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The August Stock market Breakdown Prediction and Analysis

Our August 19th breakdown prediction aligns with our other analysis tools and predictive modeling systems.  The key to understanding price action lies in two modes of operational aspects for analysts.  Either the analysis is going to be correct and the markets will break down as we have predicted or the analysis will be incorrect and the markets will break higher to rally to new highs.  We call this the “failure to fail” mode or the “failure to succeed” mode of compliance for price.  Either it will do what we expect or it won’t.

There are a few things that we, as analysts, must take into consideration with regards to future predictions of price action and direction.  First, sometimes we fail to make perfect predictions.  It is not easy or 100% guaranteed that our predictions will become valid or accurate on the day we suggest price should move in a certain direction.

We are going to show you the ADL charts that support our predictions and we are going to discuss why we believe the setup is still valid, but we are going to have to let price confirm our prediction and wait for it to move in a direction that either confirms our research or invalidates it.

As many of you know, we use advanced tools to help us understand and predictions regarding future price moves.  Many of our tools align with price cycles, predictive modeling, and other price modeling tools that we use to try to understand where and when the price may turn or continue to trend in a specific direction.

One of our most advanced tools is the Adaptive Dynamic Learning (ADL) predictive modeling tool.  With it, we can ask the ADL tool to show us what price will attempt to do in the future based on a type of DNA candlestick mapping that attempts to isolate the highest probability outcomes.

Weekly NQ Futures Index Chart

Below, we’ve included a Weekly NQ ADL chart that shows you what our ADL predictive modeling system it expecting the NQ price to do over the next 10+ weeks.  You can see from this chart that price is expected to trail lower from current levels and to potentially reach a low point of 6500 by early October 2019.

One other aspect that we must consider is that price can sometimes react 2-5 weeks later than the ADL predictive price levels show.  We call these Price Anomalies.  This is where price sets up an unusual price formation that is actually moving against the ADL predictive price level (in this case, staying higher while the ADL predictive price level moves lower).

We determine these to be price anomalies because, in most cases, the price will eventually break toward the ADL predictive price level in a reversion move.  Therefore, these anomalies can sometimes be very good trading signals as price moves against the ADL predicted trend.

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VIX Weekly Chart

The ADL of the VIX Weekly chart shows a spike in the VIX levels over the next 3 to 7+ weeks.  This spike will likely coincide with a downward price move in the US markets that could begin as early as early September 2019.

The purpose of this ADL VIX Chart is to show you how our ADL modeling system is able to warn us of future price moves and how we can align certain analysis results with other charts to form a larger perspective of the markets in general.


Concluding Thoughts:

As of right now, the August 19th breakdown prediction we shared more than a month ago still stands as the price has yet to rally above 8050 on the NQ to present a new upside price trend.  Our ADL predictive modeling system is still suggesting that the price wants to move lower from current levels and attempt to target the 6500 price level.

Even though the exact August 19th date did not result in a price breakdown event, you must understand we were calling for a breakdown to happen “on or near August 19”.  That means sometime this week or next week most likely – possibly a bit later if the price anomaly of the stock indexes holding up at the upper end of our ADL price range.

If you’ve followed our research long enough you’ll understand that we can make these predictions about the future based on our advanced predictive modeling tools and research – yet we can’t be 100% accurate on the date/time of the event because we don’t have the ability to see that much detail or control what the global markets do in terms of price, trends, global central banks, and other factors.  We can only relate what we see in the markets using our modeling tools and attempt to help you understand what our predictive modeling systems are suggesting.

Right now, a price anomaly where the price is trading above our expected price prediction level appears to be set up which will likely result in a price breakdown in the near future (3 to 10+ days).  Time will tell.  If price rallies because of some external factor and breaks the 8050 highs on the NQ, then we would consider the ADL predictive analysis result to potentially be invalidated because of this new high.  Currently, that is not the case and we are waiting for the breakdown event to begin and will position our money accordingly when price confirms the move.

If you like this big-picture analysis and forecasts be sure to opt-in to my free market research newsletter or let me send you my low-risk index ETF trade signals plus my analysis with my Wealth Building Trading Newsletter.

Chris Vermeulen
www.TheTechnicalTraders.com

US Fed Set To Rattle Global Markets – Part II

Today is the day for the US Fed to announce their rate decision and we believe the 25 basis point rate cut is the only option they have at the moment that will attempt to settle foreign market fears and allow for a suitable “unwinding” of the credit/debt “setup” we highlighted in Part I of this research post.

We believe out August 19 expectation of a global market PEAK and the beginning of a price reversion move is related to multiple aspects of the timing of this Fed move and the current global economic outlook.  The unwinding of this debt/credit bubble will likely take many more years to unravel.  Yet, right now the US Fed is trapped in a scenario they never expected to find themselves in.  Either continue to run policy that supports the US economy (where rates would likely stay between 1.75 to 2.75) over the next 5+ years or yield to the global market and attempt to address a proper exit capability for this debt/credit “setup”.

We believe global investors are expecting a massive collapse in the US stock market as a reaction to this move by the Fed and because of the expectation that another bubble has set up in the US.  But we believe the actual bubble is set up in the foreign markets and not so much in the US.  Yes, the US markets have extended to near all-time highs and the US consumer is running somewhat lean.  It would be natural for the US economy to revert to lower price levels and for the US economy to rotate as “price exploration” attempts to find true market support.  Yet, our fear is that the foreign markets are much more fragile than anyone understands at the moment and that a reversion in the US markets will prompt a potential collapse in certain foreign markets.

Weekly SPY chart

This Weekly SPY chart highlights what we expect to transpire over the next 6 to 8+ months.  We believe the August 19 peak date that we predicted months ago will likely start a process that will be tied to the US election cycle event (2020) and the US Fed in combination with global market events.  We believe a reversion price process is about to unfold that could be prompted into action over the next 2+ weeks by the US Fed, trade issues and global central banks.

If the US Fed drops the FFR by 25pb, the fragility of the foreign market debt/credit issues is not really abated or resolved.  It just allows for a bit of breathing room that may allow these foreign debtors enough room to wiggle out of some of their problems.  The US Fed would have to decrease rates by at least 75 basis point before any real relief will materialize for these foreign debtors.

Asian Currency Custom Index

This Asian Currency Custom Index used by our research team highlights the weakness in the foreign markets.  The recovery in 2018 is related to the Chinese/Asian currency market recovery that initiated in Feb/Mar 2018.  The recent weakness in this custom index is related to strengthening major market currencies (USD, CAD, JPY, CHF) in relation to weakening Asian currencies.  Notice how the price channels have set up to warn us that any further downside move will initiate a new “price exploration” phase that could see a -20% to -25% decrease in currency valuations – possibly much deeper.

We believe this is the real reason the US Fed is opting to decrease the FFR rate now and is not taking a more stern position related to US economic performance.  We believe the US Fed is, again, donning the “Superman cape” and attempting to Save The World from their own debt/credit mess.

We are holding to our original predictions and expectations.  We believe the US stock market indexes will enter a reversion price phase over the next few weeks that will prompt a downside price reversion toward recent lows (2018 levels or deeper).  We believe this process will end in early 2020 and that the lows established by this move will represent incredible opportunities for skilled technical traders.

Weekly Dow Jones chart

This Weekly Dow Jones chart highlights our expectations.  We believe a mild price rotation will start this move over the next 2~4 weeks before the August 19, 2019 date prompts a breakdown move.  After that date, we believe an extended downside price leg will continue to reach a price bottom near the end of 2019 or in early 2020.

This Weekly Dow Jones chart highlights our expectations.  We believe a mild price rotation will start this move over the next 2~4 weeks before the August 19, 2019 date prompts a breakdown move.  After that date, we believe an extended downside price leg will continue to reach a price bottom near the end of 2019 or in early 2020.

Skilled traders understand how the global markets are setting up for incredible opportunities and how to identify where and when these opportunities are ripe for profits and this is where we can help you!

CRUCIAL WARNING SIGNS ABOUT GOLD, SILVER, MINERS, AND S&P 500

In early June I posted a detailed video explaining in showing the bottoming formation and gold and where to spot the breakout level, I also talked about crude oil reaching it upside target after a double bottom, and I called short term top in the SP 500 index. This was one of my premarket videos for members it gives you a good taste of what you can expect each and every morning before the Opening Bell. Watch Video Here.

I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused mainly on the SP 500 index and the gold miners index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.

On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.

More recently on July 16th, I warned that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.

CONCLUDING THOUGHTS:

In short, you should be starting to get a feel of where each commodity and asset class is headed for the next 8+ months. The next step is knowing when and what to buy and sell as these turning points take place, and this is the hard part. If you want someone to guide you through the next 12-24 months complete with detailed market analysis and trade alerts (entry, targets and exit price levels) join my ETF Trading Newsletter.

Be prepared for these incredible price swings before they happen and learn how you can identify and trade these fantastic trading opportunities in 2019, 2020, and beyond with our  Wealth Building & Global Financial Reset Newsletter.  You won’t want to miss this big move, folks.  As you can see from our research, everything has been setting up for this move for many months.

Join me with a 1 or 2-year subscription to lock in the lowest rate possible and ride my coattails as I navigate these financial market and build wealth while others lose nearly everything they own during the next financial crisis.

As a technical analysis and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for both short-term swing trading and long-term investment capital. The opportunities starting to present themselves will be life-changing if handled properly.

FREE GOLD OR SILVER WITH MEMBERSHIP!

Kill two birds with one stone and subscribe for two years to get your FREE PRECIOUS METAL and get enough trades to profit through the next metals bull market and financial crisis!

Chris Vermeulen – www.TheTechnicalTraders.com

August 19 Price Peak Prediction Is Confirmed By Our ADL Predictive System

Our Adaptive Dynamic Learning (ADL) predictive price modeling system is one of the most unique and incredible predictive price utilities anyone has ever seen.

Over the past 24+ months, the ADL system has been able to call nearly every market rotation in the US major indexes (the ES, NQ, and YM) as well as our incredible call in Gold from October 2018 till now.  There is really nothing on the planet that can make accurate predictions for future price activity like our ADL predictive modeling tool.

Weekly chart of the NQ – NASDAQ

This Weekly chart of the NQ (NASDAQ futures) highlights the ADL predictive modeling systems results from a price peak in late April 2019.  The results consist of 52 unique price instances that make up the future predictive price levels.  This prediction suggested that price would fall to levels near $7200 by May 27, 2019, then rally from that date to a peak level near August 19, 2019.  This new August 19 peak level will likely be near $8500 – nearly +500 pts from the current price level.

Traders that have setup short positions may feel quite a bit of pressure over the next 4+ weeks as this move higher extends to align with our ADL predictive modeling system.  Overall, we believe a volatile price period in the markets may extend near this August 19 prediction where price volatility will increase and a potential for a downside price rotation may occur.

Additional ADL predictive results suggest a downside potential for price to levels near $7200 as volatility increases near August 19, 2019.  These predictions are suggesting that the key date, August 19, 2019, will likely be the peak in the price for a period of time.  The downside predictions where the price is suggested to reach $7200 indicates the range of potential volatility after the August 19 peak.

We have been suggesting that traders continue to scale back long positions before this peak is reached.  Ideally, we urge traders to pull some profits off the table and to prepare for this potential rotation in price as well as to prepare for increased volatility near or after August 19, 2019.  Our extended research suggests deeper support is found near $6700 and we believe a volatility increase could drive prices towards these levels in a reversion price rotation.

As of right now, the most logical expectation for the price is for a continued upside price bias lasting 3 to 4 more weeks reaching a price peak near August 19, 2019 – just as we originally predicted. The Fed rate cut we just talked about could be what spurs the market on for this final exhaustion rally. As we near that critical date, we expect to see increased volatility throughout the global stock market and we would expect the VIX to begin a spike move higher.

Currently, an ADL price anomaly is setting up that may prompt a quick downside move on or after the August 19 date.  It is because of this price anomaly setup that we are suggesting the bottom for the price could be anywhere between $6500 and $7200 (ADL predicted levels).  In other words, get ready for some increased volatility and a very strong potential for a price reversion to unfold.

We have seen some really strange price action in small-cap stocks this week which I will cover shortly as well, so stay tuned!

CRUCIAL WARNING SIGNS ABOUT GOLD, SILVER, MINERS, AND S&P 500

In early June I posted a detailed video explaining in showing the bottoming formation and gold and where to spot the breakout level, I also talked about crude oil reaching it upside target after a double bottom, and I called short term top in the SP 500 index. This was one of my premarket videos for members it gives you a good taste of what you can expect each and every morning before the Opening Bell. Watch Video Here.

I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused mainly on the SP 500 index and the gold miners index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.

On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.

More recently on July 16th, I warned that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.

CONCLUDING THOUGHTS:

In short, you should be starting to get a feel of where each commodity and asset class is headed for the next 8+ months. The next step is knowing when and what to buy and sell as these turning points take place, and this is the hard part. If you want someone to guide you through the next 12-24 months complete with detailed market analysis and trade alerts (entry, targets and exit price levels) join my ETF Trading Newsletter.

Be prepared for these incredible price swings before they happen and learn how you can identify and trade these fantastic trading opportunities in 2019, 2020, and beyond with our  Wealth Building & Global Financial Reset Newsletter.  You won’t want to miss this big move, folks.  As you can see from our research, everything has been setting up for this move for many months.

Join me with a 1 or 2-year subscription to lock in the lowest rate possible and ride my coattails as I navigate these financial market and build wealth while others lose nearly everything they own during the next financial crisis.

As a technical analysis and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for both short-term swing trading and long-term investment capital. The opportunities starting to present themselves will be life-changing if handled properly.

FREE GOLD OR SILVER WITH MEMBERSHIP!

Kill two birds with one stone and subscribe for two years to get your FREE PRECIOUS METAL and get enough trades to profit through the next metals bull market and financial crisis!

Chris Vermeulen – www.TheTechnicalTraders.com

Fear Drives Market Expectations

The continued upside price move in Gold is a very clear sign that fear is starting to enter the global markets again.  We read an article last night that suggested many professional fund managers are preparing for a bigger downside price move as well as expecting the US Fed to potentially decreased interest rates over the next 12 to 24 months as the expected downside price move takes place.  We understand this concern by many industry professionals and share some of their same concerns, yet we believe these individual are far too early in shifting their stance in the markets right now.

As you may be aware, our research does not show any major downside risks until later in July 2019 or August 2019.  Even then, the price of the Dow Jones Index would have to fall over 18% before the December 2018 lows become threatened.  The current upside price recovery, with the Dow Jones up over 400 pts from the lows on Monday, June 3, suggests the US market and the Capital Shift that has been taking place over the past 24+ months is still rather strong with investor buying dips. We told our followers this bounce was about to happen the day before it bottomed here.

It seems that everyone is trying to pick a top or call the big crash right now.  Back in November 2018, it seemed like every professional trader we knew was advising their client “This is the BIG ONE” and suggesting the US markets could never recover from a deep sell-off like the one we experienced in late 2018.  Yet, here we are, after reaching near all-time highs again, rotating a bit lower and the same voices seem to be stating “This is the BIG ONE” again.

Allow us to help clear up what is likely to happen based on our research and proprietary modeling tools.

This first chart of the VIX (Volatility Index) shows what we believe to be the most likely outcome over the next 30+ days.  After a spike in the VIX in early may which our followers profited over 25% in a few days, we believe a downward pricing channel will set up where the VIX will continue to drift lower – eventually settling back below 14 again for another setup.  It is very likely that this volatility consolidation coincides with a US stock market price recovery over the same span of time.  We’ll get into more detail in the following charts.

Eventually, sometime in mid-July or mid-August, we expect the VIX to spike well above 20 to 22 as a broader US stock market price collapse takes place.

Throughout our expectations, we expect the US Dollar to enter a similar type of price pattern – setting up a Pennant formation after a moderately deep price correction nearing the $95 level.  We believe the US Dollar will continue to move lower, driving precious metals higher, where the $95 support level is the key target.  Once this level is reached, we believe the US Dollar will rotate higher and attempt a move above $97.50 again – possibly attempting new price highs.  These new highs are likely to happen in early to mid July 2019.

Our last chart highlights what we believe will happen in the Dow Jones Index (as a general market example of what will likely happen in the ES, NQ and YM).  As you can see, we believe the downside price swing that has currently taken price nearly -7.25% lower should be very close to completion.  We believe the $24,300 to $24,600 level will act as strong support for this move and prompt another upside price leg over the next 7 to 14 days.  We believe this upside price leg will push the DJI price level back towards the $26,000 level by late July or early August 2019.

We are suggesting that the early move into a protectionist stance by professional traders may be about to experience some extreme pressures.  Should the US/China trade issue or the Mexico trade issue lessen or be resolved over the next 60+ days, the US stock markets could rally towards new highs fairly quickly.  If things stay the same as they are now, we expect price to move exactly as we have highlighted on these charts.

Near the end of July or sometime in August 2019, we expect a bigger top formation to setup where a moderate price collapse may take place.  Everything must setup perfectly for this to happen and we still have 40 to 60+ days of trading before this setup gets closer.  Lots of things can happen over this span of time, so pay attention to our continued research to stay ahead of these moves.

One thing you can do to prepare for any future price volatility or rotation is to accumulate Gold and Silver positions near recent lows. If you like precious metals see my forecasting signals here  This increase in volatility means that precious metals should continue to push higher as fear becomes more rooted across the globe.

We’ve now shown you two different price setups using Fibonacci price theory and the only thing we have to do is wait for a technical price confirmation before finding our entry trade.  We’ll see how this plays out over the next few days and weeks.  Remember, we are not proposing these as “major price bottoms”. They are “upside pullback trades” (bounces) at this point.  A bullish price pullback in a downtrend.

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Chris Vermeulen