Archive for category: $SPY

The financial markets have already “priced in” huge tax cuts, reducing red tape regulations and a massive increase in infrastructure spending.

Perhaps, the markets are now believing that the agenda is not going to occur with Al Green asking for Trump impeachment?  This could result in a significant downturn for stocks if it were to unfold.

The SPX index declined more than 1.75% and wiped away about $375 billion in market value. The SPX went from a record close three days ago, to below its 50-day simple moving average on Wednesday May 17^th, 2017.  Institutional traders view the 50-day simple moving average as very strong trend support. The SPX level at 2407 turned out to be the best the bulls were capable to achieve. Their second attempt to push the benchmark higher failed at 2406, where the bears stepped in.

Financial Markets are Spooked!

There is a slow leak in U.S. stocks. The SPX has more declining stocks than advancing ones during this tight trading range. This is unusual behavior and resulted in lower returns over the following month.  Tune in every morning for my video analysis and market forecasts on all ‘asset classes’ so you know where and why the market is about to move.

The SPX decline on Wednesday May 17^th, 2017, was abnormally large, relative to the past 3 years.

These two market warning signs, the “Titanic Syndrome” and the “Hindenburg Omen” are giving a “preliminary sell signal” based on analyses of 52-week New Lows in relation to New Highs on the NYSE. On May 4^th, 2017, the Hindenburg Omen was triggered on the NYSE and Nasdaq exchanges.  It has a consistent record at highlighting underlying weak market conditions that preceded market trouble. On May 16^th, 2017, both exchanges triggered the Titanic Syndrome. This occurs when the NYSE 52-week lows out-number 52-week highs within 7 days of an all-time high in equities within days of the major indexes closing at a one-year highs. Historically, these signals have led to further weakness over the following two weeks. As stocks were plunging, investors are currently panicking out of stocks and into the “safety” of bonds.

Is This The Return of New Volatility?

Richard Haworth, CIO of Capital Advisors, a London-based hedge fund, which bets on rising price swings is quoted as saying, “The market will revert to higher volatility and this could be the start of it. The sharp move this week reflects how low volatility the market was — how complacent.”

Conclusion:

In short, investors have been overly bullish with virtually no fear that share prices could fall.  But this weeks drop seems to have renewed the fear and is cleansing the market by weak investor shares being sold to those who are bullish and willing to hold them for higher prices.

This is normal bullish price action and once this phase ends higher prices should return as we enter the summer months.

In the past week over at ATP service we have closed a few winning trades whie the market sold off. SLV 3.2% profit, FOLD 9.5%, MOBL 15%, and ERY 5.4%.

The bottom line is that it really does not matter which way the market goes, there will always be ways to profit.

Chris Vermeulen
Daily Market Price Forecasting Video
Active Stock & ETF Trading

Stock Market Forecast Big Picture: The broad stock market is working through a more complex corrective price pattern. My recent forecast, as displayed in the chart below, indicates that the next leg up is toward 2500.  The market may be about to start a larger A-B-C correction to test the 2300 level to fully cleanse itself, before starting the next leg up. But overall, the SPX is very bullish long-term.

Investors are among the most pessimistic they have been in 7 years!  Over the past four weeks, this sentiment is nearing the lowest of all readings of the past 30 years. If it declines a bit further, it will suggest future returns of the SPX will be impressively positive over the next couple months.

Courtesy of TMTF service

Federal Tax Revenue Falls to 80-Month Low!

The last time that Federal receipts fell this much was, in July of 2008, right before the “financial crisis”.  March of 2017 was the fourth month, in a row, in which federal receipts were down year over year, while growth rates overall have been falling quickly since mid-2015.  This a RED FLASHING warning sign that all is not well in the U.S. economy.

What is their solution?

Private Collection of Overdue Federal Taxes Begins this April.

The Internal Revenue Service, IRS, announced earlier this month have hired four debt collection agencies to collect on outstanding payments from taxpayers. The IRS now has employed private debt collection firms to contact taxpayers who still have not paid their previous years’ taxes.

Households and employees apparently are NOT doing nearly as well as they have been told they are! I wonder if Chairwoman Yellen and Company. ( https://mises.org/library/end-ultra-easy-money), are aware of all of this?  To my naked eye, this does not look like economic growth nor a healthy economic recovery!

What we have invented, in order, to keep big banks afloat, for a while longer is ultra-low interest rates, NIRP, ZIRP, etc. They create the illusion of not only growth, but also of wealth. They make people believe that a home they could never have dreamt of otherwise buying not long ago is possible to fit into their ‘budget’. This is how they are lured into signing up for ever larger mortgages, which, in turn, keeps our banks from falling over.

Record low interest rates have become the only way that private banks can create new money and stay alive (because at higher rates barely anyone would be able to afford a mortgage). It is of course not just the banks that are kept alive, but the entire economy, as well.

I really do not think that we are actually returning to normal interest rates under these circumstances. I believe that based on this overview, proper interest rates in the FEDs future are going much lower than it has been historically.  The FED is now going to now realize that it cannot buy itself out of a “business cycle” and that an “old-fashioned” deflationary depression is upon us, now!

The International Monetary Fund, (IMF), released a report that is projecting a prolonged period of low interest rates and low growth that has gripped the global economy since the 2008 financial crisis. This would force major structural changes of pension funds, asset-management firms and insurance companies. Their products and business models, under lower growth and low interest rates, will have to be radically revamped!  Pension funds, insurance companies and the future of investing all will likely have to change significantly: (https://www.bloomberg.com/view/articles/2017-03-24/pension-crisis-too-big-for-markets-to-ignore). Defined-benefit pension plans would have to start reducing benefits. Insurance companies will have to reinvest in maturing assets at lower yields while continuing to make high payouts on their policies.  Today, they are acting more like hedge funds than their traditional roles. They will most likely require more capital to stay solvent.

The IMF Global Financial Stability Report stated, “The experience of Japan suggests that an imminent and permanent exit from a low-interest-rate environment need not be guaranteed. That would pose “a considerable challenge to financial institutions.” The Trump Rally Will continue🙁 http://www.barrons.com/articles/are-you-ready-for-trump-rally-2-0-1492634005)

Live The American Dream!

Are you living hand-to-mouth or paycheck-to-paycheck? This all is too common a reality for U.S. workers.  Three-quarters of the population are scrambling to cover their basic living costs.  This next problem that Wall Street is about to experience can actually help you to make money, if you understand it and do exactly what we are doing.

Tune in every morning for my video analysis and market forecasts at TheGoldAndOilGuy.com on all ‘asset classes’ and new ETF trade opportunities.

Chris Vermeulen
www.TheGoldAndOilGuy.com

The United States is the world’s largest and most diversified economy! It is currently suffering through a protracted period of slow growth which has held down job creation and labor market participation.  The Pew Research Center reported, in late 2015, that a mere 19% of Americans trust the government either always or most of the time.

The FED must print more money in order to keep the party going forward.

The bottom line is that this current bull market has been driven mostly by corporations which are buying back their shares, over the years. Individual investors have increasingly been moving out of equity mutual funds and into equity ETF’s.

The Congressional Budget Office (CBO) reported that in fiscal year 2016, the federal budget deficit increased in relation to the GDP, for the first time since 2009. The CBO projects that over the next decade, budget deficits will follow an upward trajectory. The spending costs for retirement and health care programs targeted towards senior citizens, and rising interest payments on the government’s debt will be the root drivers. There will be only a modest growth in revenue collections. This will drive up public debt to its’ highest level of gross domestic product (GDP) since shortly after World War II ended.

The Congressional Budget Office stated that the nation’s public debt will reach 145 percent of gross domestic product by 2047

Conclusion:

The BULLISH Trend in the stock markets is not reversing in the near future.

The stock market is on an upward trajectory.  Are you wondering what you should do next?

Do you want to gain the edge that you need in order to beat the markets an profit during both rising and falling prices?

Take advantage of my insight and expertise as I can help you to grow your trading account. Tune in every morning for my video analysis and market forecasts at TheGoldAndOilGuy.com on all ‘asset classes’ and new ETF trade opportunities.

I always take half off of the table, on all positions, to lock in quick solid gains and then ride out the other half for much higher returns!  I manage my risk while keeping profits!

Chris Vermeulen
www.TheGoldAndOilGuy.com

The “real”  Atlanta Fed’s reading of Q1 GDP   went off a cliff to less than 1%:

No one has the slightest idea of what is happening as insane levels of debt distort the model’s which economists use to forecast the future economic trends. From here on out, there will be unpleasant surprises all the way around. According to shadow stats, the GDP is in contraction at the rate of -2%.

The New Normal & Disconnect:

The FED and other agencies have taken on new responsibilities for managing systemic risk since the financial crisis of 2007.

What grade have they earned?  The impact of implemented low-interest rates for savers has made them poorer. All pension plans, college endowments, and state retirement plans have been diminished and devastated by low-interest rates. Savers have suffered and will continue to do so because of ‘financial repression’.

Furthermore, because low-interest rates make savers poorer, the contracting economy has limped along with anemic growth rates. Low-interest rates have had a negative impact for almost everyone.

Preparing For The Big Crunch!

The FED will respond with even more aggressive money printing — which will then cause the entire monetary system to implode some day.  Money is not wealth, but rather it is merely a claim on wealth.  Debt is a claim on future money.  The only way to have faith in our current monetary policies is if one believes that we can grow our economy and GDP out of this massive debt that we have created.  The U.S. is already insolvent, meaning liabilities exceed assets.  The U.S. has been spending, far beyond its’ means, for multiple decades while amassing tremendous amounts of public debt, private debt and entitlement liabilities.

The Austrian economist Ludwig von Mises said, “There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.”

U.S. economic growth began slowing down due to its’ acceleration of ‘too much debt’. Instead of allowing natural market forces to clear out the excessive debts, the Federal Reserve chose to go into overdrive to ‘remedy’ the problem. Its’ remedy? Drive interest rates to 0% to reduce the service burden of those debts and print trillions of fresh dollars which, in turn, would fund new borrowing.

Of course, no true ‘solution’ for resolving debt involves piling up even more of it.  The only path that history has shown that works involves fiscal austerity and reducing debt. The only real solution is “a voluntary abandonment of the credit expansion”.  

The only possible solution for recovery, today, is if the economy suddenly returns to an extremely rapid economic growth over an extended period of time.  If during such a period of rapid growth does occur, we must use that windfall to pay down the outstanding debts!  The intent of the FED treading into the never-before-tried ZIRP and NIRP waters was to ignite more borrowing, not more spending!

Pension plans have been ultimately decimated by these monetary policies!

Pension funds across the U.S. are desperate to overcome low interest rates and return to the time when future retirees were entitled to and could receive their full benefits. Pension funds which so many depend upon for their retirement security will lose trillions of dollars which will result in the depletion of receiving their benefits!

The chart below reflects the last two times that industrial and commercial loan contracts crashed which were in 1999 and 2007!{25 year chart} of all American Bank Commercial and Industrial Loans.The last 2 times loans contracted and broke down was 1999 & 2007

Making Real Profits!

Want to gain the edge you need to beat the markets? Or Better yet, profit during the next market correction through the use of Inverse Exchange Traded Funds?

Take advantage of my insight and expertise as I can help you grow your trading account. Tune in every morning for my video analysis and market forecasts at TheGoldAndOilGuy.com on all ‘asset classes’ and new ETF trade opportunities.

I am currently in a gold related trade. The last gold trade that I provided, returned a trade with NUGT resulting in an 112% Profit From Dec – Feb.

We use a combination of traditional technical analytical tools, Elliot Wave Counts and investor sentiment! This makes for Killer Trades with oversized Profits!

We always take half off of the table on all positions to lock in quick solid gains and then we ride the other half for much higher returns!  We reduce our risk while keeping our gains!

It looks as though we are a couple of days away from the next major trade setup which could last several months with the potential for a 51-55% return. Be sure to keep informed by reading my newsletters and get my stock trades and leveraged ETF trades at www.ActiveTradingPartners.com