Archive for category: $SPY

If you are a Bitcoin fan or looking for the next opportunity for a Bitcoin rally, you may not have long to wait before a price breakout takes place.  Our research team, at www.TheTechnicalTraders.com, believes a price breakout may occur before the end of 2018 – the only question is will it be a breakout rally or a breakdown crash before the next mega rally?

Cryptos and, in particular, Bitcoin has increased in popularity and adoption over the past 24 months across the globe.  Recently, Citigroup has announced new technology making Crypto transactions more secure and reducing the risk of such transactions.  Additionally, Circle recently announced a US Dollar based Crypto-currency that is backed by Goldman-Sachs.  News from Europe is that the EU has been urged to adopt common Crypto-Currency rules that will fuel more attention and enterprise on developing suitable Crypto solutions for the European markets.

All of this plays into our research that a breakout/breakdown is inevitable and it is just a matter of time before this coiling price consolidation “apexes” and expands.

This chart shows massive breakdown washout below $6000 taking it back to prices before crypto became popular in early 2017.

 

This next chart below shows our cycle analysis and how much bitcoin moved from our cycle bottoms to tops. We are now at NEARING a critical juncture of a $6000 breakdown which is clearly a support level, and a potential major cycle bottom or continuation down cycle. Huge money can be made from this extreme volatility that is about to unfold and savvy technical traders can see the profit potential unfolding.

 

We urge all traders to keep Cryptos in focus over the next few weeks and months.  Our research team shares our proprietary analysis and research with our paid members regarding the Crypto-currency trends and trades.

If you want to learn what we believe will be the next big move in the Crypto markets, then visit www.TheTechnicalTraders.com to learn more.  Our proprietary modeling systems are clearly showing us what we should expect over the next few weeks and months.  As a member, you will have access to this research and benefit from our Daily Research Videos.

Chris Vermeulen

The recent downward price swing in Gold has kept Goldbugs frothing at what they believe is a very unusual and unexplained price function in the face of so much uncertainty throughout the globe.  With Turkey, Russia, China and many others experiencing massive economic and currency crisis events, Gold has actually been creeping lower as the US Dollar strengthens.  It is almost like a “Twilight Zone” episode for Gold Bulls.

The setup for a gold rally has been in place for over a decade.  Much like in 2006 through 2008, the current price and volatility of Gold is simply mundane.  For the past two years, Gold has rotated between $1190 and $1360 – within a $180 range.  Certainly, Gold traders were able to find some profits within this range, but no breakout trends have been established since early 2016 when the price of Gold changed from Bearish to Bullish and a 31% rally took place driving prices $328.80 higher from the lows.

Our team of researchers, at www.TheTechnicalTraders.com, believe something very interesting may be taking place in Gold right now – almost like a “Deja Vu” of the past.  A double setup appears to have taken place recently and we believe the bottom may have already formed in Gold for now.

In early 2016 through November 2016 where price rallied 31% then retraced nearly 75% to form the second leg higher.  This deep retracement of price was indicative of a wide price rotation before another leg higher pushed back up to near the all-time highs.

From 2017 until now the Gold chart shows another 75% price retracement from recent highs once again.  This second 75% retracement could be a massive bottom formation setting up in Gold and could be a huge “wash-out” low price.  We believe this unique retracement is indicative of a massive price breakout over the next year or so as the price of gold is forming what Stan Weinstein calls a Stage 1 Accumulation.

 

Now, let’s zoom in and take a look at the weekly chart and our Adaptive Dynamic Learning model, the predictive analysis suggests that Gold prices should begin to bottom within the next week or two and begin to climb much higher over the next 3~10+ weeks.

This pattern consists of 12 unique instances of data and suggests that the future upswing will start rather mild for the first 2 weeks, then begin to accelerate as time progresses.  It appears we have a strong potential to see prices above $1400 within the next 5~8 weeks or so and you look at the previous chart above, what is the $1400 level? You got it! Resistance, and if price breaks out above $1400 a new bull market would be triggered!

As many of you are aware, Gold is often a move to safety when the global economy begins to show signs of chaos or weakness.  We believe the move in the US Dollar will stall and possibly correct as this move takes place.  If Gold were to rally while the US Dollar continued to strengthen, you can clearly assume that a flight to safety is taking place and it includes a massive capital migration toward US equities and GOLD.  If the rally in gold is seen while the US Dollar weakens or stalls, then we are seeing a move to safety while the currency markets address regional and global currency market issues.

Either way, we expect Gold to begin a new rally higher off of this 75% retracement level to complete the Pennant formation that is currently set up for a Wave 5 upside price expansion. Some of this technical analysis may be over your head as it can be confusing, but you should get the gist of things which is that precious metals should find a bottom and there is the potential that a massive bull market could be on the horizon if price rallies quickly. Be prepared for this move because the Gold shorts will likely be forced to cover their positions within the next few weeks as this move begins to accelerate higher.

Visit www.TheTechnicalTraders.com to learn how we can help you find these types of swings in the major markets.  We alert our clients well in advance of these swings and deliver daily video content to all of our members before the market opens each day.  Our objective is to make you a better trader and to help you find successful setups to create greater success.  Visit our website to learn how we can help you become a better trader today.

Chris Vermeulen
Technical Traders Ltd.

Recently, the Solar Energy sector has popped up on our watch-list of potential sectors to pay attention to.  Over the past few weeks, the Solar Energy sector has been under some pricing pressure and has retraced nearly 50% of the previous trend across the sector.  We, the research team at Technical Traders Ltd. understand the Trade War and uncertainty resulting from geopolitical tensions can sometimes create opportunities in the markets for all traders/investors.  We just have to be smart enough to find them end execute them efficiently.

Is Solar Energy the next big trend to hit in the Energy sector?  What is the potential for these stocks to move 10%, 20% or even 30%+ higher?  Let’s take a look.

This first chart, a Weekly chart of First Solar (FSLR) presents us with an interesting price setup.  After a dramatic price decline in May and June of 2018, the price decline abruptly halted near $52.00.  In fact, this downside move ended almost as if prices “legged down” to the last known true support level.  Historically, looking all the way back to the lows of 2012, this downside move represents just a little over a 38.2% retracement from the highs and coincides almost perfectly with a 50% retracement from the lows in 2017.  These two numbers interest us because they show us that $53.50~55.00 is very likely a strong support level that is currently being tested.

Simple Fibonacci expansion analysis tells us any upside potential could target $61.35 (+12.65%), 69.95 (+28.44%) & 76.20 (+39.99%).  These levels don’t take into consideration the potential for new breakout highs above $82.50.  If this were to happen, we could see a +50% or more price upside happen.

 

Before we get too far ahead of ourselves, what would cause the Solar sector to begin a price advance at this stage in the economy?  Renewed interest in the new technology of new infrastructure/government contracts?  Replacing older technology with newer, higher performance, technology?  Renewed interest from personal and corporate clients?  What could cause this move?

You may remember that we’ve been suggesting that capital, cash, is always attempting to find solid sources of growth and opportunity while avoiding risk and depreciation.  We’ve been suggesting that the spare cash on the planet has been rushing into the US stock markets by the boatload to take advantage of the strong dollar and the strong US stock market values.  Could it be time for that capital to shift away from the FANGs and other leaders and move back into opportunistic equities that are somewhat off the radar?

Earnings for these companies for Q3 are set to be announced near October 28, 2018.  With FSLR, the Q3 earnings have typically been fairly strong.  One could attempt to assume Q3 2018 sales value may surprise the markets again and this could be a good time to consider the Solar Sector as an opportunity.

Our next chart is a Weekly ETF chart of INVESCO SOLAR (TAN).  This chart presents a similar picture as the previous chart – a relatively strong pullback from April~June of 2018.  The price pullback ends near a 50% Fibonacci retracement level and coincides quite nicely with our Tesla Vibrational Price Arc.  We’ve drawn an arrow on the chart that suggests where we believe prices could be headed as long at this $21.75 support level holds.

Again, it does not take a genius to understand that any price advance from the $22.70 level to above $26.00 (or higher) would represent an almost +15% move.  Any move above $28.00 from current levels would represent a +23.34% move.  There is room for profits if our analysis is correct.

 

Lastly, we want to highlight what might be the most interesting setup in the Solar sector so far – Canadian Solar Inc (CSIQ).  This Monthly chart attempt to show our readers exactly what has been transpiring in the Solar Sector for the past 5+ years.  After peaking in early 2014, Solar technology lost its sparkle with investors.  Slowly, over time, prices waned and dropped while attempting to find support.  Technically, we view that support as the lows established in 2016 (prior to and near the US Presidential elections).

After that point it time, it is pretty clear to see that some renewed interest in the Solar Sector began to take place.  Slowly, price advanced from the low as volume stayed somewhat muted.  New rotational highs were established while the most recent low is still testing the 2016 lows.  This tells us that the price trend, at least until we see a new breakdown low, is attempting to move higher.

CSIQ is currently trading near $14.75 and has upside potential above $21.00 on a breakout move.  We are not saying this is definitely going to happen, but we do believe the Solar sector is setting up for an upside move and we do believe the potential for a new rotational high price to be established is quite strong.  This means, finding the proper entry point and understanding the downside risk of these trades is critical.

Once CSIQ breaks our Red downward price sloping line, we would assume the price channel has been broken and we would expect the price to begin to rise dramatically.

As a member of our subscription services, you will be alerted to these, and other triggers, as our research team identifies them for the best chances at future success.  Please take a minute to visit www.TheTechnicalTraders.com to learn how we can help you find new opportunities in the markets and stay ahead of these trends.  Our most recent trade in UDOW returned 12.6% for our members last week.  Please take a few minutes to understand how a small, dedicated, team of researchers with 53+ years of experience can make a difference in your future.

Now, we are ready to share some new research that will help all of us understand the current and future market conditions given the ratios of the capital markets to GDP as represented in our previous article Part I.  The research team at www.TheTechnicalTraders.com believe we have identified a means of structurally understanding the US capital markets in relation to risks or reversal and crisis contagion.  As the Buffet Indicator is now warning that the US capital market may be nearing a critical price top, we can now attempt to put this data into perspective in relation to capital flows and capabilities.  Yes, in terms of historical price appreciation, we are now at or near levels that have historically been associated market tops and price collapses.  Let’s look at how the Buffet Indicator has reacted at times using our new Custom Market Cap Volatility Index.

 

This Daily Custom Market Cap Volatility Index shows data from 2016 until now.  It clearly shows the deeper price rotation near the elections in 2016 and the deep price rotation in February 2018.  Let’s compare these levels to the Buffet Indicator reactions.  In 2016, the Buffet Indicator fell nearly 15% as the US stock market indexes fell 13.5%.  In February 2018, the Buffet Indicator fell nearly 8.5% as the US stock market fell 11.88%.  Our Custom Market Cap Volatility index operates as a range of price rotation that assists us in determining if and when the price is outside normal price ranges.  We are attempting to map price appreciation in relation to volatility in a historical form.  When price retraces or contracts, volatility spikes higher.  With this process of volatility increasing and price decreasing, the increased VIX levels will show up as very deep Custom Market Cap Volatility price corrections.  The VIX will increase much faster than price will collapse, thus any price collapse will likely stay within these ranges, or fall outside these ranges if the price collapse is more extended.

Extended price collapses will result in much higher VIX levels while prices continue to decrease.  If the price collapse is very aggressive, the increase in VIX will shoot higher and our Custom Market Cap Volatility Index will crash to very low levels.  If the price collapse is an orderly price decline, then the VIX levels will increase as price decreases more gradually and the Custom Market Cap Index will likely stay within moderate ranges.  At least we hope this works as we are suggesting.  Let’s take a look a longer-term data.

 

This Weekly Custom Market Cap Volatility Index shows the same date range as the previous Daily chart.  We should be able to see the Blue channel levels that originate much earlier as normal price channel ranges.  We have added a Std. Deviation channel to this chart originating from the 2010 lows that show the range as associated by the deviation ranges.

This data tells us that US stock market prices have recently rallied from near the middle of these historical channels and still has quite a bit of room to the upside.  This would indicate to us that the US stock market is not overly priced and that capital is still working into the US stock market in ways that support further price appreciation.  Once price reaches above the Std. Deviation channel and above our Blue price channel levels, then we would start to become concerned that prices may retrace as they did in February 2018.

Take a look at the rally from 2016 until now.  Notice how the lows near 2016 represented a relatively depressed price channel range with our Custom Market Cap Volatility Index. In other words, prices were hovering near the lower channels with no real signs of risk as prices did not collapse below these levels.  One correlation we can make with the Buffet Indicator that may become evident in our Custom Market Cap Volatility Index is that as US Bond rates increase, capital is usually moving away from the stock market and into Treasuries.  When we consider the past actions of the US Fed and the correlations of the Buffet Indicator to these central bank actions – we might find a direct correlation.

Yet we believe our Custom Market Cap Volatility Index is valuable for a number of reasons; first, we can use this index as a measure of price rotation and standard deviation low price identification. This will allow us to determine when prices are poised to form a bottom setup and when an opportunity exists for upside price acceleration.  Second, we can identify when prices are nearing the upper channel as an early warning that prices may be attempting to hammer out a longer-term top formation – allowing us to reduce risk and scale back our positions.  Lastly, we can look for cycles that may help us determine key dates for price rotation.

This cycle chart highlights the deeper low price rotations in our Custom Market Cap Volatility Index.  These low points are when the US stock market has seen increases in volatility and moderately deep or deep price corrections.  Notice how the early 2018 price collapse is clearly shown as a very deep price rotation in our Custom Market Cap Volatility Index.  Notice how the 2016 and 2017 deeper price rotation on the Custom Market Cap Volatility Index correlate with price rotation in the US major indexes.  Also, pay attention to the price appreciation that took place after these deeper price corrections.

These cycles suggest that the US stock market should continue to push higher for at least the next 90+ days till near November 2018.  Near this date, there is a relatively strong likelihood that some type of deeper price correction will hit the US markets – possibly a bit sooner or after this date.  The cycle frequency and accuracy of these bottoms suggest that the price of the US stock market will likely push higher over the next 30+ days – then possibly stall while attempting to form a potential top.  It is likely that this top formation or horizontal price range will become extended consolidation before any deeper price correction begins.  In the meantime, we believe the US stock market will continue to push higher as our Custom Market Cap Volatility Index shows.

Our suggestion at this point is that the Buffet Indicator is failing to correlate the global capital pool that exists currently and is also failing to adequately reflect the capital migration that is currently taking place throughout the globe.  We believe the US stock market could continue much higher at this point, depending on how the global markets react to this shift in capital and the longer term debt issues that are playing out.  We certainly don’t want to mislead anyone – so we are alerting you that November or December of 2018 appears to be a time where prices may rotate a bit more violently to the downside.  This may be correlated to some type of global crisis event or it could be an extended capital shift away from the US stock market where capital flees to new opportunities in other global markets.  All we know right now is that the US stock market is still on a path to move higher and we still have quite a bit of room for market cap growth over the next 3+ months.

If you want to know how our other proprietary price modeling systems and indicators help us keep our valued members and subscribers informed of future market moves, then visit www.TheTechnicalTraders.com to learn how we can help you find and execute better trading decisions with our specialized research, daily video updates, detailed trading signals and more.  Don’t let the other news fool you with generic content and comments – true researchers pull from resources or create new resources to give them a much clearer understanding of the market dynamics ahead.  Get ready for further upside prices and watch for an end of year price rotation that could be dramatic.

53 years experience in researching and trading makes analyzing the complex and ever-changing financial markets a natural process. We have a simple and highly effective way to provide our customers with the most convenient, accurate, and timely market forecasts available today. Our stock and ETF trading alerts are readily available through our exclusive membership service via email and SMS text. Our newsletter, Technical Trading Mastery book, and 3 Hour Trading Video Course are designed for both traders and investors. Also, some of our strategies have been fully automated for the ultimate trading experience.