make savers poorer, the contracting economy has limped along with anemic growth rates. Low-interest rates have had a negative impact for almost everyone.

 

Preparing For The Big Crunch!

The FED will respond with even more aggressive money printing — which will then cause the entire monetary system to implode some day.  Money is not wealth, but rather it is merely a claim on wealth.  Debt is a claim on future money.  The only way to have faith in our current monetary policies is if one believes that we can grow our economy and GDP out of this massive debt that we have created.  The U.S. is already insolvent, meaning liabilities exceed assets.  The U.S. has been spending, far beyond its’ means, for multiple decades while amassing tremendous amounts of public debt, private debt and entitlement liabilities.

 

The Austrian economist Ludwig von Mises said, “There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.”

 

U.S. economic growth began slowing down due to its’ acceleration of ‘too much debt’. Instead of allowing natural market forces to clear out the excessive debts, the Federal Reserve chose to go into overdrive to ‘remedy’ the problem. Its’ remedy? Drive interest rates to 0% to reduce the service burden of those debts and print trillions of fresh dollars which, in turn, would fund new borrowing.

Of course, no true ‘solution’ for resolving debt involves piling up even more of it.  The only path that history has shown that works involves fiscal austerity and reducing debt. The only real solution is “a voluntary abandonment of the credit expansion”.  

The only possible solution for recovery, today, is if the economy suddenly returns to an extremely rapid economic growth over an extended period of time.  If during such a period of rapid growth does occur, we must use that windfall to pay down the outstanding debts!  The intent of the FED treading into the never-before-tried ZIRP and NIRP waters was to ignite more borrowing, not more spending!

Pension plans have been ultimately decimated by these monetary policies!

Pension funds across the U.S. are desperate to overcome low interest rates and return to the time when future retirees were entitled to and could receive their full benefits. Pension funds which so many depend upon for their retirement security will lose trillions of dollars which will result in the depletion of receiving their benefits!

 

The chart below reflects the last two times that industrial and commercial loan contracts crashed which were in 1999 and 2007!{25 year chart} of all American Bank Commercial and Industrial Loans.The last 2 times loans contracted and broke down was 1999 & 2007

April2

Making Real Profits!

Want to gain the edge you need to beat the markets? Or Better yet, profit during the next market correction through the use of Inverse Exchange Traded Funds?

Take advantage of my insight and expertise as I can help you grow your trading account. Tune in every morning for my video analysis and market forecasts at TheGoldAndOilGuy.com on all ‘asset classes’ and new ETF trade opportunities.

I am currently in a gold related trade. The last gold trade that I provided, returned a trade with NUGT resulting in an 112% Profit From Dec – Feb.

We use a combination of traditional technical analytical tools, Elliot Wave Counts and investor sentiment! This makes for Killer Trades with oversized Profits!

We always take half off of the table on all positions to lock in quick solid gains and then we ride the other half for much higher returns!  We reduce our risk while keeping our gains!

It looks as though we are a couple of days away from the next major trade setup which could last several months with the potential for a 51-55% return. Be sure to keep informed by reading my newsletters and get my stock trades and leveraged ETF trades at www.ActiveTradingPartners.com

Is This A Sign of a Market Top or Buying Opportunity?

The Japanese and Swiss Central Banks have turned themselves into one of its market’s biggest “investors”. The Swiss National Bank is a huge holder of U.S. blue chip stocks like Apple and Microsoft. The FED has been “elevating” the U.S. stock market, indirectly, by buying bonds!

 
If the stock market crashes, the FED will bail out investors like Japan and Switzerland in the next market downturn? – http://libertystreeteconomics.newyorkfed.org/2012/07/the-puzzling-pre-fomc-announcement-drift.html.

BOJ_ETF SNB_USEquityHolding

The FED could lift large cap stocks possibly pushing prices to levels that history would consider totally insane!
Currently the SPX is experiencing a period of consolidation. Do NOT short this market! The momentum oscillators are now RESETTING for the next move up!

 
These oscillators are extremely helpful in trending markets. According to Traders Almanac, the month of April is the best month for the Dow Jones with an average gain of 1.9% since 1950, p. 38.

 

USBroadMarketForecast

Courtesy of TMTF service

Market bubbles are rarer than you think and very hard to recognize until it is too late. Many economists have long debated whether bubbles can be identified and then stopped, before they burst and cause widespread damage like the crisis of 2007-2008.

 
Investors are always questioning if it possible to avoid being pulled into a bubble at the top. All investors can avoid declines like the 80% drop experienced by the NASDAQ 100 index of technology stocks between March 2000 and August 2002 just by viewing my daily morning video reports, for by following the direction of the momentum stock trades over at ATP.

 

The latest Sentiment Surveys disclosed:

Small investors tend to trade on emotions rather than logic or expertise which is why they are considered the dumb money. Finally succumbing to the lure of apparently easy money and pouring their savings into the stock market. This dumb money flowed into exchange traded funds (ETFs) which offers exposure to all sectors and broad market indexes. BlackRock Inc. reports Investors poured $62.9 billion into exchange-traded funds in February of 2017: (https://www.wsj.com/articles/etfs-race-to-fastest-yearly-start-ever-based-on-inflows-blackrock-data-show-1488499476).

 
The NAAIM survey, (http://www.naaim.org/programs/naaim-exposure-index/), of active investment managers, is showing the least exposure to stocks in months. Active Managers, which is considered the smart money have been stepping cutting back their exposure from “Risk On”

 
The four other times they pulled back after spending months heavily exposed to stocks, the SPX took off to the upside. They did maintain high exposure to stocks since November of 2016, which was the right move. Now, they have started to reduce their positions and are below 80% net exposure for the first time in months. Investment manager exposure is dipping after months of being extremely exposed.

 
The stock market tends to swing from one extreme to the opposite extreme as human emotions swing from greed to fear and back again! The CNN Money Fear & Greed Index indicates FEAR at 30 on Friday March 24th, 2017, signaling its lowest level of investor confidence since November of 2016 before the election:(http://money.cnn.com/data/fear-and-greed/). Our metrics are reflecting that optimism is declining after recording extreme optimism, but has reached neutral territory.

 
The total put/call ratio is the volume of puts divided by the volume of calls traded on individual equities on the Chicago Board Options Exchange. The chart below indicates that the “sweet spots” to BUY is when this indicator reaches EXCESSIVE PESSIMISM which are marketed by the red circles.

EquityPutCallRatio

Individual investors feel comfortable with the rate hike by the FEDS as positive. The speed and the extent of the post-election rally and the prevailing level of valuations remain a point of concern The potential impact that President Trump could have on the domestic and global economy continues to cause uncertainty among some investors, while encouraging the majority.

 

How to Play Wall Street for Profits

We use a combination of traditional technical analysis tools, Elliot Wave Counts and investor sentiment! This makes for Killer Trades with oversized Profits!

 
There are ways to take advantage of these fast-moving markets to earn a steady income or grow your trading account. That is through our Momentum Reversal Method (MRM). The key tenants of my trading are waiting for the right trigger/event and getting in early. We find this is one of the most difficult aspects for traders to understand and master, and why we do best and share with followers of our trade alerts.

Recent Trading Results Include:
UGAZ 74%
ERX 7.7%
NUGT 112%
URA 2.7%

Our most current active trades are in FOLD and CARB which both are ready to soar with the next market upswing!

Get Trade Alerts in Real-Time at: www.ActiveTradingPartners.com

John Winston & Chris Vermeulen

Gold, Short and Long-Term Price Projections

Critical Fibonacci Extensions May Mark End Of Trump Rally

Our research is showing critical Fibonacci extensions are in place for US Major Markets that may be foretelling of a massive market correction.  Part of our research is to search for and study events and resources that are a bit abstract.  One component of this research is to identify critical price levels and early warning triggers from abstract price data.  The major US indexes and most individual all showing price advanced over the past years and many are showing extended price rallies since the US Presidential election on November 8, 2017.  Yet, none are as foretelling as our “US Custom Index”.

 

The INDU is showing a price advance equal to a 1.8765 Fibonacci expansion.

The SPX500 is showing a price advance equal to a 1.9165% Fibonacci expansion.

 

What is the relevance of these expansions?  Many Fibonacci retracements and expansions fail near a n.875 ~ n.9231.  Now, you may be asking, “why should I be concerned about failure at these levels?”.  The answer is simple, one of the most important components of Fibonacci analysis is an abstract theory regarding “Failure to Succeed or Failure to Fail”.  Another very important component of Fibonacci theory is that “price is always attempting to establish new highs or lows”.  How this relates to our understand of what to expect in the future depends on expectations that are presented by understanding Fibonacci ratios, price projections and simple key components of the Fibonacci theory.

 

Without going into too much detail, “Failure to Succeed” is the failure to match or meet expected price objectives or actions.  “Failure to Fail” is the ability of price/trends to exceed expectations or objectives and extend beyond expected target levels.  Again, price is always attempting to establish new highs or lows within Fibonacci theory.  Therefore, success or failure at critical levels means price should attempt to either reverse or extend.

 

As you are probably well aware, we have been expecting an increase in the VIX to coincide with extensive major market volatility between March 15th and April 24th. So far, the VIX has jumped form the March 15th low over 41%. You can read more about this by reviewing THE VIX ARTICLE.  Our analysis, originated in late January, and warns of an extreme potential for massive price movements across the globe.  This all depends of a number of factors correlating to prompt these expected swings, but so far, everything we predicted is starting to happen.

 

VIX Chart

VIX_Weekly

This next chart of the NAS100 Index shows a number of key components at play.  First, the 2.618% Fibonacci expansion level is currently providing strong resistance.  Additionally, it shows a series of price cycle bottoms that originate from 2014 & 2015 price lows.  Lastly, it shows current price highs are also lining up on a 1.50% Fibonacci Expansion from the recent price rotation illustrated by the last red rectangle on the chart.  One should pay attention that the two red rectangles are copies of one another and illustrate that price rotation has been in nearly identical volatility ranges since the end of 2014.  Only after the US Presidential election was price able to breakout of these ranges and extend to current levels.

 

Further, the arcing analysis on the chart represents Fibonacci vibrational price analysis.  It is designed to show us where and when price may break out of or into new trends/channels.  As you can see, the arcs align relatively well with price activity and price has recently extended beyond the most recent arc level on the right edge of the chart.

 

Combine all of this analysis into a simple message, one would likely resolve the following : Current Fibonacci price extensions are providing clear resistance.  Price cycles state we should establish a new price low near April 24th and price has recently extended beyond a vibrational cycle that coincides with Fibonacci resistance.  Historical price ranges show us that June 5th, 2017 may begin a new price trend cycle

 

NAS100 Chart

NAS100_W_SM

The “key” in terms of our analysis and understanding of the current market setup is seen on our US Custom Index.  This custom index is made up of key components of the US Economy (US Retail, Real Estate, Consumer Finance, Consumer Discretionary and the SPY).  The reason we have selected these for our index is we believe they relate a broad scope of “early movers” as related to the overall health of the US economy.  In other words, this custom index should relate early strength or weakness in the relation to general US economic activities rather well.

 

This chart is showing a number of key components, but most important is the YELLOW line near the top which represents a near EXACT 1.272% expansion of price from recent highs set in 2007 (2.272 % expansions from the lows in 2009).  The n.272 Fibonacci expansion levels, like most other Fibonacci expansion levels prompt one of two possible outcomes; a.  Price congestion followed by further advance, or b. a moderately deep price retracement (often greater than 25% of the recent move).

 

This chart, as we stated earlier, is the “key to understand the potential of and expectations of all of this analysis.  With the VIX expected to “spike” between now and April 24th, the NAS100 chart showing massive expansion (2.618) that is correlating with recent 1.50% resistance and key vibrational resistance and, this Custom Index, pivoting off of critical 1.272% Fib Expansion, near the beginning of our expected VIX expansion, near Fibonacci Vibrational levels on April 10th and near the lower range of a multi-year historical Standard Deviation channel, we are preparing for an immediate potential price rotation (correlating with a spike in the VIX) that may drive equity prices down to near 2016 lows (a drop of potentially 15~20%).

 

Custom Index Chart

US_Custom_Index_W_SM

Our analysis is showing that many key elements of cross market analysis are aligning to warn that we may see a moderate term end to the “Trump rally” and a relatively deep retracement that could shake the markets.  We are not predicting a 2009 style crash.  We are, although, expecting healthy market rotation that will setup additional opportunities for traders to identify profitable trades.

 

At this point in time, we wanted all of our readers to be aware of the multiple correlations that support our analysis and the fact that volatility is set to start rising.  Keeping this in mind, we are positioning ourselves and our clients to take advantage of these expected moves and we will continue to monitor the markets price action to take advantage of opportunities as they form.  If you want know more of our unique Momentum Reversal Method (MRM) and our trade setups, please visit www.ActiveTradingPartners.com to learn more.

VIX Cycles Set To Explode March/April 2017 – Part II

Back in early February 2017, we posted an article to all our members about how our analysis showed a very strong potential for larger price swings with the potential for a massive explosion in the VIX indicator based on a price cycle pattern we had been studying.  Many of you may remember this article, if not Click Here to review the original.

 

As of right now, only 10 days into our proposed “VIX Spike Window” (from March 12th to April 15th), we thought it would be a good idea to review some of our analysis before we enter the heart of the VIX expansion window (March 25th to April 8th).

 

Vix Spike Calendar

2017-calendar-1468440983V9p

As you may recall, we expect a, roughly, five month cycle of expanding VIX volatility to continue within the time-frames mentioned above.  The peak of this volatility will likely happen between March 25th and April 8th – what we are calling the “heart of the window”.  This will likely be a very tumultuous and volatile period where massive rotations in price could occur.  Additionally, new or reversal trends would also be key components of this type of expanded volatility.  This means active traders have an opportunity to generate some fantastic returns from these moves.

 

Based on my original analysis from early February, lets summarize how things are expected to play out over the next few weeks for a few key symbols.

perf-table

 

As you review our earlier analysis, pay attention to the details we laid out for each symbol.  We expected “key top” levels to be reached at the time of the original article followed by price rotation/retracements, followed by more price trending.  Pay special attention to the details we discussed for each of these symbols in the first article.

 

DIA pulled back near 6% (Min Volatility target reached) from recent highs and we are expecting more volatility before any future moves

 

QQQ pulled back 2.6% and we are expecting a deeper pullback as the volatility explodes in the near future.

 

XOI has fallen an additional 4.33% and we are expecting this move to continue to near $1075 (an additional -$81.50) before attempting to find a bottom.

 

GOLD retraced just over 5% from near $1265 and is currently in a solid uptrend.  Our current projection is for a move above $1310, followed by a pullback below $1280 (where we want to try to buy), followed by further upside moves to above $1350.

 

SILVER has retraced nearly 9% (Min Volatility Target Reached) from recent highs and is setting up potential move back above $18.00 or higher.

 

 

DIA Chart DIA_FU

Gold Chart GC_FU

Silver Chart SI_FU

At this point, we should be very cautious to consider only highly probable trading signals because the expected volatility in the global markets should become more violent and unpredictable.  This makes for great short term Momentum Reversal trades though.

 

Our recent Momentum Reversal Trades have shown fantastic results like UGAZ 74% and NUGT 112%.  The possibility of seeing exploding volatility over the next few weeks in combination with massive potential rotation in prices will allow us to find some incredible opportunities for followers of our work and trades.

 

Remember, the Heart of the volatility window should be from  March 25, 2017 to April 8, 2017.  You can take advantage of this by follow us at: www.ActiveTradingPartners.com

 

Chris Vermeulen

Credit Suisse Has Message for Their Wealthy Clients​​​​​​​

Mr. Burkhard Varnholt, Deputy Chief Investment Officer of Credit Suisse, said:

Whenever. . .”

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