Archive for category: $SPY

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If you are a long-term investor, swing trader, or day trader, then you could find one or all of the charts below interesting. What I am going to briefly cover and show you could make you think twice about how you are investing and trading your money.

I will be the first to admit you should not, and cannot, always pick market tops or bottoms, but there are certain times when it’s worth betting on one.

Below I have shared three charts, each with a different time frame using daily, 30 minutes, and a 10-minute chart. Each chart also has a different technical analysis technique and strategy applied.

Each shorter time frame chart as we work down the page zooms in closer to more imminent price action that should take place over the next few days.

 

Daily Chart Signals Market Top – Investing/Swing Trading

The daily chart below shows a clear overall trend which is to the downside. Trends are more likely to continue than they are to reverse, hence the saying “The Trend Is Your Friend.”

A key piece of data on this chart is the blue investing cycle line at the bottom. If this is trending down or below the 50 level, then money should be focused on profiting from falling prices via inverse ETF’s, short selling, or put options.

Equally important are the yellow and baby blue cycle lines at the bottom. When these enter the upper reversal zone, we should expect sellers to step into the market and for the price to fall.

 

30-Minute Chart Signals Market Top – Swing/Momentum Trading

I apologize for the noisy chart below, a lot is going on there, but if you focus on the yellow text and drawings, it will help keep things simple.

This chart shows several reasons why we expect the price to fall. Based on technical and statistical analysis this chart points weakness over the next 1-3 trading days.

 

10-Minute Chart Signals Market Top – Momentum/Day Trading

Monday night (Jan 7^th) after the closing bell the SPY ETF chart generated a sizable price spike to the downside. Those of you who follow our spikes and or at least know about these setups then you know we expect the price to reach at least one if not all spike targets which are 30%, 50%, and 100% of the spike within 36 hours.

So far in 2019 we have has six price spikes five winners, one loser which is an 83% win rate thus far. Today’s spike is abnormally large not sure what that means regarding this one being a success but it is another spike signal, and the odds favor a move down once you see the other analysis supporting this setup.

Watch the video on how we trade price spikes: https://www.youtube.com/watch?v=jq-SrF-B8MU

 

Conclusion:

In short, 12 months I publically posted a 31-minute video on the stock market explain how 2018 would be wild and how the stock market should top out which it confirmed this a week ago when the December monthly stock market chart closed below critical support. The video goes on to explain how 2019-2020 will most likely be a bear market and economic recession, and that is exactly what looks and feels like is starting to unfold behind the scenes.

If you are boring long-term investor and have been stuck having to ride the stock market rollercoaster with your life savings my trading newsletter can help you with your long-term portfolio to not only avoid losses but profit from the collapse with one simple inverse exchange-traded fund which trades like a stock and you buy and sell it at anytime! Knowing when you put your nest egg to work, and when to back away and protect it is crucial if you want to become wealthy or become wealthy.

On the flip side, if you are an active trader looking for monthly trades then be sure to join the Wealth Building Newsletter today and receive my daily pre-market video analysis, so you understand what took place yesterday, during overnight trading, and what to expect when the market opens.

Subscribe today and become part of our trading community and prosper from the coming market correction and real-estate downturn.

Chris Vermeulen
Wealth Building Newsletter
www.TheTechnicalTraders.com

Our research team has been nailing the markets moves with our proprietary price modeling tools.  Our December 12, 2018 call that Natural Gas would collapse nearly 30% after reaching a price peak was a very bold call.  Who would have thought that predictive price modeling could be so accurate and could identify a move like this – or call for what is expected to happen next?

Back when Natural Gas breached the $4.60~4.80 range, our ADL predictive modeling system was suggesting a massive price anomaly was setting up.  These types of triggers are becoming more common as volatility in the general markets increases.  The ADL system suggested that a massive -30% downside price move would happen before the end of February 2019.

Now, as that trade has completed and our targets have been reached, we are alerting our followers that Natural Gas should begin to consolidate between $2.80 and $3.30 before attempting to rocket back above $4.00 near April or May 2019.  Read our original analysis of Natural Gas to learn why these moves provide an incredible opportunity for traders and visit  www.TheTechnicalTraders.com/FreeResearch/ to read up on our early 2019 market predictions.

Join our other members in making 2019 an incredibly successful year.  We believe 2019 will provide exceptional opportunities for skilled traders and we’ll be happy to share our proprietary research and analysis with you as a member of Technical Traders Ltd. You really don’t want to miss these moves and this incredible opportunity.  Think about it, one trade like this with a -30% selloff followed by a 24% price rally could make your entire year.  Imagine being able to find trades like this every week or month for success.  Visit www.TheTechnicalTraders.com and get ready to make 2019 a fantastic year of success no matter if we have a bull market or bear market.

Chris Vermeulen

Everyone wants to know if this selloff has reached a low or bottom yet and what to expect over the next 30~60+ days. Since October, the US stock market has reacted to the US Fed raising rates above 2.0% with dramatic downward price moves. The latest raise by the US Fed resulted in a very clear price decline in the markets illustrating the fact that investors don’t expect the markets to recover based on the current geopolitical and economic climate.

Over 5 years ago, our research team developed a financial modeling system that attempted to model the US Fed Funds Rate optimal levels given certain inputs (US GDP, US Population, US Debt, and others). The effort by our team of researchers was to attempt to identify where and when the US Fed should be adjusting rates and when and where the US Fed would make a mistake. The basic premise of our modeling system is that as long as Fed keeps rates within our model’s optimal output parameters, the US (and presumably global) economy should continue to operate without massive disruption events unless some outside event (think Europe, China or another massive economic collapse) disrupts the ability of the US economy from operating efficiently. We’ve included a screen capture of the current FFR modeling results below.

This model operates on the premise that US debt, population, and GDP will continue to increase at similar levels to 2004~2012. We can see that our model predicted that the US Fed should have begun raising rates in 2013~2014 and continued to push rates above 1.25% before the end of 2015. Then, the US Fed should have raised rates gradually to near 2.0% by 2017~2018 – never breaching the 2.1250% level. Our model expects the US Fed to decrease rates to near 1.4~1.5% in early 2019 and for rates to rotate between 1.25%~2.0% between now and 2020. Eventually, after 2021, our model expects the US Fed to begin to normalize rates near 1.5~1.75% for an extended period of time.

Additionally, our Custom Market Cap index has reached a very low level (historically extremely low) and is likely to result in a major price bottom formation or, at least, a pause in this downward price move that may result in some renewed forward optimism going forward. Although we would like to be able to announce that the market has reached a major price bottom and that we are “calling a bottom” in this move, we simply can’t call this as a bottom yet. We have to wait to see if and when the markets confirm a price bottom before we can’t attempt any real call in the markets. You can see from our Custom Market Cap Index that the index level is very near historically low levels (below $4.00 – near the RED line) and that these levels have resulted in major price low points historically. We are expecting the price to pause over the next week or so near these $3.50 levels and attempt to set up a rotational support level before attempting another price swing. As of right now, we believe there is fairly strong opportunity for a price bottom to setup, yet these are still very early indicators of a major price bottom and we can’t actually call a bottom yet. If our Custom Market Cap Index does as it has in the past, then we are very close to a bottom formation in the US markets and traders would be wise to wait for technical confirmation of this bottom before jumping into any aggressive long trades.

Lastly, our Custom Global Market Cap Index has also reached levels near the lower deviation channel range over the past 7+ years, which adds further confidence that a potential price bottom may be near to forming in the US markets. As we can see from the chart below, the recent selloff has pushed our Global Market Cap Index to very low levels – from near $198 to near $144; a -27.55% total price decline. Nearing these low levels, we should expect the global markets to attempt to find some support and to potentially hammer out a bottom, yet we are still cautious that this downward price move could breach existing support levels and push even further in to bear market territory.

There are early warning signs that the market may be attempting to form a market bottom and our research team is scanning every available tool we have at out disposal to attempt to assist all of our members and followers. We alerted you to this move back on September 17, 2018 with our ADL predictive modeling system call for a -5~8%+ market correction. Little did we know that the US Fed would blow the bottom out of the markets with their push to raise rates above the 2.0% level.

As the US Fed has already breached our Fed Modeling Systems suggested rate levels, the global markets will be attempting to identify key price support in relation to this new pricing pressure and the expectations that debt/credit issues will become more pronounced as rates push higher. In other words, the global markets are attempting to price in the renewed uncertainty that relates to the US Fed pushing rates beyond optimal levels. We expect the markets are close to finding true support near the levels we’ve shown on our Custom Index charts, yet we still need confirmation before we can call it a bottom.

We will continue to update you with our research and analysis as this move plays out and we hope you were able to follow our analysis regarding the Metals, Oil, Energy and other sectors that called many of these massive price swings. We pride ourselves on our analysis and ability to use our proprietary tools to find and execute successful trades for our members. Our ADL predictive price modeling system is still suggesting an upward price move is in the works for the US markets and we are waiting for our “ultimate low price” level to be reached before we expect an upside leg to drive prices higher again. Based on our current research, we may be nearing the point where the markets attempt to hammer out a price bottom – yet time will tell if this is the correct analysis.

Please take a minute to visit www.TheTechnicalTraders.com to learn how we help our members find and execute better trades. Recent swings in the markets have made it much more difficult for average traders to find and execute successful short-term trades. Learn how we can help you find greater success and read some of our recent research posts by visiting www.TheTechnicalTraders.com/FreeResearch/

The downside price rotation in the US markets on Monday, December 17, set up a near-perfect double bottom formation near the 2530 price level and also prompted a dramatic price recovery after reaching these lows.  Currently, the ES has rallied over 35 pts from this low level and will likely pause before the Fed minutes are announced on Wednesday, December 19.

If the Fed holds true to their earlier promises of continued rate increases, we could see this 2530 level broken as price retreats from any relief rally and attempts to find lower support.  If the Fed changes the context of their message and adopts a slower and more insightful rate policy, the markets are poised for one heck of a potential rally.  The ES if down by a little more than 400 points (-13.75%) from the peak in September 2018.

We believe the markets have already priced in the expected Fed rate hike and we believe an additional rate hike could become a catalyst for a downside move towards 2300 if the 2530 level is breached.  We would like to see the Fed pause, or even decrease rate levels by 25 bp, allowing the markets to parse through the credit/debt issues that have started to plague the global markets before it causes the markets to “turn turtle” and prompt a greater crisis event.

Some of our earlier research, from 2013~2014, was a modeling system dedicated to the Fed interest rates, GDP, Population and Asset Valuations.  We modeled various outcomes of the global economy over the future 15 to 20 years including massive debt increases, massive debt decreases, slowing GDP, growing GDP, massive changes in population and asset levels and many others.  Overall, our research showed that the 2% Fed Funds Rate level should have been an upper boundary and should have been a near-term target back in 2015~2016.  As or right now, the Fed should be decreasing rates to allow for a smooth transition through a “deleveraging process”.

The Fed is behind the curve and is failing to properly navigate the future outcomes of global assets, debt and credit cycles.  If the US Fed is not cautious over the next 12+ months with how they manage the FFR, they could push the entire global economy over a cliff faster than they can spell “Powell”.

Everything rests on Wednesday, December 19 and the US Fed at this point.  Our predictive modeling systems are still suggesting we should see strong upside price activity throughout the end of this year and early next year – assuming the Fed does not pull the floor out from under this market and capsize the global credit markets again.

Learn how we can help you find and execute trades for better success.  Our analysis has been well ahead of these market moves for months and we’ve nailed some incredible trades.  Visit www.TheTechnicalTraders.com to learn more.

Chris Vermeulen