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Banking & Finance Expected To Get Crushed

Big news out today on CNBC about Gilead drug cured all 125 people from serious COVID-19 conditions within 5 days, This is amazing to hear, stocks are popping today up 3-5% which is to be expected for this type of news but the damage to the financial markets has already been done.

But early data recently published suggests the Banking and Finance sector may continue to get crushed under a massive weight of real losses and exposure to risk in the Derivatives Markets.  As with the 2008-09 Credit Crisis, Derivatives losses extended compound risk factors by 10x to 20x or more for in some instances.  We believe the banking and finance sector may be setting up for a massive implosion if global derivatives implode as leveraged accounts collapse.

Two very interesting news articles that may assist readers in understanding the current Financial market contagion event are:

Bank Earnings Armageddon by TheInstitutionalRiskAnalyst.com

Xi fears Japan-led manufacturing exodus from China by Asia.Nikkei.com

The Chinese/Asian economy is built upon the premise that global demand will continue without interruption over the next many decades.  Additionally, China and Asia have leveraged capital systems and financial functions by deploying a very shadowy measure of lending and banking functions.  We’ve all heard the stories of how collateral-based loans were offered many times over as stock in Copper or other raw materials were simply moved from one location to another to secure loans on the same material.

As with any great Ponzi scheme – it all starts to collapse when investors decide they don’t want to play games any longer.

FEDERAL RESERVE – RETAIL & FOOD SERVICES SALES

These recent St. Louis Federal Reserve charts paint a fairly clear picture that retail and food services sales have collapsed to below levels of 4+ years ago – and this is just getting started.

FEDERAL RESERVE – BORROWER DELINQUENCY RATE

This next chart shows that sub-prime borrower delinquency rates have already peaked above both the 2000 and 2008-09 peak levels.  The current virus event collapse is a completely different beast of destruction than what we’ve experienced before.

This is why we believe the Banking and Financial sectors are about to get hammered over the next 6+ months as a massive credit and debt deleveraging process continues to take place.  Consumers recently displaced from the workforce will suddenly find themselves without the ability to pay their bills and credit card balances.  This is not just happening in the US or select areas – this is happening throughout the world right now.  Banking and Finance are staring into a black hole in terms of just how big and destructive the displacement of consumer jobs/earnings capacity really is.

We believe the recent recovery in the US stock market was a reactionary event prompted by the US Fed stepping in to “stick their finger in the dike” as an effort to thwart the downside price collapse.  When the reality of the situation really begins to settle in about 60 days, banks and other financial institutions are going to have a difficult time explaining losses and exposure to derivatives risks that were clearly evident in March and April 2020.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

WEEKLY CHART – NASDAQ REGIONAL BANKING INDEX

This first Weekly chart of the NASDAQ Regional Banking Index shows just how destructive the initial downside price move has been.  Even though the US Fed stepped in with a massive $5+ trillion rescue plan, the recovery in this sector has been minor.  We believe that is because most investors understand the true risks in this sector are likely in the hundreds of trillions range with derivatives and leveraged positions.

UCC WEEKLY CHART – CONSUMER SERVICES SECTOR

This UCC Weekly chart shows a bit more of a recovery after the US Fed stepped in to save the day.  Yet, we fully believe a deeper price low is likely to set up as the full extent of total newly unemployed put additional strains on expectations.  Consumers without income can suddenly collapse multiple trillions in credit/debt over a very short period of time.

XLF FINANCIAL SECTOR WEEKLY CHART

The XLF Financial Sector Weekly chart paints a very clear picture of the downside risks current in play.  After a massive initial collapse, a brief sideways recovery has taken place.  Yet the true risk for this sector takes place over the next 24+ months as these newly displaced workers attempt to manage with little or no income and attempt to satisfy debt levels that were acquired expecting pre-2020 income expectations.  New cars, new homes, new credit card debt, new everything purchased on credit has suddenly become the beast that destroys the financial/banking sector.

CONCLUDING THOUGHTS:

Our researchers believe the true scope of this crisis won’t be known for at least another 30 to 60+ days.  The closer we get to the end of Q2, the more likely we are to see real data reflecting real risks in the Banking and Financial sectors.

Until we get a more accurate understanding of the risks, we feel it is much safer to assume the worst-case scenario going forward.  There is simply no way to paint a positive picture when people throughout the globe are losing their jobs, incomes, and all sense of normalcy.  The reality is that this disruption in the global banking and financial sector is certainly going to be a big one that could last many months or years and if you read this article or watch the video you will understand the magnitude of this market top that looks to be forming.

I have to toot my own horn here a little because subscribers and I had our trading accounts close at a new high watermark for our accounts. We not only exited the equities market as it started to roll over, but we profited from the sell-off in a very controlled way, and yesterday we locked in more profits with our SPY ETF trade on this bounce.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

The Next Big Breakout Trade: Large Cap Gold Stocks

This technical analysis video I put together has a lot of great trading opportunities in it while providing a lot of educational content to help you see the markets and trade in a way that will reduce your risk/exposure when needed.

I use my BAN trading strategy which is I focus on the Best Asset Now and only trade the sector, index, or commodity that has the least risk and most upside potential at the current moment.

I won’t lie, im super picky and conservative so trades are few and far between but as a swing trader, or any trader for that matter, the quality of a trade alert trumps quantity. Watch this video below and see what I provide my subscribers every morning before the opening bell. If you like it, then join us and become a technical trader today!

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

I have to toot my own horn here a little because subscribers and I had our trading accounts close at a new high watermark for our accounts. We not only exited the equities market as it started to roll over, but we profited from the sell-off in a very controlled way, and yesterday we locked in more profits with our SPY ETF trade on this bounce.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

If Investors Crunched Data This Their Expectations Would Change Dramatically

New economic data being released as earnings start to hit may alter how investors perceive the recent price recovery in the US and global markets.  Many institutional analysts began suggesting “the bottom is in” and recently began to issue stronger forward guidance.  The new data suggests we are seeing an economic contraction that, in some cases, maybe 2x or 3x the contraction that took place in the 2008-09 Credit Crisis.

The US stock markets reacted to this news and earnings data by collapsing over -2% in early trading.  Gold and Silver are both lower as we write this article which would indicate weakness across the broader market.  We continue to believe a deeper price low will set up in the near future with the US and global stock prices attempting to retest recent price lows – possibly falling below these levels.  We believe the collateral damage to consumer engagement, manufacturing, transportation, retail/leisure, real estate and other sectors of the economy is just now starting to become evident.  What the economy may look like near Mid-May is anyone’s guess.

MANUFACTURING OUTPUT INDEX

One of the most interesting data items published recently in the US Manufacturing Output Index which reported at -6.3%.  This is the largest downside (negative) print going back over 20 years.  It is nearly 2x larger than the deepest levels from the 2008-09 Credit Crisis and nearly 6x the levels of the 2001 9/11 terrorist attacks.  This time it really is different.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

Source: https://www.investing.com

NEW YORK EMPIRE STATE MANUFACTURING INDEX

The New York Empire State Manufacturing Index was no different – posting a level at -78.20%.  This massive negative number is nearly 2x the deepest levels printed during the 2008-09 Credit Crisis and clearly illustrates how the COVID-19 virus event has disrupted manufacturing output across the globe.  Depressed manufacturing translates into decreased shipping, decreased supply, decreased demand, and decreased overall economic engagement (employment, support services, taxes, and others).  A number similar to the lows of 2008-09 would be sufficiently terrible.  A number that is 2x below the lowest levels in 2008-09 is absolutely destructive to forward expectations.

Source: https://www.investing.com

NAHB REAL ESTATE INDEX

Real estate is starting to feel the pinch too.  The NAHB Real Estate Index came in at 30.  The only times in history where this level has been reached were September 1990, October 2006, and June 2007.  These areas in history clearly point to an early recession indicator in the markets.  We found it interesting that September 2001 (9/11) didn’t experience any major downside print in the NAHB index.  The lowest level reached after 9/11 was 46 (November 2001).  The current 30 level is shocking.  If history is any indication of what to expect in the future, this real estate index may attempt to set up an extended bottom near or below 15 to 20 over the next 12+ months.

Source: https://www.investing.com

REDBOOK INDEX

Lastly, the Redbook Index – which printed a level of -8.3.  This index of over 9000 retail locations is one of the broadest market indicators of consumer/retail-based activity in the US.  Obviously, with the shutdown taking place within the US and across the globe, we were not expecting any type of fantastic number. Yet our concern is that consumer engagement continues to slowly emerge from the shutdown over the next 12+ months and the collapse in retail may become prolonged

Historically, this is the deepest level printed on the Redbook Index since 2008-09.  We believe the continued shutdown and disruption to traditional manufacturing, supply and retail will continue to present very negative outcomes for global economic measures.  Thus, we believe the risks to the US and global stock market are still very real for skilled traders.

Source: https://www.investing.com

CONCLUDING THOUGHTS:

The US Fed and global central banks are doing everything possible to support a shocked global economy – yet they can’t print enough money to replace the global activity of consumers, manufacturers, and traditional economic functions. They can just attempt to “patch things up” while they wait for consumers and manufacturers to begin operating near-normal levels.

It is very important for skilled traders to understand the bigger economic risks that are at play and to understand the process of price moves within the current market cycle.  I was recently interviewed about my market opinions and stated very clearly how investors could fall into a “suckers rally” trap.  Listen to my talk here.

Be prepared for more downside risks and a potential for a much deeper price bottom over the next 6+ months.  Those individuals/firms suggesting “the bottom is in” are certainly jumping the shark, in our opinion, right now.  It’s a pretty big event to come out right now and tell investors “buy these dips because we believe the US Fed has everything under control”.  Be cautious and use your own skills to wait for a proper bottom setup.

I have to toot my own horn here a little because subscribers and I had our trading accounts close at a new high watermark for our accounts. We not only exited the equities market as it started to roll over, but we profited from the sell-off in a very controlled way, and yesterday we locked in more profits with our SPY ETF trade on this bounce.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

Could This Be a “Suckers” Rally?

Everyone I know who is not involved in the stock market or has little knowledge about it is calling me and asking what stocks, indexes, and commodities to buy because everything is so cheap and dividends are juicy again.

Just look at the market sentiment chart, and price cycles that the stock market goes through, and listen to my talk below while reviewing these to images. It’s not rocket science, but the lack of education on the financial markets coupled with the force of greed to make money and miss out on the next big bull market has everyone getting suckered into this dead-cat bounce, also known as a bear trap, bear market rally.

LISTEN TO MY TALK – CLICK HERE

If you want to see something else really exciting/nerve-wracking/ and real check out this post on the Stock Market Top.

A subscriber to my market video analysis and ETF trading newsletter said it perfectly:

“Always intrigues me how many amateur surfers get to the north shore beaches in Hawaii, take one look at monster waves and conclude it’s way too dangerous. Yet the amateur trader looks at treacherous markets like these and wants to dive right in!!” Richard P.

I have to toot my own horn here a little because subscribers and I had our trading accounts close at a new high watermark for our accounts. We not only exited the equities market as it started to roll over we profited from the sell-off in a very controlled way.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

Downside Opportunities Everywhere – Watch These Symbols

As the global markets enter the Q1 earnings season where a host of new data and expectations will flood the markets over the next 30+ days, skilled traders should put these three symbols on their watch-list over the next few days and weeks.

We’ve been writing about how we believe the downside risks within the US and global stock markets are still very real.  Many industry analysts believe the bottom has set up in the US stock market already – we don’t believe this is the case.  Our Adaptive Fibonacci Price Modeling system continues to suggest a deeper downside move is in the works and we believe this potential retest of recent lows will setup another incredible opportunity for skilled traders.

Recently, we’ve posted a number of research articles to help you understand what is really taking place in the global markets.  The COVID-19 virus has set-off a consumer demand contraction event that will ripple across all sectors of the global economy.  There is no other way to interpret the data right now – if consumers don’t come back into the economy at levels near the late 2019 engagement levels, then the global economy will continue to contract.  Consumers make up over 85% of GDP values.

HERE ARE SOME OF OUR MOST RECENT ARTICLES TO ASSIST YOU…

Now, onto the three symbols setting up an incredible upside opportunity if the global markets rotate lower as our predictive modeling is suggesting…

FAZ – DIREXON INVERSE FINANCIAL SECTOR ETF

The first symbol is FAZ.  This ETF moves higher as the financial sector stocks move lower.  These include banks, financial institutions, and other financial services companies.  The reason we believe FAZ has a potential to move higher is that we believe the lack of consumer engagement in retail, restaurants, leisure shopping and other types of normal spending activities will put incredible pressure on business loans, consumer loans, commercial and residential real estate, business credit lines and many other aspects of the financial sector.  Simply put, it would be foolish to think that some level of default and/or extended risks would not come from any type of consumer disengagement from the economy.  Again, consumers make up over 85% of the total GDP levels.  If we take away even 20% to 30% of these consumers, we could see a dramatic collapse in certain sectors of the economy.

Thus, we believe the Financial sector is poised for another downside price move which will prompt a rise in FAZ from current levels to near $50~$60.  This represents 65% to 85%+ upside potential.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

MZZ – PROSHARES ULTRASHORT MIDCAP 400 ETF.

The MidCap sector is uniquely vulnerable to any economic contraction related to consumer activity.  Many of the Midcap companies are uniquely consumer-based and/or consumer sector related.  Thus, should another market downtrend attempt to retest recent lows or attempt to set up a deeper price bottom, the Midcap 400 ETF may see an incredible upside price move.  Upside price targets are near $29 to $30 – which is 55% to 65% higher than the current price level. Ultimately, any deeper price lows set up because of a deeper price bottom setting up in the US and global markets could push MZZ well above $35.

QID – PROSHARES ULTRASHORT QQQ ETF

The last symbol we believe could see a big upside move related to increased future risk in the US and global markets is QID – the NASDAQ Inverted ETF.  The reason we believe risks in the US and global major markets may bleed over into this ETF is that the NASDAQ has been a major component of US & foreign investment over the past 24+ months.  Global investors continue to believe that technology firms will out-perform the general market – thus, more capital has poured into this sector of the market over the past 20+ months than many other sectors.

This capital influx also creates an opportunity for contrarian traders if the markets fail to recover – as many people believe will happen.  This capital that has recently poured into the NASDAQ may become “at-risk” if another deeper downside price move takes place.  Investors may have hard stops in place and forced selling may take place if the markets attempt to establish a deeper price bottom in the near future.

Conservatively, an upside price move in QID to levels near $27 (45%) is the first Fibonacci target. Further upside target levels near $30.50, $42.50 and $44.25 also exist. Of course, these higher target levels would be the result of a much deeper global market collapse where a deeper bottom in price is established.

CONCLUDING THOUGHTS:

We believe these three symbols present very real opportunities for skilled technical traders.  Wait for the right setup and confirmation before jumping into these trades. If the US and global markets begin to move lower on poor earnings or economic data, jump over to these charts to see how they are reacting to price weakness.  There is a very real opportunity for 20~40+% profits in each of these charts with the right setup in place.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

AI Fibonacci Modeling Predicts $26 As Next Silver Target

Our Adaptive Fibonacci Price Modeling system incorporates an intelligent “Inference Engine” into internal decision-making and future analysis.  This type of “Adaptive Learning” is one of the core elements of Artificial Intelligence – the ability to read inputs, adapting to price structures and setups and infer expected outcomes/results based on a complex decision-making process.  Today, we are alerting you that our Adaptive Fibonacci Price Modeling system is suggesting $26 is the next target level for Silver (which is currently trading near $15.65).

Learning how to interpret the data presented by our Adaptive Fibonacci Price Modeling system is simple – it does the internal analysis automatically and presents future target levels and trigger levels on the charts as lines and blocks.  Trigger levels are set up as both GREEN and RED lines for current Bullish and Bearish Trends.  Each of these trends also has target BLOCKS drawn out into the future representing where the Adaptive Fibonacci system believes the next price target will be located.  These target levels are determined by the Adaptive Learning Inference Engine and represent the best outcome of the true Fibonacci price structure we can deliver.

WEEKLY SILVER CHART

This Weekly Silver chart highlights the incredible +66% upside opportunity setting up based on our research.  Silver continues to underperform compared to Gold and it continues to be overlooked as a safe-haven metal.  Back in September 2019, we authored this article suggesting Silver would become the “Super-Hero” of precious metals.  That research is still very valid today.

This Weekly Silver chart highlights our Adaptive Fibonacci Price Modeling system’s results and clearly shows you the upside price target near $26.  We believe the US and Global stock markets may continue to weaken as earnings and forward guidance continue to rattle investors’ expectations.  This uncertainty will translate into a continued upside price rally in Metals.  Gold will obviously lead the way higher, yet we believe the sleeper metal is Silver.  Once silver clears recent highs near $19.75, be prepared for an incredible parabolic upside move.

DAILY GOLD CHART

The other aspect of this move is that Gold will continue to move higher as well.  The next upside target for gold is $1840, followed by a brief pause in price, then a continued rally to levels near $2000.  If you think the metals rally it sputtering out right now, we urge you to reconsider your thinking.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

WEEKLY GOLD CHART

Precious metals will likely continue to rally higher and higher, eventually entering a parabolic upside price rally, as global concerns reach a peak.  After the US and Global stock markets set up a real price bottom, metals will continue to rally for 8 to 12+ months after that bottom has setup.  Metals are about to become one of the fastest-growing assets on the planet and may not stop until well into 2021 or 2022.

CONCLUDING THOUGHTS:

Do yourself a favor and take a minute to review some of our most recent market research and really prepare for the rally in metals.  That last Weekly Gold chart highlights what we believe will be the initial upside price rally (in YELLOW) and shows how Gold will target $2000, then briefly pause, then attempt another upside move to levels above $2300.  Our real upside price target for the long-term Fibonacci peak in Gold is near $3750 – that should tell you something really important.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

AI Trading System Using Fibonacci Theory Forecasts Future Gold, Silver & Stock prices – Part IV

As we’ve attempted to illustrate the intuitive nature of the Adaptive Fibonacci Price Modeling system we as one of the tools to help us understand the markets and price setups, we now want to more clearly illustrate other components of the current global economic environment.  We want to illustrate just how deep the current price move resonates against historical price norms.

In Part I of this article, we highlighted the Fibonacci system running on the ES (S&P 500) charts.  The point of this example was to show that a new price low had already been established and a recent new price high (the all-time high peak) was now acting as a critical price peak.  This suggests we are in the process of establishing a much deeper price low (bottom) that may come over the next few weeks as price attempts to “revalue” current economic expectations.

In Part II of this article, we highlighted the Fibonacci Price Theory concepts and attempted to teach you how to identify major and minor Fibonacci price pivot points.  This was done to help you understand what we are attempting to share with you and to help you learn to use these techniques in the future.  The conclusion of that, Part II, shared our expectations that a new, deeper low, would likely set up in the ES and NQ markets as price attempts to establish a future bottom setup.

In Part III of this article, we shared with you the NQ (Nasdaq) Fibonacci price analysis which was similar to the ES charts.  We are attempting to share with you the reality that price will setup intermediate high and low price pivots over time.  But we are really trying to explain how the major price pivots have now set up as a massive warning that a deeper low may be targeted as long as price fails to recover to levels near the all-time highs.  As “obvious” as that may seem to you now, many traders are already entering the markets expecting a recovery similar to May 2018 or January 2019 to begin.  We urge you to reconsider the scope of this disruption of the global economy.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

WEEKLY CHART OF OUR CUSTOM SMART CASH INDEX

The first chart we want to share with you is a Weekly chart of our Custom Smart Cash Index.  This chart clearly illustrates just how destructive the recent collapse in the global economy has been.  Previous downside price rotations (Feb 2018 & October~December 2018) prompted downside price moves that stayed within the upward sloping price channel established from the 2015~2016 price range setup.

We believe this new downside price cycle will establish a new support channel for future price growth that may include a transition away from traditional economic measures.  Essentially, a “new normal” related to debt and economic expectations.

We believe this COVID-19 virus event may be unwinding a large portion of capital appreciation that originated back in 2000~2002 – after the DOT COM and 9/11 Terrorist attacks in NY.  Since that time, the US Fed and global central banks have engaged in a series of QE experiments designed to spark economic activity.  We believe the core element of the current COVID-19 economic contagion is not related to the central bank’s inability to print more money to throw at the problems in the markets.  The problem exists that a healthy market must remove risky debt/credit issues and unhealthy deficits in order to sustain real forward growth opportunities.  See this ZeroHedge article for a clear example of what we are attempting to explain: www.zerohedge.com

Looking at some of the charts from the ZeroHedge article, it becomes clear that real economic growth (in relation to proper debt expansion and economic function) likely completed a transitional cycle end near 1999~2002.  This came after the US Fed reached peak interest rate levels in the early 1980s and began a deficit spending binge that continues till today.  As credit/debt became the new norm, we can see how the expansion of credit created a broader expansion of capital valuation levels (global stock market prices) and provided for an expansion of derivatives and global shadow banking operations.  Debt begot more debt/credit – which begot more debt/credit.  And the cycle continues until it breaks.

(Source: https://www.zerohedge.com/markets/debt-chasm-just-too-big-fed-fill)

We believe the unwinding process of the global credit market is really just beginning.  The COVID-19 virus event was just the catalyst for this event.  The virus event prompted a collapse in the global economy because of the global economic shutdown that took place to prevent the spread of the virus.  This shutdown strained the global economic/credit market and continues to do so today, by exposing many at-risk companies and business enterprises that were operating on the “fringe” – that space where lack of consumer engagement creates a void in income while debt levels continue to plague future operations.  We believe this process of UN-leveraging debt will continue until the markets decide a suitable amount of risk has been removed from the markets.  This is when global economic expansion and growth will begin to take hold.

WEEKLY CUSTOM VOLATILITY INDEX – DELEVERAGING IS THE NEW NORMAL

This Weekly Custom Volatility Index highlights the potential for a “new normal” range as the recent deep low levels on this chart suggests a “deleveraging” process is currently taking place.  Even as the US Fed and global central banks pour trillions into the markets, this Custom Volatility Index continues to suggest deleveraging is still ongoing throughout the global markets.  Our research team believes the US Fed and global central banks are simply sucking up the immediate risk “froth” in the global markets while the “real meat” of the issue still persists.

PRECIOUS METALS ANALYSIS POINTS TO HIGHER PRICES LONG TERM

This analysis leads us to Precious Metals – yes, we know, everyone is talking about Gold and Silver right now.  Yet, the real reason we are talking about Gold and Silver is because we believe the current economic environment will present an incredible (once in a lifetime) opportunity for skilled traders.  Once you truly understand the process that is taking place throughout the globe and how debt/credit expansion over the past 45+ years has propelled the capital markets to massive highs while the metals market has been ignored.

Recently, Gold has rallied to a 6+ year high and Silver is still trading near multi-year lows.  The reality is that the global stock market is about to experience a credit/debt revaluation event that is unlike anything we’ve seen since 1929 and/or WWII.  Precious metals are about to enter a phase that has never been experienced in recent history.  What happens to safe-havens throughout the process of a global market credit/debt crisis event?  What happens to metals as the global economy attempts to wash-away excessive debt, derivatives and shadow banking risks that have built up over the past 40+ years?

CONCLUDING THOUGHTS:

If we are correct and our Fibonacci price modeling systems are correct, a deeper price low in the global markets is about to set up that will attempt to force a “wash-out” event in the global credit/debt markets.  This process will likely send precious metals skyrocketing higher.  The unknowns of this process are the same unknowns that happened after 1929 & WWII – what will the new financial functions and societal structure be composed of?  Until that side of the future becomes more clear, expect a number of unknown factors to continue to drive excessive volatility and risk in the global markets.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

Artificial Intelligence Fibonacci Trading System Predicts Next Price Move

Now that you’ve learned about Fibonacci Price Theory Part I and how major and minor Fibonacci Price Pivots help to map out true price structure Part II, we’ll continue our research article illustrating why we believe a deeper price low should take place before a true bottoms sets up in the US and global markets.

Our researchers use a host of available tools and proprietary price modeling systems in an attempt to identify the most likely outcome of future price activity.  Within this article, we’re focusing on the Fibonacci Price Theory and our Adaptive Fibonacci Price Modeling system.  We just taught you about Fibonacci Price Pivots and how to use them.  Now, we are going to go into a detailed analysis of deeper Fibonacci price theory with the NQ (NASDAQ)

DAILY NASDAQ FIBONACCI CHART

This Daily NQ chart, below, should show you a whole new world if you are viewing the chart bars in the Fibonacci price structure.  The recent highs in price, near 8000, have established a minor Fibonacci High Pivot.  There is another minor Fibonacci High Pivot back near 9000 in the midst of the sell-off.  There are others in this chart as well – see if you can find them.

The structure of price based on Fibonacci Price Theory continues to suggest that resistance will be found near the 7875 or the 8210 levels in the NQ that may prompt a strong Bearish price reversal.  The NQ price would have to rally to levels above 9000, at this point, to qualify as a potential Bullish trend based on Fibonacci Price Theory.  The minor price pivot high near 9000 can be interpreted at a Major Price Pivot because of the size of the downside price move.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

WEEKLY NASDAQ FIBONACCI CHART

This last chart highlights our Weekly Adaptive Fibonacci Price Modeling system and shows the GREEN Trigger Line on the right side of the chart.  The Bullish Trigger level on the NQ Weekly chart is at 8200.  This suggests that the NQ price would have to rally and close above the 8200 level to have any type of early confirmation of a potential bullish price trend.  If the price were to fail near 8200 and fall below this level, then the bullish trigger is negated.

You can see what our research team expects to happen by the drawn levels on the chart below.  We believe a deeper price low must complete in order for the proper Fibonacci price structure to set up a bottom.  The next Major low price pivot for the NQ is the 2018 low level near 5824.  It is very likely that this level will become the next downside target should the current NQ price rally fail.  Remember, failure to establish a new price high means price must attempt to establish a new price low.

A couple of weeks go I published a PDF guide on how to identify market trends both short-term and long-term using some basic indicators.

CONCLUDING THOUGHTS:

If you are trying to call a bottom in this market, we urge you to move towards a safer stance in your investing style.  We moved our clients into a nearly 100% cash position just before the peak in the markets.  Since then, we’ve been very protective of assets and allocated only a small portion of our capital to new trade signals.

This is not the time to get married to any positions or trades.  The markets can change in an instant and the volatility is still excessive (VIX above 40)

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

Our Fib Trading System is Telling Us Where The Market Is Headed Next

In this section of our multi-part research post centered around our Adaptive Fibonacci Price Modeling system’s expectations, we are focusing on the NQ (NASDAQ futures) and the future expected price rotations. As we discussed earlier, in Part I, Fibonacci price theory teaches us that price must always attempt to establish new price highs or new price lows within a trend.  Reversals happen when price fails to continue establishing new price highs or new price lows and breaks above or below a recent critical price level.

First, we’ll focus on the major Fibonacci Price Pivots and how to identify and use them with the Fibonacci Price Theory.  Major Price Pivots are points in time where a major new High or Low price is established that becomes a critical price top or bottom.  Often, within extended trending, a minor price pivot will become a major price pivot simply because the price trend has extended for many weeks or months without establishing any type of moderate price rotation.  The reason we could consider a minor price pivot as a major price pivot is that, within the extended trend, we attempt to identify where price setup a “unique low” or “unique high” as a point of support or resistance within the trend.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

WEEKLY NASDAQ CHART – MAJOR PIVOTS

Here is a Weekly NQ chart highlighting the major Fibonacci Price Pivots.  Notice the Major Low Pivot in late November 2019 that was identified as a “minor to major” pivot.  These major price pivots become a road map telling us where price MUST go in order to establish a new trend or to change trend direction.

Currently, the bearish trend is clearly identifiable because the price has recently broken below the last major Fibonacci Low Price Pivots and established a “new price low”.  In order for us to consider this bearish trend is completed or over, the price would have to rally all the way back to break the move recent major Fibonacci High Price Pivot (near the recent peak). A couple of weeks go I published a PDF guide on how to identify market trends both short-term and long-term using some basic indicators.

NASDAQ WEEKLY CHART – MINOR PIVOTS

Now, let’s learn about the minor Fibonacci Price Pivots…

This next Weekly NQ chart highlights the minor Fibonacci Price Pivots.  These are the price lows and highs that do not constitute a “critical price high or low” on the chart.  They are still valid for us in our understanding of Fibonacci price theory and where future price may attempt to rally or selloff to and they help skilled traders in understanding the true nature of price activity and structure.

Minor Fibonacci Price Pivots are intermediate unique high or low price levels that set up the “wave structure” in price that we are attempting to illustrate to you.  When price moves higher, a series of new higher highs and higher lows usually sets up within that trend.  When price moves lower, a series of new lower lows and lower highs usually set up within that trend.  These minor pivots are a method of tracking this type of price activity and a process of learning the major and minor price levels that usually become very important in determining what is really happening in price structure.

COMBINING BOTH MINOR AND MAJOR PIVOTS

Now, we’ll combine these major and minor pivots onto one chart to grasp the bigger price structure.

Once we combine these major and minor Fibonacci Price Pivots onto one chart, you should be able to see the “road-map” of the structure of price fairly easily.  You should be able to see how Major Pivots setup massive critical price structures (tops and bottoms) that establish the major support and resistance levels in price.  These also become major trigger levels for broader trends and reversals in price.  You should also be able to see how the Minor Pivot Levels offer intermediate price guidance and shorter-term support and resistance as price attempts to work through the Fibonacci Price Theory Structure.

Remember, the Fibonacci Price Theory suggests that price is always attempting to reach new highs or new lows within a trend.  Thus, if it is not attempting to reach new highs, then it must be an attempt to reach new lows.  These pivot structures are the keys to understanding the true Fibonacci price theory.

CONCLUDING THOUGHTS:

Currently, The NQ would have to rally all the way back above 9750, the most recent Major Fibonacci Pivot High, in order to qualify for a new Longer-term Bullish trend.  We expect the price of the NQ will rotate lower in the near future simply because the most recent confirmed price trend was the breakdown low in early 2020 that broke below the past three major Fibonacci Low Price Pivots.

Remember the Fibonacci Price Theory tells us that Price is always attempting to establish new price highs or lows – all the time.  Thus, if the newest price low has broken below the past Major Low Price Pivots, then the trend is considered Bearish until price confirms it has broken above the most recent Major High Price Pivot.

As you continue to learn Fibonacci Price Theory and apply these techniques, remember that these types of price structures are fundamental components to the much broader technical analysis techniques and modeling systems we use every day for our clients.  We want to help you learn to become a better trader and learn to identify solid trading signals.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders. 2020 is going to be an incredible year for skilled traders.  Don’t miss all the incredible moves and trade setups.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

Adaptive Fibonacci Suggests A Deeper Bottom Will Setup

Our Adaptive Fibonacci Price Modeling system suggests a much deeper price move is in the works and the current price rally will likely end near resistance levels identified by the Adaptive Fibonacci Price Modeling system.  We are posting this research post for friends and followers to help them understand the true structure of price and to allow them to prepare for what we believe will become a much deeper downside price move in the future.

Fibonacci Price Theory teaches us that price moves in waves within up and down price cycles.  The recent peak in price, near February 25, 2020, has resulted in a very deep -36% price collapse in the S&P 500 (ES) recently.  This downside move has been mostly straight down, excluding a brief retracement in early March.  The strength of this downside price move suggests a moderate upside price recovery will take place before the next downside leg sets up.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

S&P 500 WEEKLY CHART OF 2008-09 CREDIT CRISIS MARKET COLLAPSE

Throughout the 2008-09 Credit Crisis market collapse, prices staged multiple recovery attempts within the downward price trend.  The first, after the initial -20.88% selloff in late 2007, resulted in a +14.83% price recovery that lasted for over 15+ weeks.  The second recovery, near the end of July 2008, resulted in a +9.56% recovery after a nearly -17% price decline.  After this brief recovery in July 2008, the price collapsed by a massive -44% from August to November 2008.

DAILY S&P 500 CHART

This Daily ES chart highlights the first two levels of resistance at 2700 & 2870 that could stall the rally and prompt a downside price move in the future. Support is currently at 2450.  We believe the 2700 level will act as a soft ceiling in the ES where price may attempt to rally, briefly, above this level, which it did yesterday, then pull back and pause as selling pressure re-enters the market.  The 2870 level may act as a hard ceiling where price may attempt to reach this level, but immediately reverse back to the downside.

Overall, we believe continued selling as a result of forward global economic expectations is the most obvious outcome where a deeper price bottom will setup sometime later this spring or early summer.

WEEKLY S&P 500 CHART

This Weekly S&P 500 chart (ES) shows a possible outcome for price going forward if another downside move starts.  A new downside price move to levels near to, or just below, the 2015~16 low price range is not unreasonable. From this level, we believe a “Flag” formation will setup creating an extended price bottom pattern down at those extreme lows.  We believe this “Flag” formation will end near August~October 2020, just before the 2020 elections and prompt the beginning of a new upside price recovery in the US and global markets.

This is a large forward-looking projection and you may be rolling your eyes, but they are very possible. In fact, last year we predicted the months and price levels in which gold and oil would start new major trends, and we did this 8 months before they took place, similar to what we are proposing here.

CONCLUDING THOUGHTS:

The rotation in price setup by this brief upside price move will set up a new Fibonacci downside and upside price target range.  We believe it is essential for price to continue this type of rotation as the eventual bottom sets up in the US and global markets.  We believe the true price bottom will happen only after the virus event has subsided and global economies begin to start functioning like normal again.

Currently, there is simply too much of a world-wide disruption to expect that the bottom has already set up near last year’s (2019) brief price lows.  The scale and scope of the current downside price collapse do not properly reflect the total scope of this global virus event yet – it is still a reactionary move in price that has yet to properly digest the total scope of the global economic disruptions. There is a chance for stronger bounce/rally in the next few weeks/months if the virus can start to be contained, and that will continue to mimic that of the 2000 tech bubble. Believe it or not, there is a big similarity to what happened then, to what is happening now in terms of price action and market sentiment. Read article and see these charts.

In other words, we believe more selling will be seen in the global markets and more economic contraction will take place until we are safely beyond this virus event.  The longer the global economic shutdown continues, the more likely we are to see a deeper price bottom in the future and the more likely we are to see more extensive economic collateral damage across the world. No matter which way the markets move we will follow and trade the price action and profit. That is the benefit of following price vs trying to trade prediction, fundamental data etc.

In Part II of this research article, we’ll dig deeper into the underlying components that support our research.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles in stocks and commodities. I believe I have a good pulse on the market and timing key turning points for investing and short-term swing traders.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts visit my Active ETF Trading Newsletter.

We all have trading accounts, and while our trading accounts are important, what is even more important are our long-term investment and retirement accounts. Why? Because they are, in most cases, our largest store of wealth other than our homes, and if they are not protected during a time like this, you could lose 25-50% or more of your entire net worth. The good news is we can preserve and even grow our long term capital when things get ugly like they are now and ill show you how and one of the best trades is one your financial advisor will never let you do because they do not make money from the trade/position.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.