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Market Wrap Technical Take with Moe & Chris – Audio


Yesterday I had a great call with Moe Ansari, who has over 40 years of experience trading and investing. We talked about the market and some technical analysis as to what we think about everything happening right now.

Moe and I share a comment thought which is:

IT IS NOT WHAT YOU MAKE, IT IS
WHAT YOU KEEP THAT COUNTS.

I have been pounding on the table for weeks since we closed out last trade in TLT for 20.07% profit on Feb 23rd, that cash is king, and it is more important to avoid uncertainty than it is to try and trade the random and volatile price action.

Subscribers of my ETF trading newsletter love the fact that our trading portfolio is at a NEW HIGH WATERMARK, and we completely sidestepped this market correction, which turned into a full out market crash.

I won’t lie. I knew a market correction was starting, which is why I adjusted our trailing stops to protect us if things began to turn south. But I did not expect a market collapse that would start a new bear market.

The good news is that because I strictly use technical analysis, position-sizing, and management of positions for profit-taking and trailing stops. We will never be caught on the wrong side of the market for more than a few days. So when a market collapse happens like what we are experiencing now, it does not affect our financial outlook.

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 short-term swing traders.

Visit my ETF Wealth Building Newsletter and if you like what I offer, and 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
www.TheTechnicalTraders.com

Chris Featured on TD Ameritrade TV – Safe Plays During Slowdowns

Recently I have been asked to talk on multiple TV shows, radio stations, and podcasts during this wild market correction in almost every asset class.

The reason being I think is from some recent articles I posted publically clearly shows how a technical trader can successfully time, trade, and protect capital no matter what happens in the equities, bonds, and commodities market.

In short, I had subscribers move their money into the leading assets in January which were GDXJ (gold miners) and TLT (bonds). I also talked about consumer staples, and utilities as safe havens.

These assets were outperforming the stock market and that is where you want your money to be positioned as you will earn more over time owning leaders that increase in value more than that of the average stock market index.

Spotting the leaders is not really that difficult, but what is tough is knowing what position size you should have in any given trade, where to place profit targets, and where to place stop losses/trailing stops.

As you have likely noticed gold miners GDXJ fell a whopping 57% from the highs if you didn’t have proven strategy then your likely still holding them and have endured one hell of a rollercoaster ride. Subscribers and I exited GDXJ at the high tick the day price reversed for a 9.5% profit because we had a trading strategy and executed our trading plan.

GDXJ had reached our extreme price target using technical analysis which was a clear resistance level for sellers to unload shares and that’s what did, sold our shares as well.

TLT actually had the biggest and best-looking chart out of all other asset classes which is why we focused mainly on that position with our capital. See our trade below as it paints a clear picture.

TLT/Bonds historically show that when they rally 20% in price quickly the instantly reverse and crash. Well, our Fibonacci upside target worked out to be a 20% gain and if that level was reached we would close out any remaining position we had, which we did. During the rally, we scaled out of the position at 5%, 7.5%, 10% gain, and then the last portion once 20% was reached. The next day, TLT reversed and fall 15% over the next two weeks.

TD AMERITRADE TV CLIP

CLICK HERE TO WATCH VIDEO

Is This A Bear Market When Stocks Crash 20% and Bonds Spike 30%

It is another blood bath in the markets with everything down, including TLT (bonds) and gold. Safe havens falling with stocks is not a good sign as people are not comfortable owning anything, even the safe havens, and this to me is a very bearish sign.

Now, with that said, this is one day one of this type of price action and one day does not constitute a new trend or change the game, but if we start seeing more of this happen, we could be on the verge of the bear market we have all been expecting to show it ugly face.

The SP500 (SPY) is down 19.5% from the all-time high we saw just three weeks ago, and the general bias for most people is once the market is down 20% that is a new bear market. I can’t entirely agree with that general rule. Still, a lot of damage is happening to the charts. If price lingers down here or trades sideways for a few months I will see it as a new bear market consolidation before it heads lower, and we start what could be very deep market selloff and test 2100 on the SP500 index (SPY $210) for the next leg down looking forward several months.

20% STOCK MARKET CORRECTION ARE NOT BEARISH

Just because the markets have a deep correction of 20% does not mean its game over for stocks. Just take a look at the chart below on what happened the last time the market corrected 20%. As you can see, they were the biggest and best investor opportunities over the past 12 years. Today, my friend called and said they heard on the news that we are now officially in a bear market, and what should he do?

20% CORRECTIONS CAN TURN INTO A BEAR MARKET – BE READY

The SP500 fell 20% in 2001 and again from the 2007 high its lows, then bounce 10% – 14 over the next few months before rolling over to start its first bear market leg. I feel something similar will happen this time, which would put us a few months before the price should test these lows again and breakdown to give us optimal time to reposition our long term portfolio.

Once we do start a bear market, you will notice price moves very differently from what we have experienced over the past 12 years. How you trade now likely will be a struggle to make money. If you try to trade bonds, they are relatively tricky because of how they move during a bear market. The stock market can fall for a year, and bonds are still trading at or below the price they were when the bear market started. This different price action is what happened in 2001-2002, and again in 2008.

BONDS GO BALLISTIC

Bonds also take on the price action similar to how the VIX trades with violent price spikes only to fade back down again quickly, and this generally happens near the end of a bear market, or extreme selloff like we are in now. Heck bonds (TLT) jumped 30% just in the past few weeks, we caught it, but most traders missed this move. You need to understanding market sentiment and how to trade bear market type price action because that is how the market is moving this week, and trading/chart patterns become more sentiment-driven than logical trading setups and trades become counterintuitive.

I also traded GDXJ for a 9.5% gain and closed that position at open for the high tick with my followers, and we didn’t follow my proven trading rules for price targets, trailing stops, and reading the market sentiment we could be down over 30% today which I know many traders are simply because they lack control of their trading (no defined rules, fall in love with positions). I’ll be doing a detailed gold and gold miners article so stay tuned!

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

CONCLUDING THOUGHTS:

I share this analysis, not to scare you, but let you know where we stand. The stock market is treading on thin ice, and if/when it breaks down, a new bear market will have started. Remember, we are still in a bull market, but the coronavirus is stopping businesses, which means earnings will be poor, and that is why stocks are falling. Investors know stocks are worth less money if they make less money; it is that simple.

The type of market condition I think we have entered could be here for a while, a year or three, and it’s going to be a traders market, which means you must have a trading strategy, plan your trades, and trade your plan. It’s amazing how simple a few trading rules are written down on paper can save you thousands of dollars a year from locking in gains, or cutting losses. I have this mini trading strategy mastery course if you want to take control of your trades and override your emotional issues. It’s easy to hold winners until they turn into losers, taking to large of a position, or maybe you have masted the art of buying high and selling low repeatedly? Yikes! It happens to most traders, and it can easily be overcome with a logical game plan I cover in the crash course, pun intended 🙂

Someone yesterday I spoke with said that in the USA alone already had 10,000 people die just from common influenza, yet here we are freaking out over 17 dead in the USA. Sure, its bad news, but the common sicknesses for older citizens makes coronavirus seems a little blown out of proportion. There are conspiracy theories out there and this could be bioweapon which is scary and I am no expert in this field but my sources are not concerned with the Conornavirus. I want to think a cure gets found soon, and if so, the markets will rebound with a vengeance, and we can relax.

In short, if you have lost money with your trading account this year, holding some big losing trades that were big winners just a couple of weeks ago, I think it’s worth joining my trading newsletter so you can stay on top of the markets. I take the loud, emotional, and complex market and deliver simple common sense commentary and a couple of winning trades each month.

My trading is nothing extreme or crazy exciting because I’m not an adrenaline trading junky. I only want to grow my entire portfolio 2-4% a month with a couple of conservative ETF trades and make a 22%-48% return on my capital without the stress of being caught up in this type of market and feeling like I always need to be in a trade.

Happy Trading!

Chris Vermeulen
Chief Market Strategist
www.TheTechnicalTraders.com

A Bullish Trade In Commodities

Chris Vermeulen, Founder of The Technical Traders joins me to focus on a couple of commodities sectors. We start off with oil and a level that Chris is watching closely to buy. Then we look at the precious metals.

3 DAYS LEFT TO GET YOUR FREE SILVER ROUNDS WITH SUBSCRIPTION!

We continue to see money flow into the safe-haven assets like the Utility sector, bonds, and most importantly precious metals. I anticipated this and our XLU utilities ETF taken with members for 4.4% already, and our VIX ETF trade we closed for a 25% last week.

For May 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:

SUBSCRIBE TO MY TRADE ALERTS AND GET FREE SILVER ROUNDS!

Chris Vermeulen

Stocks Topping, Dollar Up, Gold Getting Closer

Chris Vermeulen joined us today. He believes that the stock market is topping out if it hasn’t already. This will lead to increased volatility and a move back to safe haven assets, i.e. gold. He believes that oil will break down briefly into the ’50s and then come roaring back shortly thereafter. The bigger and faster the decline, the fast the bounce back. Interest rates are headed lower.

 Click Here to Listen to the Audio

 

How Sustainable Is The Move Into Safe Havens?

Chris Vermeulen. Founder of The Technical Traders joins me to share his thoughts on the recent flow of money into safe haven assets. During the selloff, yesterday in US markets money moved into bonds, gold, and back into the USD. We discuss just how long this run could last and which sectors Chris is the most bullish on.

This is proving to be an incredible trading year for traders who follow our trade alerts newsletter.

For active swing traders, you are going to love our daily trading analysis. On May 1st we talked about the old saying goes, “Sell in May and Go Away!” and that is exactly what is happening now right on queue. In fact, we closed out our SDS position on Thursday for a quick 3.9% profit and our other new trade started Thursday is up 18% already.

Second, my birthday is only three days away and I think its time I open the doors for a once a year opportunity for everyone to get a gift that could have some considerable value in the future.

Right now I am going to give away and shipping out silver rounds to anyone who buys a 1-year, or 2-year subscription to my Wealth Trading Newsletter. I only have 3 left as they are going fast so be sure to upgrade your membership to a longer-term subscription or if you are new, join one of these two plans, and you will receive:

1-Year Subscription Gets One 1oz Silver Round FREE
(Could be worth hundreds of dollars)

2-Year Subscription Gets TWO 1oz Silver Rounds FREE
(Could be worth a lot in the future)

I only have 3 more silver rounds I’m giving away
so upgrade or join now before its too late!

SUBSCRIBE TO MY TRADE ALERTS AND GET YOUR FREE SILVER ROUNDS!

Happy May Everyone!

Chris Vermeulen