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100% Measured Moves May Signal A Top

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.

If you are not familiar with some of my forecasting and trading strategies for trading the S&P 500, or my gold trading signals be sure to click those links to see some pretty interesting charts like these.

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’.

Chris Vermeulen
www.TheTechnicalTraders.com

Market Fears and Flash Crashes

I want to wish everyone a Happy Thanksgiving and if you find this type of analysis interesting be sure to visit my website and sign up to get both my swing trade and investing analysis.

ETF trade signals at 41% discount, plus a free bar of silver or gold
Black Friday Offer Today! 

Visit: www.TheTechnicalTraders.com

Chris Vermeulen
Technical Traders Ltd.

The Bond Market Is Telling Us Some Weakness Could Be Entering The US Markets

Chris Vermeulen joins me to look at the charts for US markets, bonds, gold, and natural gas. He points out that bonds have rebounded and are showing that some of the smart big money is taking a more defensive position. However gold is lagging the moves in bonds. Also considering where the VIX had dropped to we could finally see a US market correction that could bring some fear back into investors’ minds.

I want to wish everyone a Happy Thanksgiving and if you find this type of analysis interesting be sure to visit my website and sign up to get both my swing trade and investing ETF trade signals at 41% discount, plus a free bar of silver or gold with my Black Friday Offer Today!  Visit: www.TheTechnicalTraders.com

Chris Vermeulen
Technical Traders Ltd.

Adaptive Predictive Modeling Suggests Weakness Into 2020

Our Adaptive Dynamic Learning (ADL) predictive modeling system is suggesting the Transportation Index will fall to levels near $10,000 over the next 2 to 3 weeks which would indicate moderate price weakness in the US stock market and the global stock market.

Our ADL predictive modeling system attempts to model future price activity by finding and mapping critical price and technical elements within the historical price action.  In a way, this is like mapping the future by attempting to learn from the past. You can get all of my trade ideas by opting into my free market trend signals newsletter.

WEEKLY TRANSPORTATION INDEX CHART #1

This first Weekly Transportation Index chart highlights the ADL predictive modeling results since the end of July 2019.  Notice the CYAN and YELLOW lines drawn on this chart showing what the ADL predictive modeling system suggested would happen over time.  This Technical ADL pattern consisted of SIX historical reference points and suggests the last three weeks’ price levels have a 63 to 84% probability rate.  This would indicate a fairly strong probability that prices will fall as the ADL predicts.

WEEKLY TRANSPORTATION INDEX CHART #2

This second Weekly Transportation Index chart highlights the ADL predictive modeling results from early September 2019.  The results are quite similar across these two charts.  Although the September results highlight a bit more potential price rotation than the earlier July ADL results.

This September ADL predictive modeling chart suggests the TRAN price will fall dramatically to levels below $10,000, then recover a bit.  After that, the price will continue to settle near the $9,700 to $10,000 level throughout the end of 2019.  This downside price move in the Transportation Index suggests the US and Global markets will experience some extended price weakness over the next 3 to 6+ weeks.

The decline in the Transportation Index suggests an overall weakness in the global economy.  If that translates into true price action in the global markets, we could see a series of lower lows set up in the US Stock Market over the next 4 to 6+ weeks.

General price weakness may become a waning anthem for the global stock market headed into the start of 2020.  Take a look at this NQ (Nasdaq) Weekly ADL chart to see what our predictive modeling system is suggesting will happen over the next 60 to 10+ weeks.

If our ADL predictive modeling system is correct, the NQ will fall to price levels near or below $7,700 over the next 2 to 4+ weeks before attempting to settle near $8000 near the end of 2019.  A couple of days ago I shared an interesting article talking about the VIX ready to rocket higher which is linked to this pending decline. As a word of warning, the price can, and often does, move beyond the ADL predictive levels on extended/volatile price swings.  So be prepared for what may happen as price rotates.

As we are nearing the US Thanksgiving holiday weekend, we wanted to alert you to the fact that we’ve created incredible Black Friday membership subscription options for all of our followers to take advantage of.  These special savings rates will run through the end of November – so don’t miss out by joining the Wealth Building Newsletter right now!

Chris Vermeulen
Technical Traders Ltd.

Oil Begins To Move Lower – Will Our Predictions Come True?

Recently, we posted a multi-part research post suggesting a collapse in Crude Oil could be setting up and how we believe this decline in energy prices may lead to a broader market collapse in the near future.  Crude oil fell more than 3% on November 19 in what appears to be a major price reversal.  On November 20, inventory levels and other key economic data will be presented – could the price of oil collapse even further over the next 60+ days?

Here is a link to our most recent multi-part article about Crude Oil from November 13 (just a week ago): https://www.thetechnicaltraders.com/what-happens-to-the-global-economy-if-oil-collapses-below-40-part-i/

OUR ORIGINAL RESEARCH CHART FROM JULY 2019

Our original research post, from July 2019, included this chart showing our Adaptive Dynamic Learning (ADL) price modeling system and where it believed the price of oil would go in the future.  This chart highlights expected price ranges and directions all the way into April 2020 with a low price level near $25 somewhere between February and April 2020.  Is Oil really going to reach a low price near $25 ppb in the near future?

On July 10, 2019, we authored a research article using our ADL predictive modeling for Oil.  At that time, we predicted Oil would fall in August, recover in September and October, then collapse to near $42 (or lower) in November and December.  You can read our followup to this article here.

In order for these predictions to continue to hold true, Crude Oil will have to fall below $47 ppb over the next 30+ days and then consolidate through December and January into a fairly tight price range between $42 and $49.  If this happens as we predicted back in July, then there would be a much higher probability that the February, March and April price targets are valid going forward.

On November 19, Crude oil reversed quite extensively to the downside after weeks of upward price pressure.  We believe this downside price rotation may be setting up a bigger, deeper price move that is aligned with our ADL predictive modeling systems results from July 2019 – eventually targeting the sub $50 price level near the end of November or early December. You can get all of my trade ideas by opting into my free market trend signals newsletter.

CONCLUDING THOUGHTS:

This potential move in Crude Oil is setting up a potentially great trade for active traders if you know how to profit from falling prices and I even talked about how to trade this move in my member’s only trading newsletter service. Remember, if our ADL research is correct, December and January will see very mild price action in Oil.  The bigger breakdown move happens in late January or early February.

On Monday another commodity gave us another trade and it popped 3.4% in our favor within the first trading session. Big moves in stocks, metals, and energy are ready for big price swings here, get ready!

As a trader, you need to be aware of the greater implications for the global markets if Crude Oil falls below $45 ppb (eventually, possibly falling below $30 ppb).  A large portion of the global market depends on oil prices being relatively stable above $50 ppb.  A decrease in oil prices will place extreme pressures on certain nations to maintain oil production and to generate essential revenues.  Depending on how this plays out in the future, falling oil prices could translate into far greater risks for the global stock markets and global economics.

Chris Vermeulen
Technical Trader Ltd.

What happens To The Global Economy If Oil Collapses – Part 3

This, the final section of this multi-part research article, will continue our exploration of the consequences that may result from our ADL predictive modeling system’s suggestion that Oil may continue to fall to levels below $40 over the next few months.

In Part I and Part II, we’ve highlighted what we believe to be very compelling evidence that any continue oil price decline from current levels may be setting up the global markets for a massively volatile price reversion – similar to what happened in 1929.

Prior to the stock market collapse in 1929 and the start of the Great Depression, commodity prices collapsed in 1921 and again in 1930.  This commodity price collapse was the result of over-supply and a dramatic change in investor mentality.  The shift away from tangible items and real successful investing/manufacturing and towards speculation in the housing markets and stock market.

Today, we want to focus on some of the core elements of our current global economic structure to attempt to present any more compelling evidence of a commodity collapse event that may happen after the past 7+ years of a massive credit market expansion event.  Allow us to briefly cover the events of the past 20 years.

You can get my daily market analysis articles and trade ideas by opting into my free market trend signals newsletter.

1999: the DOT COM bubble burst after a mild recession in 1993-94 and a stock market rally from 1996 to 1999

September 11, 2001: Terrorist Attack on US soil.  Shocked the world and global stock markets.  Sent the world’s economy into severe contraction. US Fed lowered interest rates from 6.25% to 1.0% from 2001 to 2003.

2004-06: US Fed begins raising rates from 1.0% and gradually increased rates to 5.25% in August 2006: +525%.  Pushing the US credit market, and housing market, over the edge and starting the 2008 Credit Crisis.

2007-2008: US Fed lowered interest rates to near ZERO over a very short 16-month span of time as the US Credit Crisis event unfolded.

2009-15: US Fed continued to keep interest rates near zero throughout this time-frame and continued to pump capital in the global capital markets with multiple QE and debt buying events.  Other global central banks followed the US lead providing additional capital throughout the global markets.  This massive expansion of credit/debt over a 7+ year span of time allowed foreign nations to “binge” on cheap US and Euro credit/debt while an Emerging Market and Foreign Market recovery were taking place.

2016-2019: US Fed raised interest rates from 0.08% to 2.42% over this span of time. Pushing US Fed rates up by the highest percentage levels EVER: +3025%

This continued global cycle of “boom and bust” has wreaked havoc on global consumers and business enterprises.  Over the past 20+ years, various cycles of economic appreciation and depreciation have left some people considerably better suited to deal with these cycles while others have been completely destroyed by these events.  Now, it appears we are entering another period of “early warning” as global manufacturing activity, growth and economic output appears to be waning. Are we entering another period like the 1929 to 1940 period of the US where a global economic contraction resulted in a deeper economic recession/depression and took 15+ years to recover from?

The US Fed has recently started acquiring assets again – at a far greater rate than at any time since 2012.  It is very likely that the US Fed is “front-running” a crisis event that is already starting to unravel again – possibly aligned with institutional banking entities and global credit/debt risks.

Chinese factory orders have continued to fall recently and the news is starting to trickle out of China that the US trade tariffs have done far greater damage than currently expected.  This suggests that manufacturing, exports, and GDP for China have entered a massive decline.  What happens next is that commodity prices collapse because of the lack of demand from manufacturers and consumers. (Source: https://www.yahoo.com/finance/)

Chinese new loan origination rates have fallen to a 22 month “new low” – which suggests corporate and consumer borrowers are simply not willing to take on any new debt/credit at the moment.  This happens when a population decides they want to “disconnect” from any economic risks and shift towards a “protectionist” process. (Source: https://finance.yahoo.com)

Recent news suggests that Chinese demand for European consumer and luxury goods has also contracted dramatically.  Germany will release GDP estimates on November 14th.  It is our opinion that the Chinese have already shifted into a more protectionist consumer stance and that would mean that demand for non-essential items (call them high-risk purchases) are very low at this time.  If this is the case, the lack of true demand origination out of China/Asia could push much of Europe into a recession. (Source: https://www.yahoo.com/)

The last thing China would want right now is to blow the potential for any type of US/China trade deal – even if it means giving up more than they may have considered many months ago.  More tariffs or any type of tit-for-tat retaliatory trade war would not be in the best interest of either party at this stage of the game. Who flinches first? The US, or China, or the rest of the world?

So, the question, again, becomes..  “will a commodity collapse lead the global stock market into a prolonged period of price decline and/or a global recession over the next 10+ years?”

If so, can we expect commodities to collapse as they did after the 1929 stock market peak?

You may remember this chart from the earlier sections of this multi-part article.  It highlights what happened leading up to the 1929 stock market crash and how early warning signs of manufacturing and agriculture weakness continued to plague the markets while speculation in housing and the stock market pushed certain asset values much higher near the end of the “Roaring 20s”.

Are we setting up for the same type of event right now where global trade, manufacturing, and agriculture are weakening after the 2008 Credit Crisis and we are meandering towards a repetition of the events that led to the “Great Depression”?  Will commodities prices collapse to 2002 or 2003 levels for most items?  Will Oil collapse to levels below $30 ppb over the next 6 to 12+ months?  And what will happen to Gold and Silver throughout this time?

Can we navigate through these troubling events without risking some type of new collapse event or reversion event?  Are the central banks prepared for this?  Are traders/investors prepared for this?  Just how close are we to the start of this type of event?

The answers lie in what we do now and how the commodities react over the next 12+ months.  The one major difference between now and 1929 is that the world is far more inter-connected economically and there are more people throughout the world that have moved into the “economic class”. Thus, it is our opinion that any event that is likely to happen will be followed by a moderately strong recovery event – no matter how severe the outcome. The world is in a different place right now compared to 1929.  Overall, only time will tell if our research and ADL predictive modeling system is accurate with respect to future oil prices.

We believe it is critical for all traders to understand what lies ahead and the risks involved in “playing dumb” about the current market environment.  We recently authored an article titled “Welcome to the Zombie-land for investors” and highly suggest you read it. Our researchers will share this one component that should help to ease some of the stress you may be feeling right now – the most capable, secure, mature and best-funded (reserves) economies on the planet will likely lead any recovery process should an event as this happen.  Therefore, look for strengths in the most mature and capable economies on the planet if some new crisis event begins.

Even if a trade deal between the US and China were to happen today and eliminate all trade tariffs, would this change anything or would this simply pour fuel onto the “capital shift” fire that is already taking place with speculation reaching frothy levels?

If you want to earn 34%-50% a year return on your trading account with very few ETF trades then join me at the Wealth Building Newsletter today!

Chris Vermeulen
www.TheTechnicalTraders.com

What happens To The Global Economy If Oil Collapses Below $40 – Part I

Currently, commodity prices are the cheapest they’ve been in over 40 years compared to equity prices.  US Equities have continued to rise over the past 7+ years due to a number of external processes.  QE1, 2, 3, and Fed Debt Purchases Share Buy-Backs and creative credit facilities.  Only recently have investors really started to pile into the US stock market (see charts below). Global investors were very cautious throughout the rally from 2011 to 2016.  In fact, the amount of capital invested within the US money market accounts was relatively flat throughout that entire time.

It was only after the 2016 US presidential election that investors really began to have confidence in the global economy and started piling into the US stock market and money market accounts.  This was also after the time that Oil began to collapse (2014~16) as well as the deflation of Emerging Markets rallies.  With all this new money having entered the global markets and equities being extremely overbought currently, what would happen is Oil collapsed below $40 and the global economic outlook soured headed into the 2020 US presidential election?

On July 10, 2019, we authored a research article using our ADL predictive modeling for Oil.  At that time, we predicted Oil would fall in August, recover in September and October, then collapse to near $42 (or lower) in November and December.  You can read our followup to this article here.

Currently, Oil has followed our ADL predictive modeling relatively closely over the past few months.  Although the attack in Saudi Arabia sent prices skyrocketing in mid-September, Crude price has generally stayed within our expected ranges and has recently settled near $55.  If you notice the two GREEN BARS on the chart, above, September and October price expectations suggested price settling near $54 and 59 throughout those two months.  Now, with November upon us, the ADL predictive modeling system is suggesting Oil prices will collapse from levels near $58 to levels near $40 – a massive 31% price collapse.  In reality, the price could fall below on a deeper price decline event.

This Crude Oil chart highlights what we believe may happen in Oil over the next few weeks and months – where price may collapse below $40.  Yet, we started asking another question..  What happens to the global economy if Oil prices collapse below $40 before the end of 2019?  What happens to the nations that depend on exported Oil income and to central bank functions within the economy?

When we start to understand the correlation between the price of Oil and the expectations throughout the global market, we must immediately focus on the income expectations of nations that rely on oil as the main source of income.  If our ADL predictions are correct, Oil will begin to plunge to levels near $40 (possibly below $40) over the next 3~4 months.  How will foreign nations react to this loss of income and who are the most dependent nations on Oil revenues.

Oil-producing nations vary in scale across the world, yet the United States, Saudi Arabia and Russia are the largest producers.  Nations that are the most dependent on Oil revenues are some of the smaller, less mature economies of the world.  Should the supply of oil stay relatively consistent across the globe while an extended economic contraction continues, we must begin to question the sustainability of various nations in terms of oil revenues.

For many of these nations, the income from Oil exports make up more than 15% of their annual GDP – in some cases, with Brunei, Kuwait, Libya, the Republic of Congo, Saudi Arabia and Singapore, oil revenues make up more than 30% of GDP.  How would a dramatic decrease in oil prices act as an economic destabilization event for these nations? Could they survive the event?

If the price of oil were to fall to $40 from current levels (near $67), this would represent a 40%+ price decline.  Oil revenues for all nations would likely collapse by similar amounts.  Nations that are most dependent on oil revenues would be hardest hit and this decrease in national revenue would likely increase strains on future operations, debt/credit as well as potentially create massive social unrest and strife.

If our ADL predictive modeling system is accurate and oil prices collapse to near $40, the economic, social and future strains this creates for many nations become even more severe – at a time when an economic contraction is taking place.  This type of commodity price collapse could lead the world into a chaotic economic mess if it is prolonged.

In Part II of this article, we’ll explore the ramifications of this potential oil price collapse across the global stock market and other factors that may be setting up to drive a period of uncertainty and volatility within the global markets.

Opportunities are all around us.  Using the right tools to identify the true technical cycles, price cycles, and trading setup can help to eliminate risks and hone into more profitable trades.  It is almost impossible to time market tops and bottoms accurately, yet, as you can see from our work above, we have tools that can help us see into the future and help to predict when major price peaks and valleys should form.  Using a tool like this to help you determine when the real opportunity exists and when to time your trades will only improve your market insights and trading results….

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.

Chris Vermeulen
www.TheTechnicalTraders.com

How To Use Price Cycles And Profit As A Swing Trader – SPX, Bonds, Gold, Nat Gas

News does drive certain market events and we understand how certain traders rely on news or interest rates to bias their positions and trades.  As technical analysis purists, so to say, we believe the price operates within pure constructs of price rotation theory, trend theory, technical indicator theory, and price cycles.  We’ve found that technical analysis distills many news items into pure technical trading signals that we can use to profit from market swings.

Price is the ultimate indicator in our view.  Price determines current trends, support/resistance levels/channels, past price peaks and troughs and much more.  When we apply our proprietary price modeling and price cycle tools, we can gain a very clear picture of what price may attempt to do in the near future and even as far as a few months into the future.  Price, as the ultimate indicator, truly is the mathematical core element of all future price activity, trends, and reversions. Before you continue reading make sure to opt-in to our free market trend signals newsletter.

We have been using cycles since 2011 and have developed multiple proprietary price modeling tools over the past 5+ years that assist us in finding and timing great trades.  Most of what we have learned over the past 8+ years is refined into “experience and skill”.  When you follow the markets every day – every hour, for the past 8+ years and see various types of price and technical indicator setups and reactions, you learn to hone into certain setups that have proven to be highly accurate trading triggers.

Our research team had dedicated thousands of hours to develop the tremendous skills and experience to be able to produce accurate cycles, and to also interpret them, which is what we specialize in doing. Determining which cycles to trade may look simple, yet they are far from easy to trade without the setups and price rotation signals.

We use a blend of the top 4 active price cycles in the market which updates daily. This data allows us to know where future price is likely to move over the next few days and weeks.  Within this article, we’ll show you some of our proprietary price cycles and modeling tools to show you how we run some of our specialized trading tools.

SP500 DAILY CHART – PREDICTED PRICE MOVEMENT

This SPY chart highlights the short-term price cycle modeling system where you can see how price reacted in alignment with our proprietary cycle tool.  If you look into the future, you can see that our proprietary price cycle tool is predicting the SPY may cycle into a potential double-top type of formation before cycling lower approximately 8+ days into the future.  One thing to remember is these cycle levels do not predict price target levels.  Don’t look at this chart and the cycle tool lines as price objectives – they are just trending bias levels scaled from 0 to 100 – just like a SINE WAVE.  Ideally, in order to identify price targets, we must fall back to technical price theory and Fibonacci price theory in order to identify target price objectives for the top formation and the potential downside price trend in the future.

BONDS DAILY CHART – PREDICTED PRICE MOVEMENT

This BOND Daily chart highlights a different type of price cycle – a momentum base/bottom type of setup.  You can see from our proprietary cycle tool lines on the chart how price movement has aligned almost perfectly with the cycle forecast.  Also, please notice how the price has moved beyond cycle highs and lows at times.  This relates to the fact that we discussed above – that cycles do not predict price objectives.  On this chart, a longer-term momentum base/bottom setup appears to be forming over the next 8+ days where the Bonds may begin a new upside price trend after the base/bottom forms.  This would indicate that we should be looking for opportunities and price triggers that set up after the bottom has setup – not before.  If we time our entry properly, we may negate any real risk for a trade with Bonds.

GOLD MINERS DAILY CHART – PREDICTED PRICE MOVEMENT

This Daily GDXJ chart almost perfectly highlights how the cycles do not align with real price objectives.  Throughout most of this chart, you can see the cycle levels rotate higher and lower near the extremes while price rotated in a much more narrow range.  Still, pay attention to how our proprietary cycle tool nailed nearly every rotation in price.  The range of the cycle lines is indicative of the scale and scope of the total cycle event.  Bigger cycle ranges suggest deeper, more volatile price trending events.

Notice how the current cycle ranges are much more narrow than the previous cycle ranges?  This suggests the current price cycle event may be more muted and smaller in volatility than previous price cycle ranges.

Our proprietary price cycle tool is suggesting that GDXJ will rotate lower to setup a moderate-term price bottom before attempting to move higher over the next 8 to 10+ days.  The upside price cycle may be rather muted as well – possibly only targeting recent price peaks near $40~42.

NATURAL GAS DAILY CHART – PREDICTED PRICE MOVEMENT

As you can see our past cycle analysis has been extremely accurate. In, fact natural gas can provide some of the largest and quickest gains out of all asset classes we cover. In August we traded natural gas for a quick 24% profit, and in October we have already locked in 15% again.  Our remaining position in Natural Gas is up even more after this incredible upside move predicted by our cycle tool.

This chart presents a very good example of how our proprietary cycle tool can align with price perfectly at times.  In this example, the expected cycle ranges, which highlight the intensity and potential volatility of the price trends, aligned almost perfectly with the real price action.  Currently, the cycle tool is predicting a moderate price rotation in Natural Gas before a further upside price move hits.

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. PDF guide: 2020 Cycles – The Greatest Opportunity Of Your Lifetime

CONCLUDING THOUGHTS:

Opportunities are all around us.  Using the right tools to identify the true technical cycles, price cycles, and trading setup can help to eliminate risks and hone into more profitable trades.  It is almost impossible to time market tops and bottoms accurately, yet, as you can see from our work above, we have tools that can help us see into the future and help to predict when major price peaks and valleys may form.  Using a tool like this to help you determine when the real opportunity exists and when to time your trades will only improve your market insights and trading results….

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.

Chris Vermeulen
www.TheTechnicalTraders.com

Welcome To The Zombie-Land Of Investing – Part 2

In Part I of this research post, we highlight how the ES and Gold reacted 24+ months prior to the 2007-08 market peak and subsequent collapse in 2008-09.  The point we were trying to push out to our followers was that the current US stock market indexes are acting in a very similar formation within a very mature uptrend cycle.

We ended Part I with this chart, below, comparing 2006-08 with 2018-19.  Our intent was to highlight the new price high similarities as well as the price rotation similarities between the two critical peaks in market price. We are terming the current market a “Zombie-land” because it appears global investors are somewhat brain-dead as to the total risks that are setting up in the global markets right now. But, wait before you continue reading make sure to opt-in to our free market trend signals newsletter.

Forward guidance is waning. Earning expectations are decreasing.  Debt levels are skyrocketing all over the planet.  Global banks are continuing to move into more Quantitative Easing measures to attempt to spark growth.  The equity markets are 9+ years into a rally while the global central banks are 10+ years into some form of continued QE efforts.  Global economic data suggests a moderate downturn in economic activity and growth for many foreign nations.  We believe the next crisis will not originate in the US, but from outside the US.  We believe the risks associated with the massive debt levels in the foreign markets will be the reason for another price decline.  Quite possibly, a commodity price collapse (think OIL) will become the catalyst for this event.

IF OIL WERE TO FALL BELOW $45…

If Oil were to fall below $45 (eventually possibly flirting with the $30 price level) as our predictive modeling suggests, then we believe many foreign nations will suddenly become serious risk factor related to debt/credit and could potentially create a domino-process where the US/Global markets collapse on this new risk factor. Our last predictive model signal was for natural gas and we just close out the trade locking in 19% profits this week.

IS 2007 SETTING UP ALL OVER AGAIN?

But what if this is 2007 setting up all over again?  Take a look at the ES chart above – where a peak setup in May/June 2007, followed by a deep price correction.  Follow that price move even further to see how price rallied to a new all-time high throughout July, August and most of September before setting up in a deeper price rotation in late September and carrying forward into October.  Now, take a look at this current ES Weekly chart to see if there is any similarity between them.

GOLD UP 50% FROM ITS LOWS ALREADY

Gold has already rallied nearly 49% from the 2015 lows and the recent price rotation is somewhat similar to what happened to Gold in 2006-2007.  The extended base that set up between 2017 and 2018 could be interpreted as a similar type of base that set up in 2006-07.  The current rally is somewhat similar to what happened in late 2007 and early 2008 when the US stock market began to collapse volatility expanded in a strong uptrend which was followed by a moderate price retracement before Gold began a rally totaling more than 250% from the base/bottom.  Is this setup happening again right now?

WEEKLY NQ CHART SHOWS THE EXTENDED MELT-UP

This Weekly NQ chart shows the extended melt-up that is taking place after the October to December deep price rotation that took place in 2018.  We believe this deep price rotation is similar to the deep price rotation that happened between July and September 2007.  The subsequent “melt-up” process is a function of the “zombie-land” function of price and bias.  Investors chase after security and returns by pushing the price higher and higher when fundamentals and expectations don’t align with these expectations.  This same type of “zombie-land melt-up” happened in 2007 as well.

We understand the implications of this research post and want to warn all of our followers they need to be extremely cautious of the current market setup.  Even though the US stock market may continue an upside bias within a melt-up process, we believe there are very strong underlying risks in the markets that could prompt a very deep price correction.

THE US FED IS NOT LOWERING RATES BECAUSE …

The US Fed is not lowering rates because of market strength and super strong forward guidance.  They are lowering rates because they believe risks exist in the debt/credit market and are trying to stay ahead of a big problem – a potentially very big problem.  The overnight REPO market has been a topic for our researchers for the past 45+ days as this temporary institutional debt tool has exploded recently.  Now, the US Fed has actively decreased rates and has begun acquiring more debt on its balance sheet.. hmm.  That seems strangely similar to another credit/debt crisis event.

(source: https://thesoundingline.com/october-saw-the-largest-increase-in-feds-balance-sheet-since-the-financial-crisis/)

We know many of our followers may consider this just another warning from a bunch of doom-sayers again.  We’re not wishing for this outcome – trust us.  We simply look at the technical data, determine a probable outcome and present our findings to our followers to try to keep them informed.

Too many similarities are starting to align to make this just some strange coincidence.  Too many unknowns and uncertainties are aligning just 12 months before a US presidential election cycle.  It seems strangely familiar to us that these same types of price events are unfolding now.  If there is no correlation then we’ll likely be incorrect in our analysis.  But if we are right and there is a major price reversion event setting up, we think it is wise to alert as many of our friends as possible.

Keep reading our research because our proprietary tools have been nailing all of these price targets and move many months in advance.

I urge you visit my ETF Wealth Building Newsletter and if you like what I offer, join me with the 1-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 Bar!

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.

Chris Vermeulen
www.TheTechnicalTraders.com

Welcome To The Zombie-Land Of Investing – Part 1

This current market environment is very reminiscent of the 2006-08 market environment where price rotated into weakness on technicals and continued to establish new all-time price highs in the process – creating what we are calling a “zombie-land melt-up”.  This very dangerous price action is indicative of money chasing a falling trend.  Where technicals and fundamentals are suggesting that price is actually weakening quite substantial, yet the process of price exploration is continually biased towards the upside as investors continue to pile onto the back of the beast expecting a further melt-up.

Let’s take a look at what happened to the ES and Gold in 2006 and 2007. But, wait before you continue reading make sure to opt-in to our free market trend signals newsletter.

SP500 WEEKLY INDEX CHART IN 2006-2007

First, we’ll start with the ES (S&P 500 E-mini futures contract).  Pay attention to the MAGENTA arcs we’ve drawn on this chart that highlight the continued new highs reached throughout 2006 and 2007.  Pay attention to the price rotation and volatility that started to happen near the absolute peak in July and October 2007 – just before the massive price collapse began.  Notice how the technical indicators had been suggesting that price was weakening quite extensively since the beginning of 2007 and more aggressively after July 2007.  Pay very close attention to the last peak on this chart and how a very deep price correction setup a new price high in a very tight FLAG formation just before the breakdown event.

PRICE OF GOLD WEEKLY CHART IN 2006-2007

This Gold chart from the same time period highlights how Gold anticipated the market weakness by rallying up to a level near $750 in May 2016 – then retraced nearly $200 before forming a lengthy price bottom/base.  Gold, acting as a safe-haven for investors, rallied almost 94% in the 24 months prior to this peak in 2006.  It rallied another 256% (at the ultimate peak) from the low point established in June 2006.  The process of this rally was an extended base/bottom in Gold between the base/bottom in 2006 and the renewed uptrend that started just before the end of 2007 (just before the markets started crashing).

COMPARE SP500 INDEX 2006-07 TO 2018-19

We believe the current uptrend in the US stock market is acting in a very similar price formation to what we’ve highlighted in the 2006-07 market “zombie-land melt-up”.  We believe that investors are piling into the US stock market when price weakness is clearly being illustrated by the technical and fundamental data.  We believe a capital shift has continued to pile money into the US stock market as foreign investors pile onto the backs of other investors seeking safety and security within a stronger US economy.

CONCLUDING THOUGHTS:

We believe the current Zombie-land market is anticipating a price roll-over event (reversion) and that technical and fundamental data supports this analysis.  We believe the credit/debt expansion of the past 8+ years has fueled a massive bubble that may result in a deep price correction if given the right circumstances and events.  We believe this upside price move in the US markets, which are setting up near the exact same time-frame as the 2008 price collapse, maybe a very stern warning for traders and investors – BE PREPARED.

In Part II of this research post, we’ll highlight the similarities setting up in the current market “Zombie-land” and what happened in 2006~2008.  The expansion of the credit market over the past 8+ years has been extensive throughout the globe.  The biggest difference this time is that risk may come from foreign markets vs. from within the US.

Keep reading our research because our proprietary tools have been nailing all of these price targets and move many months in advance.

I urge you visit my ETF Wealth Building Newsletter and if you like what I offer, join me with the 1-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 Bar!

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.

Chris Vermeulen
www.TheTechnicalTraders.com