Archive for year: 2018

Our proprietary adaptive learning tools, specifically our adaptive predictive price modeling tool, is clearly illustrating higher price rotation over the next few weeks with a strong potential that the US equities markets will break to be all-time highs near Dec 2018 or early 2019.

Our research team has spent more than a decade studying the markets and developing specialized tools to assist us in understanding current and future price activities.  This one tool, the Adaptive Dynamic Learning (ADL) Price Modeling system is one of the more dynamic tools we have ever created.  We can ask it what it believes is the highest probability future outcome many weeks, months or years in advance.  Today, we are sharing with you what we believe will be a strong upside price rotation to close out 2018 and lead into 2019.

This QQQ Weekly chart shows two data points of our ADL price modeling system.  The reason we asked for these two points of analysis is that we attempt to identify aligning price analysis when using this tool.  In other words, when the analysis aligns well in multiple instances, we believe the outcome to be more sustainable going forward.  In this instance, data points originating from August 13 and September 17 clearly highlighted the downside rotation in early October and suggest we could see another 2 to 4 weeks of price rotation near the “Support Zone”.  These ADL predictive levels also align well with our suggestion that a November 8 ~ 12 ultimate price bottom will set up.  After that, we still believe the markets will enter a rally mode that could present a 10% to 12% upside move well above recent highs – breaking through the Resistance Zone quickly.

The one concern we have regarding this future price prediction is that out modeling systems are showing the Precious Metals are also setting up for a bigger move and that allows us to understand some of the dynamics that are at play in the markets.  If the metals begin to move higher while the US Equities markets also move higher, it would indicate a moderately strong “capital shift towards safety and away from risk” is taking place.  Thus, the US equities markets and Precious Metals would BOTH be moving higher at the same time.  We believe this could be an event that puts additional pressures on the Emerging Markets, Oil, Foreign Currencies and other commodities while the US Dollar continues to maintain overall strength.

We’ll know more in early 2019.  Right now, we can tell you that our modeling systems are suggesting “the bottom is in” and that we should be expecting upside price rotation throughout the rest of 2018.

Please take a minute to learn more about what we do and how we can assist you in finding and executing better trades.  Visit www.TheTechnicalTraders.com to learn more about our team, our tools, and our services.  Isn’t it time you invested in your future success?

Chris Vermeulen

Our research team was hard at work over the past few days.  Not only were they able to call this downside price swing 3+ weeks in advance, they also called the market bottom within 0.5% of the absolute lows.  Now, they have put together a suggested “map” of what to expect in regards to price rotation, support, resistance and the eventual price breakout that we are expecting to happen near or after November 8~12.  Today, we are sharing this detailed map with all of our followers.

Our research team, at www.TheTechnicalTraders.com, have honed their skills over the past few decades by studying market correlations, price relationships, advanced price modeling and more.  Our objective is to be able to identify price patterns, opportunities, and setups while attempting to accurately predict the future of price so that we can keep our followers and members uniquely aware of future opportunities.  As you can imagine, it is not an easy job and we often take heat for some of our research posts.

Today, we are sticking out neck out (again) and attempting to predict the future of the ES price rotation as this deeper rotation continues to play out.  Our research team believes it has identified key price levels and dates/times that are relevant to this future price rotation.  By no means is this research set in stone in regards to exact dates/times.  These are suggestions which we believe to be accurate based on our research and analysis of the markets.  Use them as guides to how this price rotation plays out.

This first chart is a Daily ES chart that shows three very important components of the current market price rotation.

_ The Support Zone below the recent lows is actually very critical to the true understanding of price rotation.  As long as this support zone is not completely breached, prices should continue to push higher overall.

_ The Rotation Zone is where we believe the price will continue to consolidate within a fairly tight range before the November 8 ~ 12 bottom sets up.  Volatility will continue to be greater than normal throughout this Rotation Zone.

_  The post-November 8 ~12 breakout is likely to attempt to target 3131 initially (a Fibonacci extension target) and we believe this move higher could explode fairly quickly.

Now that we have explained the general sense of our research, let’s dig into the numbers a bit.

Our expectation is that a price peak will occur near early morning trading on October 26 (morning session in NY).  We believe this peak will end near 2830 (a Fibonacci 50% retracement level) and we believe an extended basing pattern will precede this price peak.  The extended basing pattern, which is expected to end near 2770 (a Fibonacci 25% retracement level) is already starting to form and should last from now until near October 23 or 24.  We believe the upside move between the end of the basing pattern and the October 26^th peak will be very fast and end fairly quickly – so be prepared.

The October 26 price peak will set up a very important component of our final analysis – the peak-to-peak price channel (highlighted in YELLOW now) and will allow us to determine when and where price volatility predicts the breakout move to occur.  Our research team believes another bout of extended basing will occur after the October 26^th peak that will likely push just below the 2771 support levels (to near 2750) retesting the Support Zone and presenting a “false low price breakout” pattern that may sucker many longs out of the market (and potentially set up massive short seller pressures in the market).  This move may be critical to the eventual upside breakout that we are predicting.

Think of it like this, Fibonacci price theory suggests that price MUST attempt to establish new higher high prices or lower low prices at all times.  Failure to accomplish these new price levels results in a consolidating/congesting price trend that typically forms as Pennants or Flags in price.  Near the Apex of these pennant/flag formations, false breakouts (or what we call “washout lows or highs”) are common.  These are price functions that operate as a “shakeout move” where price searches for direction and where buyers and sellers are stacked on top of one another attempting to ride the next wave.  Price MUST attempt to establish a new higher high or lower low – so it must attempt to rally up and break the 2945 level or it must selloff ant attempt to break the 2712 level.  We expect extreme volatility near or after the November 8~12 apex setup.  Price could fall deep into the Support Zone before reversing higher with a bigger rally that attempts to run well above the 2945 level.

The vertical blue line is the November 8 date where we expect the absolute bottom to form and where we expect the next big price rally to initiate.  Near after this date, we expect the price to rotate with greater volatility and attempt an upside breakout move near or after November 12.  The key Fibonacci levels at 2771 & 2829 are certain to become key price rotation levels near this November 8 ~ 12 price breakout.

At this point, we have outlined some very detailed and structured price rotation levels that should clearly help you understand what is transpiring within the US Equities markets right now.  If you take only one thing away from reading this article, please understand the Support Zone that we’ve highlighted on our charts is super-critical to the ability for the US Equities markets to continue to push higher.  If this level is completely breached by lower prices (prices falling all the way below these price channels on the Daily chart, above), then our predictions of price rotation, extended basing and an ultimate upside price breakout are invalid.  This Support Zone MUST hold for our analysis to become valid.

This level of research and understanding as related to technical and price analysis is not something one stumbles upon blindly.  This takes years of study, practice, research, and understanding to be able to “see into the future” as we do.  Sure, anyone that understands basic trend lines and Fibonacci concepts can draw some lines on a chart – but their overall success rate will quickly illustrate their true understanding of the markets.  Take a minute to visit Technical Traders Ltd. website and read some of our recent research posts and pay attention to how we accurately predicted a 5~8% price correction 3+ weeks before this recent move happened.  Ask yourself, how did we know it was going to happen and how did we know it would stop near 2700?  Visit www.TheTechnicalTraders.com/FreeResearch/ to read all of our recent research posts or read how we predicted this downside price move by clicking here: https://www.thetechnicaltraders.com/predictive-trading-model-suggests-falling-stock-prices-us-elections/

Chris Vermeulen

As fast as the downside breakout occurred, the upside recovery appears to be taking place as Q3 Earnings begin to hit the news wires.  This past weekend, the news cycles and market experts all seemed to have opinions about where the US equities market was headed after last week’s price collapse.  We’ve read everything from warnings of a $20 trillion dollar collapse to seeing Bloomberg’s SMART INDEX chart showing equity valuations are near historic market bottoms.  It seems everyone wanted to get out and share their opinions – I guess we are no different.

The facts still remain the same, until the global market dynamics change and the US equities markets break the defined price channels that have been well established, we do not see any reason to consider a 6~8% correction life-threatening.  In the total scope of the price range, this move represents less than a 25% price correction from price rotation points (as you’ll see on the longer term NQ chart below).  Yes, eventually, some critical market event might cause the US equity markets to change direction, but until then stay safe and roll in and out of trades with skill.

Our research team, at Technical Traders Ltd., has continued to stay on top of this move by predicting the downside move over 3 weeks before it happened and by calling the bottom near 2700 on the ES.  Recently, we posted two articles regarding the Q3 earnings expectations and the longer term price channels that are defining this current move.  We suggest you visit www.TheTechnicalTraders.com to read our most recent research posts.

The recent upside price swing in the US Equities markets should not have been a surprise if you had been following our analysis and research.  These types of price rotation are actually very healthy for the price and allows the price to establish support, wash out a few weaker positions and allows skilled traders to position themselves for future success.

This Monthly NQ chart shows you what our research team has identified as a price pattern going back 8+ years.  Since the 2009-10 bottom in the markets, price rotation has been limited to about 0.25% total retracements for each upward price range.  This is interesting in the sense that rotation is occurring in price, but it has historically been somewhat limited to within the 0.25% range.  This also suggests that as price continues to climb and expand, the 0.25% retracement range is also expanding.

Still, until we see a deeper price retracement that clearly breaches support channels and confirms a downside move, we don’t believe any real danger exists to the downside.  We have advised our members appropriately to watch for this move and protect their open long positions as this downside setup was identified by our team over 4 weeks ago.  Now, we are advising our members to take advantage of strategic opportunities in selected symbols because of what our predictive modeling systems are suggesting.

This 240 minute ES chart shows the recent upside breakout of the FLAG/Pennant formation near the support levels (2733~2744).  These levels were identified by our research team shortly after the bottom had formed and allowed us to understand that as long as price stayed above these levels, an upside price breakout was the strongest possibility.  The “washout” price rotation near the apex of the FLAG formation was expected as well.  Our team believes the upside price move is just starting and that price will move to near 2830 before stalling and potentially retracing back to near 2785.  Remember, our research shows that a true price bottom will not form in the US markets will somewhere near November 8~12.  Somewhere near these dates, the US Equities market should form a very solid price bottom and begin to really accelerate to the upside throughout the end of 2018.

We’ve already positioned our subscribers to effectively profit from the future moves we expect in the markets.  Our predictive modeling systems are showing us what is the highest probability outcomes and our job is to keep our subscribers well informed and ahead of these moves.  We urge you to spend a bit of time reviewing our most recent research posts to better understand the current market environment: visit www.TheTechnicalTraders.com/FreeMarketResearch/ to access all of our public research posts.  The Christmas rally should be setting up very quickly and this Q3 earnings season is likely to present some very good trading opportunities.  Get ready for 2019 by following our research and staying ahead of these market moves instead of following along after the moves have taken place.

Chris Vermeulen

There has been quite a bit of information and opinion in the news recently regarding the recent downside price action in the US Equities markets.  We’ve seen everything from “The sky is falling” to “The markets will rally into the end of the year”.  If you’ve been following our research and analysis, you already know what we believe will be the likely outcome and if not – keep reading.

There are a number of key components of the global economy that are of interest currently; US Treasuries, Precious Metals, Emerging Markets, the European Union, Trade Issues and Capital Shifts.

When one considers the scope of the entire global market environment in terms of these individual issues, a fairly clear picture of what is really happening begins to take shape.  Here is our summarized opinion of the current state of the global markets.

Capital is shifting (again) as the US Technology and high return sectors come under pressure.  What happens, typically, in this type of environment is that capital moves away from risk (into cash or other suitable investments) as these sectors continue to weaken.  Capital will return to these sectors once the risk factor diminishes or abates.  Once the S&P fell below the 2915 level, a number of Sell Programs generated extensive downside pressure on the markets – in a way, creating a “wash-out low” price rotation fairly early in this move.  Investors and capital will return into these sectors over time as they find support and wash out the extended volatility that is currently at play in the markets.

This capital shift is not unique to just the US markets though, there are other factors involved as well.  News that Asian investors have been pulling out of the US Real Estate markets at a record pace, as well as the US Fed actions raising rates recently, has put additional pressure on the valuation/pricing levels in the US equities market.  This is likely the reason why Gold and Silver rocketed higher last week.  This pricing pressure, even though it was known prior to this downside price move, was not much of a concern for investors because the US stock market indexes didn’t show worry or concern for this issue.  There was no real issue with downside pricing concerns.  Once the S&P broke that 2915 level and the sell programs kicked in, this became a real issue for many.

Yet, the longer-term perspective of this market has not changed much since early 2016.  Take a look at this chart that highlights the pricing channels established in the S&P of the past 20 years.  Each of these paired price channels originates at a low price point and reflect price range, slope and volatility as the progress further to the right.  Notice how the original (GREEN) and most recent low-price range (GOLD) reflect a broader price range where volatility was higher and the slope is slightly lower than the shorter-term price channels.  These reflect broader price support channels and help us to understand the core slope levels of price advance.

The shorter-term price channels (YELLOW, MAGENTA, BLUE & ORANGE) illustrate the “impulse channels” that are a result of localized or consensus advances.  In other words, these types of advances are the result of some impetus event like Quantitative Easing, policy changes, US Election results or any combination of social & economic improvement factors.  Price is always attempting to rotate as it attempts to establish new highs and lows.

We try to stress one key Fibonacci Price Theory component to all of our followers:

“Price MUST always attempt to seek out and establish new price highs or new price lows”

This one premise of Fibonacci Price Theory is so important to understand in the greater context of price movement.  On a Daily chart, the recent downward price swing may look frightening, but on this Monthly chart, it falls right in line with the ORANGE price channels (which happen to be the most recent and most aggressively upward sloping price channels over the past 20+ years).  Additionally, the price has advanced above the Upper GOLD price channel range and back into the BLUE price channel range in late 2017 and early 2018.  At this point, price appears to be accelerating quite well and these new support levels (BLUE, ORANGE, and GOLD) are critical to understanding the basics of Fibonacci Price Theory.

So, as you listen to the talking heads on TV and in the news cycles, please understand that true price theory teaches us that “until price breaks recent critical lower or higher price levels, the market price will always attempt to rotate in an effort to seek out and establish new price highs or new price lows”.

This rotation is very healthy for the markets, overall, and this price rotation may, eventually, prove to be a retest of price support before a further advance.  Our research team believes the low established near 2712 will likely continue to operate as critical price support as this price rotation continues to extend.  Our research team also believe a new price advance phase will become established shortly after November 8~12.  Our predictive modeling systems suggest a new price upswing will begin to take place after these November dates.

We urge all of our followers to visit our website, www.TheTechnicalTraders.com, to learn how our dedicated team of researchers and technical traders can assist you in finding and executing better trades, stay ahead of these markets move and properly prepare for the opportunities created by these swings in price.  Additionally, take a minute to review some of our past research posts, www.TheTechnicalTraders.com/FreeMarketResearch/, to see how we predicted this downside price rotation over 3 weeks before it happened.  It pays to have a dedicated team helping you understand and profit from these market price swings.

Our research team, at www.TheTechnicalTraders.com, is alerting our members that the Transportation Index has reached its first level of support near 10,500 and this level may be the start of an extended bottoming formation.  If you have been following our research posts, you already know that we predicted this recent downside price swing over 3 weeks ago with our Adaptive Learning Predictive Modeling systems.  You will also understand that our modeling systems suggest this move may not end till early November (somewhere between November 8~12).  Keeping this in mind, we are now alerting you to be prepared for the following.

This Weekly US Transportation Index chart highlights what we believe will become support for the US stock markets.  The 10,500 level, highlighted by the GREEN horizontal line, is a key support level that goes all the way back to late 2017 and early 2018.  This level will likely present strong support for the Transportation Index and, thus, for the US stock markets in general.  We do expect the continued downside pricing pressures to test this level over the next few weeks, but we are beginning to think we may be setting up for an extended bottom formation that may include many weeks of volatility and sideways price rotation.

If the 10,500 level is breached, secondary support exists at the 10,000 level (only 500 pts below).  As dramatic as that move will be, if it happens, this suggests that any attempt to move to near this level could be considered a “wash-out low” price rotation – a typical bottom formation.  At this point, we believe the 10,500 level is holding as we are not seeing extended downside price action in the current market.  If the US stock market was severely threatened by internal or external factors, we believe we would have seen much deeper follow-through the day after the massive price collapse.

What does an extended bottoming formation look like and what should we expect over the next few weeks?  Please take a look at this Daily Transportation Index chart that shows an earlier example of extended bottoming and bottom price rotation before a recent upside price move.  This example clearly shows how the initial bottom setup (highlighted in YELLOW) forms prior to an extended period or “basing” or bottoming price rotation.  We don’t expect many months of this type of bottoming price rotation.  We expect this bottom to setup and form over a period of about 2~3 weeks before a new uptrend begins to form.  Overall, this is a good example of how an extended bottom is formed before an upside price move initiates.

We urge you to pay attention to our posts and to visit www.TheTechnicalTraders.com to learn more about how we can help you navigate these markets.  Please take a minute to visit our website and learn how we continue to work to assist our members with clear and effective analysis, research and trading signals every day.  It really makes a world of difference when you have a dedicated team of researchers using specialized proprietary price modeling systems to help you stay ahead of these market moves.

Chris Vermeulen