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Energy Continues Basing Setup – Breakout Expected Near January 24th

After watching Crude Oil fall from the $65 ppb level to the $58 ppb level (-10.7%) over the past few weeks, we still believe the energy sector is setting up for another great trade for skilled investors/traders.

We are all keenly aware that Winter is still here and that heating oil demands may continue to push certain energy prices higher.  Yet Winter is also a time when people don’t travel as much and, overall, energy prices tend to weaken throughout Winter.

Over the past 37 years, the historical monthly breakdown for Crude Oil is as follows:
December: Generally lower by -$0.33 to -$0.86.  Averages to the downside: -3.65 to +3.08
January: Generally lower by -$4.57 to -$6.72.  Averages to the downside: -2.68 to +2.27
February: Generally higher by +$8.41 to +13.73.  Averages to the upside +3.07 to -2.54
March: Generally higher by +7.33 to +$15.62.  Averages to the upside by +2.84 to -2.14

Over the past 25 years, the historical monthly breakdown for Natural Gas is as follows:
December: Generally lower by -$2.34 to -$5.26.  Averages to the downside: -0.81 to +0.69
January: Generally lower by -$5.14 to -$7.97.  Averages to the downside: -0.69 to +0.45
February: Generally lower by -$1.48 to -$3.62.  Averages to the downside -0.50 to +0.49
March: Generally higher by +0.63 to +$1.88.  Averages to the upside by +0.41 to -0.70

Over the past 35 years, the historical monthly breakdown for Heating Oil is as follows:
December: Generally lower by -$0.16 to -$0.37.  Averages to the downside: -0.14 to +0.09
January: Generally lower by -$0.52 to -$0.96.  Averages to the downside: -0.09 to +0.10
February: Generally higher by +$0.48 to +$1.06.  Averages to the upside +0.11 to -0.08
March: Generally higher by +0.03 to +$0.11.  Averages to the upside by +0.09 to -0.10

This data suggests an extended Winter in the US may prompt further contraction in certain segments of the energy sector that may prompt an exaggerated downside price move in Crude Oil and Natural Gas.  Heating Oil may rise a bit if the cold weather continues well past March/April 2019.

Conversely, if an early spring sets up in the US, then Crude Oil may begin to base a bit as people begin to traveling more, but Heating Oil and Natural Gas may decline as cold weather demands abate.

Heating Oil has almost mirrored Crude Oil in price action recently.  Our modeling systems are suggesting that Crude Oil may attempt to move below $40 ppb.  This move would be a result of a number of factors – mostly slowing global demand and a shift to electric vehicles.  We authored this research post early in January 2020 – please review it.

January 8, 2020: IS THE ENERGY SECTOR SETTING UP ANOTHER GREAT ENTRY?

We believe any price level below $40 in ERY is setting up for a very strong basing level going forward.  We have identified two “pullback zones”.  The first is what we call the “Deep Pullback Zone”.  The second is what we call the “Deeper Pullback Zone”.  Any upside price move from below $40 to recent upside target levels (above $50) would represent a 25%+ price rotation.

Historically, February is a very strong month for ERY.  The data going back over the past 12 years suggests February produces substantially higher upside price gains (+1899.30 to -394.28) – translating into a 4.8:1 upside price ratio over 12 years.  Both January and March reflect overall price weakness in ERY over the past 12 years.  Thus, the real opportunity is the setup of the “February price advance”.

We believe any opportunity to take advantage of this historical technical price pattern is advantageous for skilled traders/investors.

This is a pure technical pattern based on price bar data mining.  This is something you may not have ever considered unless you had the tools to search for historical price anomalies and rotation patterns.  We have created a suite of tools and price modeling systems we use to help our members find incredible opportunities – this being one of them.

Get ready, February will likely prompt a very nice rally in ERY if historical price triggers confirm future price activity.  The price pattern in February suggests a large upside price move is likely in ERY and we believe these low price basing patterns are an excellent opportunity for skilled traders.

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Chris Vermeulen
www.TheTechnicalTraders.com

NOTICE: Our free research does not constitute a trade recommendation or solicitation for our readers to take any action regarding this research.  It is provided for educational purposes only.  Our research team produces these research articles to share information with our followers/readers in an effort to try to keep you well informed.  Visit our web site to learn how to take advantage of our members-only research and trading signals.

NASDAQ Set to Fall 1000pts In Early 2020, and What it Means for Gold

One of our most interesting predictive modeling system is the Adaptive Dynamic Learning (ADL) price modeling system.  It is capable of learning from past price data, building price DNA chains and attempting to predict future price activity with a fairly high degree of accuracy.  The one thing we’ve learned about the ADL system is that when price mirrors the ADL predictive modeling over a period of time, then there is often a high probability that price will continue to mirror the ADL price predictions.

One of our more infamous ADL predictions was our October 2018 Gold ADL prediction chart (below).  This chart launched a number of very interesting discussions with industry professionals about predictive modeling and our capabilities regarding Adaptive Learning.  Eric Sprott, of Sprott Money, highlighted some of our analyses related to the ADL predictive modeling system in June and July 2019.  Our ADL predictive modeling system suggested a bottom would form in Gold near April/May 2019 and then Gold would rally up toward $1600 by September 2019, then rotate a bit lower near $1550 levels.

LISTEN TO WHAT ERIC SPROTT SAID ABOUT OUR ANALYSIS

OCTOBER 2018 GOLD FORECAST

CURRENT 2020 GOLD FORECAST

This next chart shows what really happened with Gold prices compared to the ADL predictions above.  It is really hard to argue that the ADL predictions from October 2018 were not DEAD ON accurate in terms of calling and predicting the future price move in Gold.  Will the ADL predictions for the NQ play out equally as accurate in predicting a downward price rotation of 1000pts or more?

CURRENT 2020 NASDAQ FORECAST

This NQ Weekly chart shares out ADL Predictive Modeling systems results originating on September 23, 2019.  The Price DNA markers for this analysis consist of 15 unique price bars suggesting the future resulting price expectations are highly probable outcomes (95% to 99.95%).  This analysis suggests the end of 2019 resulting in a broad market push higher in early 2020 may come to an immediate end with a downward price move of 800 to 1000+ pts before January 20~27, 2020.  The ADL predictive modeling system is suggesting price will be trading near 8000 by January 20th or so.

Only time will tell in regards to the future outcome of these ADL predictions, but given the current news of the US missile attack in Iraq and the uncertainty this presents, it would not surprise us to see the NQ fall below the 8000 level as this euphoric price rally rotates to find support before moving forward in developing a new price trend.

Pay attention to what happens early next week with regards to price and understand the 8000 level will likely be strong support unless something breaks the support in the markets over the next 30+ days.  Ultimate support near 7200 is also a possibility if a deeper downside move persists.

As we’ve been warning for many months, 2020 is going to be a fantastic year for skilled technical traders.  You won’t want to miss these opportunities in precious metals, stocks, ETFs and others.

We have a good pulse on the major markets and can profit during times when most others can’t which is why you should join my Wealth Trading Newsletter for index, metals, and energy trade alerts. Visit our website to learn how you can see what this research is telling us.

I am going to give away and ship out silver rounds to anyone who buys a 1-year, or 2-year subscription to my Wealth Trading Newsletter. You can upgrade to this longer-term subscription or if you are new, join one of these two plans listed below, and you will receive:

1oz Silver Round FREE 1-Year Subscription 
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Chris Vermeulen

ADL Predicts Oil Prices Will Fall Below $40

There are times when our research team interprets our advanced predictive modeling systems so well that we call a move in the markets 3 to 10+ months in advance of the move actually happening.  It has happened for our team of research so often lately that we are somewhat used to the accolades we receive from our followers and members.  Our October 2018 Gold price predictions are still playing out  accurately and continue to amaze people – even though we made these predictions over 12 months ago.

Today, we wanted to highlight our Adaptive Dynamic Learning (ADL) predictive modeling systems expectations for Crude Oil, but before we get into the details be sure to opt-in to our free market trend signals newsletter. The research post we made on July 10, 2019 (see below).  At that time, we warned that Crude Oil was about to head much lower and that our ADL modeling system was suggesting that Oil prices would rotate between $47 and $64 before breaking much lower in November 2019.  Ultimately, Oil prices will fall below $40 ppb following our timeline and could begin a broader downside move before the end of October 2019.  Read our full prediction/research report from the link below.

SOURCE: July 10, 2019: PREDICTIVE MODELING SUGGEST OIL HEADED MUCH LOWER

We believe the support level near $50.50 will act as a temporary support level over the next 3 to 10+ days before a moderate price breakdown below this level begins.  Our expectations for November 2019 are that oil prices may fall to levels below $45 ppb on a deeper downward price move, yet will recover to levels near $47 near December 2019/January 2020.

We do believe the ultimate target for Crude Oil prices are to levels below $40 ppb and that price may attempt to make a move towards these level as early as January 2020.  Our ADL predictive modeling system has shown us the path for oil prices and, so far, the real price has mirrored this expectation almost perfectly – even the high price in September aligned with our expected high price near $60.

Weakness should dominate in late October and early November – carrying all the way through most of November.  Pay attention to the ADL chart above and our July 10th predictions.  Oil will target levels below $40 by late December 2019 or early January 2020.

All it is going to take is for this $50.50 support level to be tested and breached for the next price move to begin.  Be prepared for the volatility that may hit oil prices near this critical support level and be prepared for the next move to levels near $44~47.

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 are massive/life-changing if handled properly.

Be sure to ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis. Join Now and Get a Free 1oz Silver Round or Gold Bar and SPECIAL OFFER – CLICK HERE

I can tell you that huge moves are about to start unfolding not only in metals, or stocks but globally and some of these supercycles are going to last years. This quick and simple to understand guide on trading with technical analysis will allow you to follow the markets closely and trade with it. Never be caught on the wrong side of the market again and suffer big losses. PDF guide: Technical Trading Mastery

Chris Vermeulen
www.TheTechnicalTraders.com

Can Oil Stay Above $50 To Support Producers Expectations?

Recent news suggests that oil producers are attempting to increase production levels after failing to attempt to push prices higher by cutting production levels.  Globally, oil producers want to see oil prices rise above $65 ppb in an effort to support profit and production cost expectations.  The real issue for the nation/states that rely on oil production/sales is that the global economy may not cooperate with their expectations over the next 24+ months. Before we get into the details, be sure to opt-in to my Free Market Forecast and Trade Ideas Newsletter so stay on top of these market moves. On August 6th, 2019, we posted this article suggesting that Natural Gas and Crude Oil were setting up diverging trades. August 6th, 2019: NATURAL GAS AND CRUDE OIL – DIVERGING SETUPS FOR TECHNICAL TRADERS At that time, we wrote that we expected Crude oil to break lower from the $62 ppb level and target $55, then $49 based on our original Crude Oil research from May 21, 2019. Additionally, on July 29, 2019, we authored and posted this article suggesting that Crude Oil would begin a downside move from $55 to levels near $50 : All of this research was related to our Adaptive Dynamic Learning (ADL) research post from July 10, 2019: https://www.thetechnicaltraders.com/predictive-modeling-suggest-oil-headed-much-lower-by-early-2020/ This incredible predictive modeling research suggested that Oil would move dramatically lower towards the $50 level, then stall near $50 to $55+ through September and October.  Ultimately breaking lower in late October/November to levels near or below $40.

Crude Oil Daily Chart Analysis

Our researchers believe Crude Oil could become very volatile as price nears the apex of the Pennant/Flag formation that is setting up.  This Daily chart highlights the attempted “scouting party” price rotation above the price resistance channel.  The news over the past holiday weekend suggests the global economy may not see any real bump in activity over the next 12+ months and we believe this aligns with our longer-term research that Oil should target the sub $40 price level before the end of 2019 and potentially fall to levels below $30 in early 2020.

Crude Oil Weekly Chart Analysis

We believe the key to all of this price rotation is the $50.50 level and what price does over the next 30 to 60+ days.  There is a potential that price may attempt a brief upside move over this span of time, but the true intent of price is to move lower based on our ADL price modeling system.  Therefore, we believe the downside potential is the most opportunistic for traders.  The next price target based on our Fibonacci bearish price trigger level is the $45 price range.

CONCLUDING THOUGHTS:

This move could take place quickly, over the next 2 to 3 weeks on a breakdown move, or over many months.  Watch the $50.50 level as that is the key.  If the price falls to any level below $50.50, then we could be moving towards the $45 level or even the $40 on a big move related to global economic expectations.  Otherwise, expect the price to move towards the $50.50 level over the next few weeks as this support level is key to all future moves. As we wait for the next leg to start to move prices lower, pay attention to any upside price activity as that may present a very clear entry point for skilled technical traders. We believe our super-cycle research and other proprietary modeling systems are suggesting that price weakness will dominate the markets for the next few months. Ride my coattails as I navigate these financial market and build wealth while others lose nearly everything they own during the next financial crisis and recession. In short, you should be starting to get a feel of where commodities 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.

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Chris Vermeulen – www.TheTechnicalTraders.com

Fed Leaves Rates Unchanged – Gold & Stocks Rally/Dollar Falls

The Federal Reserve announced they were leaving rates unchanged on Wednesday, June 19.  The markets were expecting this or a quarter percent price decrease.  Initially, the markets reacted to the news by moving to the downside recently. The markets immediately reversed the upside rather dramatically showing that investors believed that that may move into an easy stance within a few months. The big movers after the bad news which we expected were in gold, silver, miners and the US dollar.  Subscribers locked in another 17.4% winning trade on this fed news while the US dollar rotated lower on Tuesday, June 18 prompting a further downside move after the bad news. It is very likely that the US dollar will move lower an attempt to retest support near 96.50.  A weakening US dollar will help to support the US stock market and precious metals prices.  Additionally, a weaker US dollar will help support trade, economic growth, employment, and GDP output.
We believe the US stock market is nearing upper resistance.  We still believe the US stock market will eventually attempt to move about the psychological levels of 3000 for the S&P, 30,000 for the Dow and 340 SPY.  This move to new all-time highs will likely result in a ”scouting party” type of price pattern where price attempts to identify new resistance, slightly above the psychological levels, then reverses back below these levels to retest support. Our continued belief that a large pennant/flag formation is unfolding has not changed. As technical analysts, we need to wait for the new price peak form before we can identify where the upper channel of the pennant/flag formation is trending. We would urge traders to be conscious that any outside move in the stock markets as a very limited upside potential from current levels. The SPY is trading at 293 and we believe upper resistance will be found slightly above 300. Thus, we really have about a $7 or $8 move to the upside from current levels – only about 3% to 4% more room to the upside.
The transportation index paints a very clear picture of price channels, support and resistance, and expected price rotation going forward. The current price channels indicate a high target area near 5250.  This upward channel range is still only 3% or 4% higher from current levels. After this peak level is reached the market should reverse downward attempting to retest support. We believe we are very close to a market top at this point and believe that the US stock market may attempt to move above the major psychological levels – as indicated above. There are a few items which could change our outlook currently. A.  Positive news regarding trade issues with China B.  Renewing or new central bank easing policies C.  Any type of dramatic positive economic news D.  China attempting to resolve banking issues by taking the problems and addressing them with capital/gold reserves. Ideally, there are quite a few opportunities for the stock market rally far beyond the psychological levels. Yet with only about 14 months to go before the US presidential elections and no indication that any of our four critical components for renewed price advance are anywhere close to being accomplished, we hold to the belief that the markets will complete the Pennant/Flag formation as we have originally been stating.
We urge traders to pay attention to precious metals and the US and foreign stock markets as we enter this critical phase of the market. We believe the US stock market will continue to rotate within the channels clearly on the transportation index chart.  We believe any excessive fear will become evident in the bond markets and precious metals well before the US stock market rotates lower. In our opinion, this is not the time to buy into technology or the US stock market expecting a massive breakout to the upside. We are urging our clients to be very cautious over the next 30 to 60 days and to trade with short profit targets in mind. There are a lot of moving components throughout the global economy and we are urging our members to be very aware of the larger patterns that are setting up. Our super cycle research has given us a very clear picture as to what to expect over the next 16 months or longer. We have a good pulse on the major markets and can profit during times when most others can’t which is why you should join my Wealth Trading Newsletter for index, metals, and energy trade alerts. Visit our website to learn how you can see what this research is telling us. I am going to give away and ship out silver rounds to anyone who buys a 1-year, or 2-year subscription to my Wealth Trading Newsletter. You can upgrade to this longer-term subscription or if you are new, join one of these two plans listed below, and you will receive:
1oz Silver Round FREE 1-Year Subscription TWO 1oz Silver Rounds FREE 2-Year Subscription SUBSCRIBE TO MY TRADE ALERTS AND  GET YOUR FREE SILVER ROUNDS! Free Shipping! Chris Vermeulen