One type of Fibonacci price structure we use to attempt to measure price trends and identify potential tops/bottoms is the “100% Measured Move” structure. This is a price structure where a previous price move is almost perfectly replicated in a subsequent price trend after a brief period of retracement or price correction. These types of patterns happen all the time in various forms across multitudes of symbols to create very solid trading signals for those that are capable of identifying trends and opportunities using this technique. If you want my daily analysis and trade ideas, be sure to get my updates by joining my free trend signals email list.
The first thing we look for is a strong price trend or the initially confirmed reversal of a price trend. We find that these trending price ranges and initial “impulse trends” tend to prompt 100% measured moves fairly accurately. The explosive middle-trend is where one can’t assume any type of Fibonacci 100% measured move will happen. Those explosive moves in a trend that tend to happen in the middle of a price trend are what we call the “expansion wave” of a trend and will typically be 160% or more the size of the initial impulse trend.
These trade setups we call the “100% measured moves” are naturally occurring price rotations that skilled traders can use to identify strong trade potential setups. They are more common in rotating markets where a moderate trend bias is in place (for example in the current YM or ES chart).
First, let’s take a look at this YM Weekly Chart to highlight the most recent 100% Measured Move. The original upside price move between June 2019 and July 2019 resulted in a 2787 point price rally that replicated between August 2019 and November 2019 – after a brief price retracement. Currently, price is rotating near the peak of this 100% measured price move near 27,875 while attempting to set up a new price trend.
In this ES Weekly example chart, we see a 100% Measured Move that originated in June 2019 and ended in July 2019 – just like on the YM chart. Although the completion of the 100% measured move didn’t originate until the low that formed before price rallied to take out the previous high near 3029.50. Remember, the other facets of Fibonacci price theory are also still at play in the markets while these 100% Measured Moves are taking place. Thus, rotation between a previous price peak and valley (without establishing any new price highs or new price low) are considered “price rotation” – not trending. The 100% Measured Move that did take place recently did complete a full 100% advancement and is now stalling near the 3040 level peak.
SP500 INDEX TREND IDENTIFICATION AND TRADE SIGNAL SYSTEM
CYCLE AND PRICE PREDICTION SYSTEM
CONCLUDING THOUGHTS:
Once these 100% measured moves complete, price usually attempts to stall or wash out a bit before attempting to establish a new price trend. At this point, given the examples we’ve illustrated, we believe the US market will enter a period of rotation and moderate volatility as these 100% measured moves have completed the upside price advance for now. Some level of price rotation after these 100% measured moves have completed will potentially allow for another attempt at a future 100% price advance after setting up a new price leg.
These techniques don’t always work, we recently got stopped out on a TVIX (vix/volatility trade for a loss) but we just close out our thirst natural gas trade for a quick 7% profit. The previous UGAZ trade netted 20%, and the one before that was 7.95%.
I can tell you that huge moves are about to start unfolding not only in metals, but stocks, and currencies. Some of these supercycles are going to last years. Brad Matheny goes into great detail with his simple to understand charts and guide about this. His financial market research is one of a kind and a real eye-opener. PDF guide: 2020 Cycles – The Greatest Opportunity Of Your Lifetime
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.
I urge you to visit my Wealth Building Newsletter and if you like what I offer, join me with the 1 or 2-year subscription to lock in the lowest rate possible with our BLACK FRIDAY offer, PLUS get a FREE BAR OF GOLD and ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next set of crisis’.
https://thegoldandoilguy.com/wp-content/uploads/2019/11/31.png456850adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-11-28 11:16:172019-11-28 11:16:17100% Measured Moves May Signal A Top
As we close out the week and watched the markets trade in a rotational price manner, it became very clear to us that the patterns setting up in price continue to support our overall analysis of the markets and the potential for a bigger downside price move. We issued a call that an August 19th breakdown was expected on or near the trigger date (Aug 19th). We’ve taken some heat from our followers and readers regarding this call and the fact that the markets have yet to really breakdown below current support levels.
As we’ve learned from our experience and previous analysis/calls – the markets can continue to act in ways that run counter to our analysis for much longer and in a much more irrational manner than we can survive the risks associated with any irrational price moves. Yet, at this point, we don’t see anything irrational in the markets – we see opportunity.
Our last few trades for our members have been incredible successes – totaling more than +30% over the past 5 trades. We believe our research team and proprietary price and predictive modeling systems have clearly identified price weakness in the markets. Until price confirms otherwise, our believe is that price will attempt to move lower – establishing new lows. Before we get into the details, be sure to opt-in to our Free Market Forecast and Trade Ideas Newsletter
Important Japanese Candlestick Reversal Patterns
The Doji Star and Shooting Star Japanese Candlestick patterns are part of a unique group that identifies potential price reversals, support/resistance and can often build into other types of patterns. Our belief is these setups in the current chart will eventually create an Evening Star formation with a downside price move early next week. This type of pattern would confirm resistance near the body of the current Doji or Shooting Star candlestick and also confirm our analysis that a price breakdown should continue.
SP500 – ES Daily Chart Highlights the Doji Reversal Pattern
This ES Daily chart highlights the Doji pattern created by the close of Friday trading near 2923.75. The fact that price narrowed on Friday into a Doji pattern forming below the previous highs suggests general weakness in price and a possibility that early next week we may see price breakdown to complete a Harami or Doji Star Reversal Pattern.
Dow Jones – YM Daily Chart Highlights the Doji Star Reversal Pattern
This YM Daily chart shows a similar pattern – another Doji Star setup. The Doji pattern sets up right at a key resistance level, near 26,400, and aligns with other chart and patterns to warn that price may weaken into a strong Candlestick reversal pattern. All it would take is for the price to move below 26,000 and begin a new downside leg.
Transportation – TRANS Daily Chart Highlights the Shooting Star Reversal Pattern
This TRAN chart shows a true Shooting Star pattern. The unique shape of the Inverted Hammer candlestick (part of the Umbrella Group) shows clearly. The gap between the last to candlestick bodies sets up the Shooting Star pattern. This is a classic Top Reversal setup. Found at this point in price action suggests price may be set up for a big breakdown. At the very least is shows clear resistance is at 10,130 and that we must be aware that price was rejected at this level.
Financials – XLF Daily Chart Highlights the Doji Start Pattern
Lastly, this XLF Daily chart shows a true Doji Star pattern where a Doji candlestick sets up with a gap between the real bodies of the last two candlesticks. Again, this pattern sets up just below $27 which has continued to operate as strong resistance. Any breakdown in this sector early next week will confirm this pattern and set up a Three River Evening Star pattern – a Sell Signal.
CONCLUDING THOUGHTS:
Every one of these patterns provides a clear definition of resistance and also show price weakness set up near the end of last week. At this point, we are just waiting to see what happens early next week after a long holiday weekend. Based on our past research, we believe the downside potential far outweighs the upside potential – unless some major news event pushes the price much higher – like the news of the new US/China trade talks.
We would advise traders and investors to take advantage of these higher prices to pull profits out of open long positions and take some risk off the table at this juncture in price. We entered a new trade today and our portfolio is primed and ready for big moves going into next week.
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.
Everything in the world goes through cycles including investors level of fear, and stock prices. In this report, I want to show you how you can identify short-term and longer-term market tops and bottoms using technical analysis that focuses on the most active time cycles in the stock market today.
Before we get into the details here I would like to touch on two myths that you as a trader need to know in terms of average profit per trade and the number of trades needed to be highly profitable. It’s not what you may think.
Myth #1: You Must Always Be In A Trade and Trading
You don’t need to trade every week, or need to always be in a position. This is a huge misconception and something that most traders struggle with grasping. The reality is, the fewer the trades you make less likely you are to lose money. For example, over the past 17 months, I have placed 53 trades which works out to only 3 trades a month, not many. With those 53 trades, our entire portfolio is up 74.9%. Ya, a whopping 75% with only a few simple trades a month and if you calculate what the average percent return is then you get a taste of trading reality, which brings us to the topic 2.
Myth #2: You Need 8%-25%+ Profit Per Trade to Make Big Profits Average percent return per trade is another thing most traders have completely backward. If you take 74.9% divided by 53 trades you get 1.41% average return per trade. WOW, that’s low, right? Ya, it seems low, but that’s the reality of trading. The markets wiggle up and down 1-5% regularly and you cant perfectly nail every top or bottom, and sometimes a nice trend trade is completely wiped out in 1-3 days from a flash crash type of sell-off and we have seen a few of those in the past year. What you are left with is the safe middle 1%-3% each trade, and these trades are the norm. But with that said we still have some 5-10% losing trades, and some 20-45% winners pickled in there which is always exciting.
My point on these two topics is for everyone to stop thinking you always need to be trading and think every trade should make 10-20% profit or it’s not worth your time and money.
I get emails all the time from traders who demand 5+ trades a week, expect big gains on every trade, and they usually have a story to share about how they recently lost a boatload money trading some 3X ETF with nearly their entire portfolio in one position and they need my help for some big trades to make it all back.
Yes, I can help, Yes it’s possible we get a couple of big trades that could do this, it happens, but we don’t know exactly when or which trade it will be. You must put in our time, trade cautiously and the big wins will happen over time.
Traders like this most definitely need some help because if they don’t start trading properly soon enough they will take a big loss, give back months/years of hard work, or blow up their account altogether. Trust me I have been there done that three times when starting out. Losing everything three times is a very sobering experience but sometimes it is the only way to learn if you don’t find the right mentor or trading newsletter to follow. Focus on building your account and wealth over time, not in a few fast-moving stocks/ETF trades.
SP500 DAILY CHART & CYCLE ANALYSIS
This chart is a little cluttered but if you look at the bottom of the chart where my cycle tool is located you will see how different cycles have different strengths and form short term tops and bottoms.
They key focus should be on the three larger RED shaded areas, and the one large GREEN shaded area. Those are what I call Cycle Clusters. When all three cycles are in the overbought or oversold zone we should expect weakness for 3-6 days.
The light blue cycle when trading in the overbought or oversold zone can be used for re-entry or adding to positions in favor of the overall trend (up or down).
By having this technical trading tool we are able to scale in and out of the market for increased profits while reducing our portfolio risk.
This cycle tool is something subscribers to my Wealth Building Newsletterwill have access to in the very near future including my complete entry, targets, and stop alerts. By following all the key markets we will have a steady stream of trades each month for increased profits.
DAILY VIX CHART AT SUPPORT & CYCLE CLUSTER
I decided to pull some VIX analysis into this research simply because the VIX recently tagged a critical support level as shown on the chart below, along with a cycle low cluster. Both of these things occurring could mean stocks are set up for a deeper than normal correction in the very near future.
The VIX at times can act as a crystal ball during times of extreme fear or complacency. Currently, complacency is the signal with traders and investors having no fear of falling prices.
The VIX is a contrarian indicator with the old saying “When the VIX is high its time to buy, with the VIX is low its time to go”.
Based on the options market for VIX puts and calls traders are expecting the VIX rise over than a couple of days and even a month from now.
30 MINUTE CHART & CYCLE PREDICTION
If we take the analysis one step further, we can zero in on the 30-minute regular trading hours only chart (9:30 am ET – 4 pm ET) with our blended cycles price bias for a better feeling of where the price is wanting to go over the next 3-6 days.
Based on the SP500 index cycles, coupled with the VIX cycles and test of support the intraday analysis looking forward 3 days looks to be in line with the other trading tools.
FUN FACTS FIFTEEN 5% WINNERS COMPOUNDED = 107% ROI $500 PROFIT PER/MONTH = 30% ROI WITH $20K ANNUALLY POSITION SIZING = TRADING SUCCESS
While there are hundreds technical indicators and thousands of ways to try and read, time, and trade the stock indexes I have developed my own way to spot stock index tops and bottoms using this special cycle tool. I should note that this works exceptionally well with gold, gold miners, silver, and oil.
IN CONCLUSION:
In short, expect stocks to trade sideways or lower this week and for the VIX to work is way higher.
We’ll keep you informed as this plays out with Wealth Building & Global Financial Reset Newsletter if you like what I offer, join me with the 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. Join Now and Get a Free 1oz Silver Round or Gold Bar Shipped To You!
I can tell you that huge moves are about to start unfolding not only in metals, or stocks but globally and some of these super cycles are going to last years. A gentleman by the name of Brad Matheny goes into great detail with his simple to understand charts and guide about this. His financial market research is one of a kind and a real eye-opener. 2020 Cycles – The Greatest Opportunity Of Your Lifetime
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.
IM GIVING THEM AWAY WITH 2-YEAR MEMBERSHIPS
So kill two birds with one stone and subscribe for two years to get your FREE GOLD BAR and enough trades to profit through the next metals bull market and financial crisis!
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Last week was a great week for trading as we locked in profits on a trade and raised our stops to protect the rest of our open positions.
take a look at how my trading system identifies trends, trades, and targets in the chart below.
If you want to become profitable technical traders join my educational trading newsletter and trade alerts complete with entry, targets and stop pricing.
Today we closed two winning trades at the open, and entered a NEW trade this morning markets are getting very tradable again. So ride my coattails as I navigate these financial market and build wealth while others lose nearly everything they own during the next set of crisis’.
Soon I will be adding this trading system chart in the member’s area where it updates through the day for you to follow alone and trade with me. I should mention that the newsletter pricing will be going up soon. If you subscribe before the price increase you are grandfathered in at the old/lower rate.
EDIT: September, 26, 2019. New Terms and Conditions are in effect. Grandfathered rates may no longer apply. Please read the Terms and Conditions available on the sign-up page of www.thetechnicaltraders.com.
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If you wanna become a technical trader with use and trade ETFs then be sure to join our Wealth Building Newsletter today and get our daily video analysis and swing trade alerts. In the past 17 months, our newsletter trade signals have generated 91% ROI for its subscribers, be sure to join before the markets start making new big moves and profit with us!
Chris Vermeulen
www.TheTechnicalTraders.com
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