This section of our multi-part article regarding current and past central bank actions, we are going to attempt to look at key elements of the past and present to highlight what we believe may turn out to be an incredible “setup” in the global markets.
This setup is almost like a complex chess game where two skilled players battle for control and near the end of the game, one player is left with the King, a Rook, and a Pawn while the other player has a dramatic advantage with stronger chess pieces. Yet, as the game continues, the weaker player is able to remove one or two of the stronger players key pieces and move his pawn to his opponent’s side to recover his Queen – thus altering the dynamic of the game and eventually winning.
This actually happened to me once playing against a friend of mine. My friend was so wrapped up in trying to move my King into checkmate, he left his other pieces open for me to target and remove – while leaving my Pawn untouched. After I had gained a clear advantage by removing his stronger pieces, I cornered his king within an area that allowed me to move my Pawn to his side of the board whereas I regained my Queen. At that point, the game was nearly over for him – and he knew it.
Did the US Fed and global central banks set up a similar type of process in the global economy? We can rephrase this question as did the global central banks inadvertently set up a massive credit/debt problem by attempting to pour capital into the global markets to spark an economic recovery? And did the acquisition of all of this debt/credit setup a “chase after the King” moment where foreign nations failed to understand the underlying risks associated with this move? Have the dynamics of the global markets shifted away from the advantages that were present three to four+ years ago?
So, let’s investigate the data to see what we can find out about what is changing in the markets.
One change that is critical to the understanding of consumer sentiment is the savings rates for consumers. Since the 2008-09 credit market crisis, Americans have started saving more of their income even though rates for savings have dramatically fallen. This is a shift in consumer sentiment that suggests consumers are attempting to put more cash into savings in preparation for some future event.
The Fed expects economic growth rates in the US to run at far lower levels than in 2011 and 2012. With all the capital that has been poured into the global markets, one would think growth rates would be moderately higher or climbing. But we believe the global economy is stuck in a mode where capital is unable to be effectively deployed throughout the globe because of inherent economic failures and processes that prevent future growth. We’ve discussed this in the previous article about how the US and global economies are stuck in a mostly 19th-century mode of operation while attempting to transition into a 21st-century mode of operation. This transition may take another 10 to 20+ year, but it will eventually happen.
Until that transition is completed, expect further bumps in the road as traditional expectations for investment and returns are shattered – forcing a move towards a 21st-century economic revival.
The price of commodities is a perfect example of how the 19th-century economy is purging itself while the new 21st-century economy is searching for a foundation/footing to take root. Oil is a prime example of the 19th-century economic foundation for growth and economic output. Yet in today’s world of solar, green and various other energy sources, Oil has fallen to near $52 ppb recently and could fall as low as $35 to $38 ppb in the future months. Considering Oil was recently above $120 bbp – what the heck happened?
This chart of the Index of All Commodities prices highlights the shift in capital and the shift in the economic mode of operation that is currently taking place. What was an increasing commodities price market in 2005~07 and 2010~12 has now been replaced with a decreasing commodity pricing market. Is this indicative of a collapse in the global economy? In some ways, yes. But we believe this is more indicative of a transitional economic shift away from 19th-century processes and functions and towards a more dynamic 21st century economic model for the globe.
This process, though, will be full of very large price swings, failures, successes, and opportunities for those skilled technical traders that are able to catch the moves and setup as they happen.
Lastly, the US Consumer Price Index chart. Notice how the GREEN highlighted area (from the early 1960s till 2000 were filled with positive CPI results? Notice how that changed in 2000 and how after 2000 the CPI levels fluctuated from positive to negative quite regularly? Now, pay attention to how the expansion of peaks immediately after the 2000 Dot Com bubble burst has been replaced with a contraction of peaks after the 2008-09 credit market crisis. What is causing the CPI to contract in this manner? Why is is that expansion of commodity pricing is unable to expand as it had been going for decades before 2008-09?
The key to understanding all of this is that the expansion prior to 2000 was an expansion fueled by rising wages, income, wealth creation and opportunity from a mature 19th-century economic model. The 1990 to 2000 narrow range in the CPI was related to the “early shift” away from the 19th-century economic mode and into the Dot Com (internet) mode of economic activity (where this new economic model was taking away from brick-and-mortar shopping malls and replacing it with virtual commerce activities. The recovery in 2005 was fueled by moderate quantitative easing in the US as well as a resurgence in more traditional economic functions related to the growth of economic opportunity in foreign nations, Europe and the push to expand digital technology throughout most of the developing world.
Then came the crisis of 2008-09, which was like blowing out 3 pistons of your V8 motor. You may still be able to limp the car around and back home, but you probably have to keep pouring high-octane fuel into it to keep it running and hope it does not blow out another piston or two.
This Custom Smart Cash Index chart is a perfect example of how capital works in the markets. It attempts to avoid risk by reducing exposure to risk events and attempts to pile into an opportunity as security and returns are setup for optimum outcomes.
Notice how in 2008 capital fled the global markets and how it slowly reentered the markets from 2011 to 2015. Pay attention to the dips in this Smart Cash Index and you’ll notice how these dips align with the US Fed and global central bank QE functions. Pay very close attention to the dip in 2015~2016. Why would cash want to avoid risks setting up during this time and what caused the global markets to fear excessive risks then? US Presidential elections – that’s what happened. And what is happening in November 2020? Yup – you guessed it.
Why would risks become so heightened at these times and throughout collapse events and where does capital rush into when these types of events happen?
CONCLUDING THOUGHTS:
In Part IV of this article, we’ll try to answer some of your bigger questions and we’ll explain why we believe an incredible opportunity is setting up for skilled technical traders over the next 24+ months.
Using technical analysis and proven strategies we can follow the market trends and profit from them no matter which the market moves. We bet with the market (the house) and provide entry, target, and stops for all trades we initiate.
NEXT MOVES FOR GOLD, SILVER, MINERS, AND S&P 500
In early June I posted a detailed video explaining in showing the bottoming formation and gold and where to spot the breakout level, I also talked about crude oil reaching it upside target after a double bottom, and I called short term top in the SP 500 index. This was one of my premarket videos for members it gives you a good taste of what you can expect each and every morning before the Opening Bell. Watch Video Here.
I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused on gold miners and the SP 500 index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.
On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.
More recently on July 16th, I warned that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.
https://thegoldandoilguy.com/wp-content/uploads/2019/08/42.png342850adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-14 12:20:572019-08-14 12:20:57Global Central Banks Move To Keep The Party Rolling – Part III
Our researchers have created this research post to highlight a big price move based on super-cycle research and patterns that should begin on or near August 19, 2019. Back in April/May 2019, we started warning of a critical top formation we believed was aligned for July 2019. In May/June, we altered this date to align more closely with our super-cycle research and determined the August 19, 2019 date.
It is our belief that this date will initiate a breakdown price move that may align with external news related or economic related data. Our research continues to point to the potential for a large global breakdown in equity prices related to some type of near-crisis event. It could be related to something within the US or outside the US – but either way, we slice it, August 19 looks to be the date we need to focus on.
– Crazy Ivan Market Prediction for Stock Market and Volatility Article
–Crazy Ivan Precious Metals Prediction Article
FANG Custom Index Weekly Chart
This FANG custom index weekly chart highlights how our Fibonacci Price Amplitude Arcs work in alignment with price rotation and trends. The theory behind this analysis is that price trends operate at a frequency and amplitude that we can map out – much like Tesla’s theory of Mechanical Resonance.
In our studies, we have learned how to identify relative price amplitude and frequency factors, then align these to price peaks and valleys. The result is that we can see where hidden support and resistance channels form and where the price will potentially reach an “inflection point”.
Right now, this week and next on this FANG chart are likely to see increased volatility and the potential for a price breakdown as the current RED arc level sets up a massive resistance channel.
Custom Smart Cash Index Chart
Our custom Smart Cash Index chart is also highlighting an overall weakness in the US and global markets. Once this chart breaks the lower price channel level, there is a very strong possibility that this index will break down toward the $134 level (or lower) as the global markets attempt to identify price support. Overall lows could target the $111 level (seeing in 2016) if the breakdown is excessive.
Custom Volatility Index
This Custom Volatility Index is suggesting a deeper price low is setting up if the August 19 breakdown date acts as we suspect. If the global markets break lower, then this Custom Volatility Index will be pushed into an extreme low territory (below 5.5) were a very deep bottom/base will setup (as we have seen before). If it reaches levels below 4.0, then we should be very close to a very deep “V” type bottom.
The recovery from this base/bottom will likely be somewhat extended as the shift in the capital around the globe seeks out the best, safest locations and returns. We believe this bottom will complete near the end of 2019 or into early 2020 where the US markets will quickly gain acceptance as the location for global assets to avoid extended risks.
What Does All This Mean?
August 19 is only a few days away and we could see fireworks start in the global financial market place.
If our analysis is correct, we have only 4 to 7+ days before a major breakdown in price starts and we are yet unsure of the source or intensity of this event if there is one. Multiple analysis types are pointing to August as a key turn date and the market could fall by as much as 16-25% if there is a trigger event to spark the crisis.
What should you do? Well, being a pilot, quasi engineer, and technical trader using logic, rules, and processes to do things. I always wait for the price to confirm a new trend before taking action and entering a position. This is how we profited last week from the SP500 index falling. We traded the 2x bear fund SDS and locked in a quick profit.
The days are long gone where I would buy or sell stocks or trends based on tips and forecasts. That type of trading is really called legal gambling and the odds generally are not in your favor unless you tips are coming from insiders who actually know something.
Using technical analysis and proven strategies we can follow the market trends and profit from them no matter which the market moves. We bet with the market (the house) and provide entry, target, and stops for all trades we initiate.
https://thegoldandoilguy.com/wp-content/uploads/2019/08/32.png561850adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-13 10:49:382019-08-13 10:49:38August 19 (Crazy Ivan) Event Only A Few Days Away
As we continue to explore the events of the past 10 to 20+ years and how the global central banks continue to attempt to navigate through these difficult times, we want to take a few minutes to try to understand and explain how the capital that has exploded into the global markets has been deployed and used to chase returns, risk and opportunity and may continue to be deployed more efficiently going forward.
Read Part I of this series here: https://www.thetechnicaltraders.com/global-central-banks-move-to-keep-the-party-rolling-onward/
The recent news that the global central banks may begin a new round of stimulus and easing got us thinking – “what next?”. Over the past 10 to 20+ years, global central banks have attempted to prompt an economic recovery that seems to slip past economic planners and we believe that is because core functions of the global economy are weaker than many expect. We’re going to try to explore some of these factors and prepare traders for what may come in the future months.
Much of the capital that was dumped into the markets was deployed into the global equity markets as investments in emerging markets, capital markets, and the US stock market. As much as everyone wants to think this capital went into infrastructure and other essential investments, much of it went into the only thing that was capable of generating an easy return with limited risk – the global stock market.
At first, after 2008, we saw an immediate jump in emerging markets. This sector of the global economy had been hard hit by the collapse in 2008-09 and an incredible opportunity existed because of a price anomaly that was created near the bottom in 2009. Emerging markets were recipients of some capital when the central banks began to infuse money into the system, but their equity markets were uniquely positioned for advancements because of the pricing levels after the crash.
The SPEM chart below highlights the recovery in the emerging market that took place almost immediately after the bottom formed in 2009. We can clearly see the immediate price advance and the resulting sideways price action after 2011. Once this sector recovered up to previous 2007 levels, there was really nothing else to push it much higher.
Traders should also take notice of the rally in 2016 and 2017. This rally was based on forward expectations that renewed interest in emerging markets would result in increased returns. These aligned with expectations resulting from the US Presidential election (2016) as well. This price advance consisted of a +86% price advance from $23 to $42. Could it happen again?
We believe the next phase of the global market recovery will result in a similar type of price advance after new lows are established in emerging markets. Skilled technical traders should continue to plan for and prepare for this type of setup once emerging markets complete a process of exploring lower lows to form a bottom. This process should complete just before the 2020 US presidential elections and will likely result in another price anomaly setup where the price is well below expected asset levels (extreme pessimism) and will set up as an incredible +40% to +80% upside potential as renewed optimism and the continued transitional process of the global economy persists. Traders just need to wait for the setup – then execute their trades.
The continued process of how capital rolls from one environment to another in search of returns is something we have attempted to explain in detail over the past months. We call it the “capital shift” process. Our belief is that capital (cash) is always hunting for suitable investments in various forms and continues to shift from one environment (market segment) to another as opportunities (ROI) and risks (healthy investment environments) change. So, think of capital as a migratory asset that continues to shift into and out of various segments of the market as opportunities and risks present themselves.
One of the biggest benefactors of the quantitative easing and central bank policies of the past 10+ years has been the US equity market. Take a look at this NAS100 chart to see what we mean.
When we take into consideration the post 9/11 market rally in this NAS100 chart (highlighted by the blue rectangle) we can see that, at that time, the capital was focused away from the US markets because other foreign markets were better positioned in terms of ROI and risk. Even though the US was engaging in moderate QE processes to recover from a moderate economic crisis, a price advance in the NAS100 was muted – nothing like the right side of this chart.
The post-2009 advance in the NAS100 is a completely different story. The technology sector in the US had shifted away from a heavy risk factor and into a “unicorn” mode by 2012/2013. This shift in the investment environment meant that global traders saw the US technology market (NAS100) and an excellent opportunity for capital deployment. As more and more cash poured into the NAS100 chasing these gains, prices continued to skyrocket higher. What next?
Unless the dynamics of this market shift away from expected gains or the US Dollar weakens dramatically, we believe the US stock market will continue to experience some volatility and continued price advancement while capital waits to see what happens throughout the rest of the global market.
We do believe the increased volatility of the past 2 years highlights an extended risk for rotation over the next 2+ years and we believe a move lower may be something we have to prepare for as the 6000 level has already been established as support. Therefore, we are not suggesting the NAS100 will go straight up from here. We are suggesting that unless something dramatic happens to change the economic environment, the US markets will continue to be viewed as opportunistic by global investors and that dips in price, even big ones, will likely respond with a nearly immediate recovery in price – even if a dip were to happen well below the 6000 level.
Once the economic environment shifts away from opportunity in the US, then all bets are off in terms of downside risk – if this ever happens.
Another factor that everyone must be aware of is Real Estate. Recently, US real estate has continued to rally as rates have continued to maintain some level of affordability throughout most of the US. Certain areas have gotten very un-affordable and these markets are already experiencing a pricing reversion where prices are declining as sellers attempt to attract buyers at high prices. Overall, though, the health of the US real estate market is still moderately strong.
One thing that we would be concerned about is a perceptional shift away from buying if the US Fed and global central banks engage in new stimulus processes. Consumers may view this process as a warning that some concern is underlying the efforts of the central banks and hold off on buying real estate while they wait to see what happens after the US 2020 elections. We believe this may already be happening right now.
CONCLUDING THOUGHTS:
The REZ real estate ETF continues to push higher as pricing becomes an issue and sales levels continue to support a fairly active market. We are concerned that a sharp change in perception could be taking place over the next 12+ months as fears of a change in US political leadership may thwart or diminish some forward expectations. Investors need to pay attention to all aspects of the markets in order to prepare for future opportunities and price moves.
In Part III of this article, we’ll look into some of the fundamental elements of the US and global economies and how the past actions of the US Fed and global central banks may have set up the global markets for the bigger price rotations we are expecting over the next 12 to 24+ months.
Also, takes a look at today’s charts compared to the 2008 market top and I can’t warn enough that the next financial crisis (bear market) is scary close, possibly just a couple weeks away. See Scary Bear Market Setup Charts.
FREE GOLD OR SILVER WITH SUBSCRIPTION
TO PREMIUM TRADE SIGNALS!
https://thegoldandoilguy.com/wp-content/uploads/2019/08/21.png544850adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-13 10:26:432019-08-13 10:26:43Part II – Global Central Banks Kick Can Down The Road Again
The recent news that the US Fed, China and many of the global central banks are continuing to make efforts to lower rates and spark further consumer spending and economic activity is reminiscent of the late 2010~2013 global economic recovery efforts. This was a time when the economy was much slower than current levels and when central banks were doing everything possible to attempt to raise consumer and business activity related to capital.
The world’s governments and banks operate on a very simple premise – transactions and economic activity must continue to operate within a fairly standard range of consistency in order for tax revenues and transactional fees to drive profits/income. If extended periods of economic contraction persist, the capacity to function within standard operating parameters diminishes very quickly for these institutions. A -5% to -10% contraction in asset values, transactional business, tax revenues and/or consumer activity over an extended period of time could result in a catastrophic set of events taking place.
All the credit issues and interest rate changes recently allowed us to profit from collapse in the stock market and rally in metals for a quick 24.16% profit last week.
The 2008-09 global credit market collapse
In the 2008-09 global credit market collapse, we witnessed an event that accelerated well beyond this -10% contraction very quickly. We believe the reason the US Fed and Global Central Banks are engaging in stimulus that is designed to attempt to spark further lending, borrowing and increased consumer activities to prompt another round of expansion within the global economy. We believe these efforts to support global asset prices and transactional processes and fees may end up supporting a process where many central banks and governments may end up paying consumers to borrow (negative interest rates) and pay consumers to continue engaging in economic activities.
Historically, central bank rates have never been this low in recent history and recent news that global central banks may continue to lower interest rates, ease monetary policy and introduce new stimulus programs suggests that concerns of a global market recession are real and that concerns the global consumer may contract economic activity and spending are real. Yet, is the answer to this problem related to real lending rates or something else?
Countries where risks are excessively higher rates
It appears from our research that the only countries that are capable of operating at rates that are closer to normal are countries where risks are excessive and rates are higher because they need to attract investment into their debt/bonds. Established markets appear to be operating in a mode where lending rates are not conducive to traditional economic mechanisms of spending, saving, investing and rational accounting fundamental. The closest example we can use to attempt to explain this process is to state that we believe the credit markets never fully recovered after the 2008-09 credit market collapse and the new debt created from that event has, as of yet, failed to prompt any real economic expansion.
We believe the global economy is within a transitional process that will result in a longer-term economic expansion – yet we believe the process of achieving this expansion may require the destruction of certain aspects of the current economic system. The chart below highlights the efforts from 2003 through early 2019 of global banks to stimulate and stabilize the global economy with every tool available.
As difficult as it is to see in this image, global central banks have engaged in various efforts, at various times, to enact a concerted effort to stimulated the global economy, then back away from stimulus to evaluate the individual processes of the global economy and its ability to support itself. Each rise in QE activity is marked with new challenges and new efforts to spark economic activity. We believe one of the main challenges of this policy is that QE efforts may have benefited the wrong segment of the global population at the time and further eroded the intended outcome of these efforts.
Throughout this incredible global effort to stimulate and stabilize the global economy, certain facets of the global economy have reacted positively while others have reacted negatively. Obviously, the benefits and failures of this continuing effort to transition through the recent economic malaise have resulted in a number of various advancements and declines over the years. It is rather interesting how capital has shifted into and out of various markets, segments, commodities and other forms in an effort to chase opportunity and returns while it appears the fundamental components of the global economy are still somewhat weak.
Next, in Part II of this article, we’ll take a look at some of the winners and losers over the past 10 to 20+ years as a series of global economic events continue to roil the global markets and we’ll discuss what we believe may become the final transitional phase of this global event.
MORE WARNING SIGNS AND TRADES TO BE AWARE OF: GOLD, SILVER, MINERS, AND S&P 500
In early June I posted a detailed video explaining in showing the bottoming formation and gold and where to spot the breakout level, I also talked about crude oil reaching it upside target after a double bottom, and I called short term top in the SP 500 index. This was one of my premarket videos for members it gives you a good taste of what you can expect each and every morning before the Opening Bell. Watch Video Here.
I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused mainly on the SP 500 index and the gold miners index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.
On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.
More recently on July 16th, I warned that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.
https://thegoldandoilguy.com/wp-content/uploads/2019/08/11.jpg488678adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-12 23:22:072019-08-12 23:22:07Global Central Banks Move To Keep The Party Rolling Onward
Copper is a fairly strong measure of the strength and capacity of the global economy and global manufacturing. Right now, Copper has been under quite a bit of pricing pressure and has fallen from levels above $4.50 (near 2011) to levels near $2.55. Most recently, Copper has rotated higher to levels near $3.25 after President Trump was elected on November 2016, yet has recently fallen as trade and global economic concerns become more intense.
This should be viewed as a strong warning sign that institutional traders and investors are very concerned that the future economic and manufacturing activities throughout the world are continuing to contract. Copper is used in various forms throughout all types of manufacturing and consumer products, such as computers, building & infrastructure, electronics, chemical & medical use as well as automobile and aircraft manufacturing. It makes sense that copper prices would be a leading indicator for much of the global economy and relate to economic output and capacity.
Copper Monthly Long Term Chart
As the US/China trade war continues and we enter the final stretch of the US Presidential election cycle, we believe that copper will breakdown below the $2.50 level and attempt to identify past support levels below slightly $1.50 over the next 6 to 12+ months. We believe the next big move in commodities will be a contraction move where certain commodities (mostly manufacturing & industrial related) will collapse as the world focuses on two of the most important events that are about to conclude in 16+ months: the US Presidential elections and the Global Trade/Economic issues.
Copper Monthly Pennant Pattern
The breakdown in commodity prices as related to slower expectations and global economic demand may see a dramatic downside move or may see a more measured “slide” towards the $1.45 level (much like what we saw happen between 2013 and 2016). Overall, though, we believe the downside price move outweighs the upside at this time – unless some type of dramatic resolution to the US/China trade issues and global economic slowdown are ended.
We’ve also highlighted an extended long-term Pennant/Flag formation in Copper that should provide further insight as to the range of price rotation before the bigger breakdown in price occurs. This pennant formation will likely contain the immediate price range/rotation over the next few months to between $2.30 to $3.00. Should price break below the $2.25 level within the next 2~6+ months, then we would expect an immediate downside move towards the $1.50 level.
CONCLUDING THOUGHTS:
Following the core commodities as related to global economic and manufacturing demand and capacity are key elements to understanding how traders and investors are viewing the future expectations for the global markets. Commodities like Copper, Gold, Silver, Oil, Natural Gas and others can often be leading indicators related to global economic output and expectations. We urge all traders to prepare for a broader market contraction event over the next 6 to 12+ months based on our research that suggests Copper is setting up for a breakdown move.
These global market price swings in 2019 and 2020 are going to be huge events that will present incredible opportunities for skilled technical traders. You don’t want to miss out on the opportunity these types of big moves present. In fact, last week we closed out 24.16% in profits for the first week of August and you can see the charts here.
Following the core commodities as related to global economic and manufacturing demand and capacity are key elements to understanding how traders and investors are viewing the future expectations for the global markets. Commodities like Copper, Gold, Silver, Oil, Natural Gas, and others can often be leading indicators related to global economic output and expectations. We urge all traders to prepare for a broader market contraction event over the next 6 to 12+ months based on our research that suggests Copper is setting up for a breakdown move.
These global market price swings in 2019 and 2020 are going to be huge events that will present incredible opportunities for skilled technical traders. You don’t want to miss out on the opportunity these types of big moves present.
Recently warning that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.
I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused mainly on the SP 500 index and the gold miners index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.
On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.
Kill two birds with one stone and subscribe for two years to get yourFREE PRECIOUS METAL and get enough trades to profit through the next metalsbull market and financial crisis!
Chris Vermeulen – www.TheTechnicalTraders.com
https://thegoldandoilguy.com/wp-content/uploads/2019/08/1.png328850adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-12 23:01:542019-08-12 23:01:54All Eyes On Copper
In the first part of this multi-part research post, we highlighted what we are calling a Crazy Ivan price event (borrowed from the movie Red October – (source). The one thing we want you to take away from this article is that August 19, 2019, should be a major price inflection date where the price is very likely to begin a new downside price trend in the US and global stock markets. This will likely push commodity prices to extremes and may very well push Gold and Silver into the stratosphere as fear and greed take hold across the planet.
Part I we highlighted how the VIX and the NQ are set up to react to this Crazy Ivan pricing event and how we believe many traders/investors are simply unaware of the potential for this type of large reversion price move. We want to be clear, we believe the US markets will be somewhat immune from extended downside risks. This does not mean there won’t be a downside price move and this does not mean that the markets won’t experience the Crazy Ivan reversion trend. It will likely happen just as we are expecting, yet we believe the US stock markets will quickly recover from this move – like it has done many times in the past.
Our research that highlighted this August 19, 2019 date and the potential for what we are calling the Crazy Ivan price move is rooted in our super-cycle analysis, predictive modeling tools, and other specialized proprietary price modeling solutions and utilities. We believe we’ve identified a key inflection point/date that will start what we are calling a “breakdown move” which will lead to the Crazy Ivan event throughout the globe. As we stated in the first part of this article – we don’t know the exact composition of this event yet, but we do know that is should begin to happen near or after August 19, 2019.
Now, let’s get busy digging into the Gold and Silver charts for all our followers.
Gold 2-Week Chart Interval
This first Gold 2-Week chart highlights our Fibonacci price modeling tool and helps to show us where the price is targeting for the initial upside move from the April 21~24 Momentum Base pattern that we called back in January 2019. We believe the current breakout upside price move will initially target the $1597 level before briefly stalling, then rallying further to target the $1785 level or higher.
We believe the Crazy Ivan event could push Gold much higher than our projected levels under certain circumstances:A. The US Dollar weakens throughout the initial process of the Crazy Ivan event
B. Cryptos collapse as governments clamp down on rogue exchanges/currencies
C. Massive credit and debt issues arise in China, Asia or the EU that threaten future economic output and operations
D. Some type of crisis event unfolds where global investors believe war or conflict is imminent. (think Hong Kong, North Korea or somewhere in that general vicinity).
Without these additional impetuses in the metals market, we believe the price will follow our Crazy Ivan expectations (YELLOW LINES, below) fairly closely over the next 30 to 60+ days.
Silver Daily Chart Interval
Silver, on the other hand, is set up to break substantially higher based on the upside move we expect in Gold and the possibility that the Gold/Silver ratio will continue to contract to lower levels. Recently, the Gold/Silver ratio fell from approximately 93 to 86. This move relates the total number of ounces of Silver one must buy to equal the price of one ounce of Gold. Currently, this level is back up to 89.5 as Gold has rallied faster than Silver has rallied.
But what happens when traders catch onto the fact that Gold and Silver will rally as this Crazy Ivan event takes place and that Silver is the true undervalued metal across the planet? At the peak of Gold/Silver prices near April 2011, the Gold/Silver ratio was resting near 32 (yes you read that properly). What would that look like on the Silver chart, below, if Gold continued to rally to levels above $2000? It is really simple to find out.
$2000 (Gold per ounce) / 32 = $62.50 per ounce for Silver
What if Gold rallied a full 100% Fibonacci measured move from the previous 1999-2011 rally? That peak level would be $2700 in Gold and the calculation is still simple.
$2700 (estimate Gold peak) / 32 = $84.375 per ounce for Silver.
Could it happen like this? Yes, in theory, and reality it really could happen that Gold rallies to a level that equals a full 100% Fibonacci price extension and the ratio level falls to levels near 32. If that were to happen, then these calculations would be accurate.
This is why we believe the Crazy Ivan event will become the catalyst for some really incredible trading opportunities and big price swings over the next 6 to 13+ months.
CONCLUDING THOUGHTS:
Our $21 upside price target in Silver is really muted compared to our long term price projections. Yet everything hinges on this August 19, 2019 breakdown cycle date and what happens after that. Our research suggests this current downside price move may have been a volatility explosion related to the lack of liquidity in the global markets and to hint that the markets are capable of being far more irrational for far longer than anyone expects.
We are only 9 days into August and we have already closed out 24.16% in gains from the falling SP500 using SDS, and the pop in gold using UGLD, and from the oversold bounce and rally in silver miners SIL.
We urge all of our followers to pay attention to our research, consider your options very closely and prepare for this next move by pulling some of your active portfolio away from risks and into more protective measures. This Crazy Ivan event is just 10 days away and we really want to urge all of our followers to not under-estimate this event cycle.
WARNING SIGNS ABOUT GOLD, SILVER, MINERS, AND S&P 500
In early June I posted a detailed video explaining in showing the bottoming formation and gold and where to spot the breakout level, I also talked about crude oil reaching it upside target after a double bottom, and I called short term top in the SP 500 index. This was one of my premarket videos for members it gives you a good taste of what you can expect each and every morning before the Opening Bell. Watch Video Here.
I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused mainly on the SP 500 index and the gold miners index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.
On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.
More recently on July 16th, I warned that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.
https://thegoldandoilguy.com/wp-content/uploads/2019/08/121.png470850adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-10 01:04:352019-08-10 01:04:35Part II – Metals and VIX Are About To Pull A “Crazy Ivan”
I hope this weeks sell-off and rally whipsaw didn’t catch you off guard? Subscribers of TheTechnicalTraders Wealth Building Newsletter pocketed a whopping 24.16% return this week with three positions (SDS, UGLD & SIL).
Anyways, on Wednesday I sent you a reminder that I will be adding my short term trading signal software signals to my newsletter like the ones listed above and once I add these I will be raising the newsletter price.
My ETF Trading Newsletter is available with up to a 30% discount plus I am giving away a free silver or gold bars for select membership levels which could be worth a lot of money a year or two from now and pay for most of the newsletter. I just wanted to let you know this lower rate and offer will end soon so this will be your LAST CHANCE to get on board and test drive an ETF trading service that truly makes money for its subscribers and teaches you at the same time!
Summer is coming to an end which means it’s time to prepare for a strong fourth quarter in trading. The Wealth Building ETF trading and education program has been navigating its members through the market with precision for many years.
In fact, we just broke the 100% return
on our entire portfolio since Jan 2018.
The focus is on US-based exchange traded funds but if you live in Canada or overseas you can use our trades one similar ETFs for your own exchanges and make similar returns!
In case you don’t know who I am, my name is Chris Vermeulen the founder and editor of the Wealth Building Newsletter to make navigating the financial market as easy as it gets. I provide simple low-risk ETF trading analysis sharing all of my trades ideas with the subscribers. You start the day knowing exactly what type of volatility to expect in the coming session and where the key support and resistance levels are for the key underlying asset type being the Dollar, Oil, Gold, Silver, Bonds and S&P 500.
If you have a smaller trading account this is the perfect service for you because of the scalability which ETF’s provide. Be sure to check out my website www.TheTechnicalTraders.com because he has a killer offer to become an exclusive member before this Friday.
As we head towards the fourth quarter I have a few great trade ideas queued up. Overall it looks like 2019 will continue to be another banner year for the newsletter!
https://thegoldandoilguy.com/wp-content/uploads/2019/08/115.png435640adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-10 00:39:252019-08-10 00:39:25Up over 24.16% in Gains this month and its only Aug 8th Sent Thursday, August 8, 2019
We’re borrowing a term from the movie Red October (source) that describes an unusual change of direction for a Russian submarine with the intent to seek out enemies and unknown targets – called a “Crazy Ivan”. We are using this term because we believe the markets are about to pull a very unusual “Crazy Ivan” move of their own – reverting to unknown price levels while the US/Global markets attempt to seek out risk, support, resistance and other unknown “revaluation” targets in the process.
Our belief is that a key cycle date, August 19, 2019, will be the start of a breakdown in the US markets that aligns with some outside type of catalyst event. It could be that foreign central banks issue some news or warning at that time or it could be that Asia/China issue some type of catalyst to the event. We don’t know what the catalyst will be but we can guess that it will be related to geopolitics or the global economy/credit/debt issues. God forbid it to be some type of war or human crisis event – we really don’t need that right now.
Please review these earlier research posts for more information :
July 24, 2019: PART II – BLACK HOLE IN GLOBAL BANKING IS BEING EXPOSED
July 24, 2019: SILVER PRICE TARGET DURING THE NEXT BULL MARKET
July 20, 2019: US & GLOBAL MARKETS SETTING UP FOR A VOLATILITY EXPLOSION – ARE YOU READY?
July 13, 2019: MID-AUGUST IS A CRITICAL TURNING POINT FOR US STOCKS
Our job as research analysts is to highlight what we believe is likely to happen and why we believe it is likely to happen. Therefore, without guessing as to the cause of the event, let’s focus on the “Crazy Ivan” event and how we can attempt to profit from it.
First, let’s take a look at the VIX chart. The VIX basing level (the lowest level the VIX has attained between price spikes) has been increasing as US stock market volatility continues to increase. The nature of the calculations that make up the VIX would suggest this increase in basing levels would happen as extended volatility continues to be present in the markets – so this is expected. What is not expected is the August 19th price inflection point that we believe will drive an unexpected price reversion in the US and global stock markets. We believe this cycle inflection date is key to understanding how the markets will react going into the end of 2019 and beyond.
If our analysis is correct, then we believe a breakdown in the US and global markets will occur on or shortly after August 19, 2019, where the US stock markets are poised for a -15% to -25% price reversion. This downside move in the US stock market would set up an incredible “price anomaly” for skilled technical traders that should provide an incredible opportunity for future profits.
We believe the ultimate downside potential for this move may last all the way through the end of 2019 and into early 2020 – although we can’t be certain yet as to the depth and severity of this move using our predictive modeling tools and utilities. All we know is that it is about to happen based on what our predictive modeling tools are telling us and we have continued to try to warn you of this move for the past few months. So here it is – the Crazy Ivan (as we’re calling it).
Any VIX rally that pushes the price above 30 or 40 would have to be rather severe compared to previous rotations. The spikes on this chart related as follows on the NQ chart :
Early May VIX Spike to 23.31 resulted in a -938.25 point move (-11.91%) in the NQ
The current August VIX spike to 24.80 resulted in a -848.75 point move (-10.54%) in the NQ.
What would a move to above 32 in the VIX look like on the NQ chart? How about a move to above 42 on the VIX? Hello Crazy Ivan.
This next chart of the NQ on a monthly basis highlights our Adaptive Dynamic Learning (ADL) predictive modeling system at work. This utility helps us to understand where the price will want to target in the future and also helps us to understand trend and outlying price trends (or price anomalies). Price anomalies happen when price moves substantially away from where the ADL predictive modeling system is suggesting price wants to be at. Thus, if the price of the NQ were to fall below $5500 very quickly (think Crazy Ivan) and our ADL modeling tool suggests that price really wants to be at $6800 at that time, then we have a $3300 price anomaly setting up. This is a type of reactive price anomaly that suggests price is way off target and will attempt to revert to levels closer to the ADL predictive price levels.
We believe the Crazy Ivan event could push the price of the NQ much lower than our ADL predictive modeling system is suggesting and create a price anomaly that may become one of the most profitable trades near the end of 2019.
You can see from this ADL predictive modeling chart that price is expected to be lower near the end of 2019, but steadily climb higher into early 2020. If price were to end up below 6400 by the end of 2019, that would set up a 1000+ point price anomaly setup that could become an incredible upside price move in early 2020. Time will tell as this Crazy Ivan event plays out.
CONCLUDING THOUGHTS:
In the second part of this article, we’ll study the Crazy Ivan event in the metals and show you what we believe will happen to both Gold and Silver as this event plays out. You won’t want to miss this one.
WARNING SIGNS ABOUT GOLD, SILVER, MINERS, AND S&P 500
In early June I posted a detailed video explaining in showing the bottoming formation and gold and where to spot the breakout level, I also talked about crude oil reaching it upside target after a double bottom, and I called short term top in the SP 500 index. This was one of my premarket videos for members it gives you a good taste of what you can expect each and every morning before the Opening Bell. Watch Video Here.
I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused mainly on the SP 500 index and the gold miners index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.
On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.
More recently on July 16th, I warned that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.
https://thegoldandoilguy.com/wp-content/uploads/2019/08/110.png470850adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-10 00:10:492019-08-10 00:10:49Metals and VIX Are About To Pull A “Crazy Ivan” – Part I
Larry Jacobs the owner of TradersWorld magazine which is the best publication for technical analysis and technical trading featured a great article on the where the stock market is as of today, and how this exact setup in price is what we experienced in 2008 JUST before the big crash.
Download the magazine here free and skip to page 7 which is the first article and give it a quick read, it’s packed with incredible insight for what is next, not only for the US stock market but gold, silver and miners also.
https://thegoldandoilguy.com/wp-content/uploads/2019/08/105.png447345adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-09 23:52:142019-08-09 23:52:14Lead Story in TradersWorld Magazine – Free and A Must Read pg 7
Chris Vermeulen, Founder of The Technical Traders joins Cory Fleck today to share his thoughts on the recent downtrend in US markets and oil, plus a couple of comments on the gold uptrend. Long term trends are still the most important and until a larger break happens the trend is still higher. more importantly, the gold uptrend seems to just be beginning.
https://thegoldandoilguy.com/wp-content/uploads/2019/08/audio-image.jpg10001000adminhttp://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.pngadmin2019-08-09 10:10:212019-08-09 10:10:21A LOOK AT THE DOWNTREND IN US MARKETS AND OIL, AND THE UPTREND IN GOLD
