Crude Oil Breaks Down – Target $40

Our incredible ADL predictive modeling system predicted a moderate price anomaly on July 10th, 2019 in Crude Oil.  We wrote about this oil set up on July 10th. Within this article, we suggested that Crude Oil would rotate to levels near $47~$48 rather quickly, then find some moderate support in December and January where support is likely to be found near $45 to $50. After that, the price of Oil should weaken dramatically where price could fall to levels below $30 ppb on extreme price weakness.

We believe the selling may abate or weaken slightly early next week as earnings continue to hit the news cycle and future expectations are adjusted based on this data.  Quite a bit of data will be released next week with the worlds biggest firms releasing Q2 data and Q3 expectations.  We believe this news/data will result in a brief pause in the decline of oil prices and allow traders to set up for the next move lower.

This Daily Crude Oil Chart highlights the downside price action this week as oil collapsed from the $60 upside target called from our early June oil video forecast. The chart below also highlights our Fibonacci price modeling tool that is currently suggesting support will be found just above $51 ppb – which is aligned with the previous price bottom in early June 2019.  Mild resistance is also found near $56.70 (the BLUE projected price level).  This level will likely act as a “congestion range” as price rotates and attempts another downside leg.

This Weekly Crude Oil chart highlights the bigger picture for oil.  The recent breakdown in price has just crossed the Bearish Fibonacci trigger level (RED LINE near $55.20) and this breach suggests the downside price move may just be starting. Ultimate downside targets near $40 to $44 are where we believe the price will find support over the next 30 to 60+ days.  Beyond these levels, the price may continue much lower and eventually breach the sub $30 level in Q1 or Q2 of 2020, which would likely be a strong cause of the pending bear market.

CONCLUDING THOUGHTS:

Any deep downside price move like this in Crude Oil would suggest that economic weakness and supply/demand issues are the root causes of a Crude Oil price collapse.

If the downside move continues as we are suggesting, many foreign nations will come under extreme economic pressures and currency levels/support could become threatened as the foundation for many oil-based economies will begin to crumble.  This could create an extreme debt/credit issue for many nations throughout the planet and could push the US Dollar well above $100.  The implications for extended trends and trades is incredible when you consider the scope of the economic shift that will take place if Crude Oil does begin trading below $30 in early 2020.

$30-$40 crude oil could spark or further deeping the pending bear market which has been a long time coming. Almost all the signs are showing that it’s about to start so get ready. If you want someone to guide you through the next 12-24 months complete with detailed market analysis and trade alerts (entry, targets and exit price levels) join my ETF Trading Newsletter.

Chris Vermeulen
Technical Traders Ltd.

Gold And Us Stock Mid Term Election And Decade Cycles

GOLD MIDTERM YEARS AND SEASONALITY

Let’s start off with the price of gold and what it typically does each month during the presidential midterm year, which is this year 2019. The graph below shows the average price movement during the midterm election since 1971 and I think the chart speaks for its self.

What I get from this, is that investors become uncertain with the future and accumulate gold.

This next chart is the seasonality of gold. Meaning which direction gold trades during each month on average every year. This second chart along with the midterm chart above both show gold tends to pull back the second half of July, so don’t be alarmed if it happens.

DOW JONES MIDTERM YEARS

The US stock market in general, but in this case, I’m using the Dow Jones industrial average you can see where stock prices should move during the rest of this year as we go into the November election.

DOW JONES DECADE CYCLE

As you may or may not know, I have a thing with cycles when it comes to trading. Yes, it seems a little far fetched and can be perceived as Voodoo to some people but statistics don’t lie and I have made an incredible living from the financial markets incorporating cycles in all my trades from long term investing right down to my 30-minute trading charts.

The website SeasonalCharts.com shares this really interesting information and chart about the decade cycle and I want to share it with you here:

“The stock market appears to follow a 10-year cycle. During the first half of the decade, equity prices on average do not increase, however in the second half they clearly do. In addition, U.S. equities have demonstrated very good performance in years ending with the number 5 (e.g. 1995 or 2005). Their average profit amounted to 30 %. That equals 40% of the average profit for the entire decade! 

The decade-cycle chart of the Dow Jones shows the average 10-year trend of the index over the last more than 100 years.” 

As you can see from those four graphs the odds are pointing towards a market top in the US stock market based on statistics and long-term cycles. And for gold to become the investment of choice and rally the second half of this year.

Below are several other eye-opening charts about gold and US equities. You should take a quick look at each because what I’m sharing in this post and links below is more than enough to know where the markets are headed next. No need to look anywhere else and I think you will agree after you review each section. My analysis is logical, proven, and easy to understand the big picture trends no matter if you are a total newbie to the trading and the financial markets.

CONCLUDING THOUGHTS:

In short, you should now have a firm grasp of where stocks are headed along with precious metals for the next few months and beyond. The next step is knowing when and what to buy and sell as these turning points take place, and this is the hard part. If you want someone to guide you through the next 12-24 months complete with detailed market analysis and trade alerts (entry, targets and exit price levels) join my ETF Trading Newsletter.

In short, the bear market has been a long time coming, but finally, almost all the signs are showing that it’s about to start. As a technical analyst since 1997 having lost a fortune and made fortunes from bull and bear markets I have a good understanding of how to best attack the market during its various stages.

Chris Vermeulen
Technical Traders Ltd.

Double Top In Transportation And Metals Breakout Are Key Topping Signals

Double-Top patterns are very important in terms of Fibonacci price structure because they reflect a complete price rejection at a certain price level.  In this case, the TRAN Double Top level is $10,655 and our research team believes weakness at this level will push a downward price swing which should attempt to break through the $10,250 level and possibly attempt to move much lower.

The Transportation Index reflects future expectations for shipping of goods and raw materials across the US and, of course, is somewhat related to global economic activity.  If the Transportation Index falls in price, then future expectations are for weaker economic activity.  If it rises, then investors expect the economy to continue to strengthen.

This Double-Top formation in the TRAN could set up to become a very ominous warning sign for traders and investors.

Recent news about the contraction of China’s economy and the fact that Q2 earnings are about to hit the US markets and global markets could become a key factor in the future for volatility and price.  We believe the markets are already setting up a topping pattern after breaching key psychological levels last week.

MINERS ARE OUTPERFORMING US EQUITIES – TOP IS NEAR!

Last month I talked about how I have been waiting for gold miners to start outperforming the US stocks market. Once miners start outperforming in a big way (just like we saw in 2007), we know the stock market is topping out and something really bad is about to happen.

In the last couple of weeks, the gold miners index is up over 20% while the SP500 is up only 4%, this feels like the start-of-the-end if you know what I mean.

Gold miners and silver broke out today in a big way which could very well be the start of an epic rally for the precious metals sector as we heading into the end of the year.

Looks at the SP500 index in the chart below which is of the 2007 bull market top. Currently, the SP500 has formed a very similar pattern in 2019 and with the precious metals rocketing higher I think it almost lights out for the US equities.

See my updated chart showing where gold miners and the stock market is today within this cycle:  https://www.thetechnicaltraders.com/next-bull-and-bear-markets-are-now-set-up/

TRANSPORTS, INDUSTRIALS, AND SMALL-CAP STOCKS CONFIRM MARKET IS TOPPING

Based on the 2008 weekly chart below the US stock market could be literally 2-6 weeks away from collapsing. What makes this even scarier is that the market liquidity is the worst its been in my 23 years of trading. This means when the selling starts we will likely see some sort of flash crash as we saw in 2008, 2015, and 2018. Price drops so quickly that by the time you figure out what you want to do and get your money properly positioned most of the move is already finished. See 2008 and 2019 Comparison Charts here.

CONCLUDING THOUGHTS:

Pay attention to our research because we feel the market could breakdown on weakness later this week or early next week.  Our predictive modeling systems are suggesting an August 19th, 2019 breakdown date and we are only about 25 trading days away from that date.

In short, the bear market has been a long time coming, but finally, almost all the signs are showing that it’s about to start. As a technical analyst since 1997 having lost a fortune and making a fortune from bull and bear markets I have a good understanding of how to best attack the market during its various stages. Stay Tuned for My Cycle Analysis Article Next! 

Financial Crisis Bear Market Is Scary Close

Everyone is playing the game of musical chairs and getting creative with how they borrow, lend, create, and steal money in hopes the world does not catch on to just how corrupt and bad things really are.

It’s just a matter of time before we see another financial market meltdown and what I show you here today gives you an idea of just how close we could be to a market collapse.

The financial markets rarely repeat the same type of crisis, but most crisis’ cause the stock market to sell off and crash in the same way. Human nature and emotions do not change, and because traders and investors drive the price action of stocks we are able to profit from bear markets.

In fact, bear markets can be life-changing in a good way for those who know how to trade these market conditions. Because stocks fall 3-7 times faster than they rise, you can generate the same amount of returns someone who invested at the beginning of a 10-year bull market and sold at the top, but you can do this in 8-12 months because of how quickly prices fall.

THREE LEADING SECTORS TO WATCH 
TRANSPORTS, INDUSTRIALS, SMALL-CAP STOCKS

The transportation sector refers to the transportation of goods or customers using major and regional airlines, railroads, shipping firms, ocean freight haulers, trucking, etc… It is these companies that see a slow down in the economy before almost everyone else as less shipping is required when sales slow or the economy is tightening using less food, fuel, or buying things in general.

The second sector is industrials. This works much like the transportation sector.

Last but not least is the Russell 2ooo small-cap stock index. These small and volatile stocks are the first to show signs that traders and investors are tightening their risk-reward ratios because they feel the stock market is overpriced and that a bear market could be near, and the last type of stock you want to own during a bear market are small-cap stocks.

2016 – 2019 CUSTOM CHART OF THREE SECTORS
TRANS (IYT) + INDUSTRIALS (XLI) + RUSSELL (IWM) / 3

The chart below shows the recent and current day price action of these three leading sectors. Notice the long multi-year rally into the high of 2018 followed by the sharp distribution selling that warns the big money players unloaded their positions in these leading and leveraged sectors.

The 2019 rally has been strong but when you look at the big picture, the price is far from its 2018 highs and the price pattern is bearish (it points to lower prices) from a technical analysis standpoint.

2004 – 2008 CUSTOM CHART OF THREE SECTORS

The last bull market looks nearly identical in terms of the run-up in price, the top in 2007, and the distribution sell-off in these sectors. The 2008 rally was strong as well, but far from the 2007 highs as well.

What I want you to notice is the fact that these charts have moved nearly the same. Just like I mentioned earlier how bear markets price patterns repeat, so do bull market price patterns. The 2009 price action and 2019 price action are nearly identical and when you see the next chart you will see why the financial market is scary close to the next crisis/bear market.

2009 MARKET CRASH CUSTOM CHART
TRANS (IYT) + INDUSTRIALS (XLI) + RUSSELL (IWM) / 3

Bases on the 2008 weekly chart below the US stock market could be literally 2-6 weeks away from collapsing. What makes this even scarier is that the market liquidity is the worst its been in my 23 years of trading meaning when the selling starts we will likely see some sort of flash crash as we saw in 2008, 2015, and 2018. Price drops so quickly by the time you figure out what you want to do and get your money properly positioned most of the move is already completed.

EYE OPENING GOLD MINERS CHARTS AND ANALYSIS FROM 2008-09

There are several other really intriguing things happening that further confirm this analysis like how gold miners are outperforming US stocks, the gold : silver ratio above 85, the presidential cycle, the decade cycle and many more. It was actually all these other things that made me review these leading sectors here today. I’ll touch on these other topics in the next few articles later this week

The chart below shows you what the stock market and gold miners did just before the bull market topped and what they did after. Be aware, if you’re a gold bug you may not like this chart but you can’t argue with the truth of what miners did during the bear market and other bear markets for that matter.

See my updated chart showing where gold miners and the stock market is as of today within this cycle:  https://www.thetechnicaltraders.com/next-bull-and-bear-markets-are-now-set-up/

CONCLUDING THOUGHTS:

In short, the bear market has been a long time coming, but finally, almost all the signs are showing that it’s about to start. As a technical analyst since 1997 having lost a fortune and making a fortune from bull and bear markets I have a good understanding of how to best attack the market during its various stages. Stay Tuned for Part II 

Be prepared for these incredible price swings before they happen and learn how you can identify and trade these fantastic trading opportunities in 2019, 2020, and beyond with our  Wealth Building & Global Financial Reset Newsletter.  You won’t want to miss this big move, folks.  As you can see from our research, everything has been setting up for this move for many months – most traders/investors have simply not been looking for it.

Chris Vermeulen
Technical Traders Ltd.

NQ Should Reach 8031 Before Topping

We believe once this target level is reached, the US stock market will immediately begin an extended topping formation with sideways price action and increased volatility) which will culminate in our August 19, 2019 setup date for a much deeper price correction.

At this time, traders should start to prepare for this topping event and prepare for price resistance to be found as the NQ nears this 8031 level – only 60 pts away.  If you are sitting on a bunch of profitable long trades, our suggestion would be to scale back 50% to 60% of these open positions and prepare for a top setup to begin within 7 to 10 days.  The volatility we expect to see over the next 30 days will likely be 2x or 3x current levels.

Nasdaq Daily Chart

This Daily NQ chart highlights the Fib Target Resistance level and shows our proprietary Fibonacci price modeling system’s current downside price targets (7760, 7400 and 7265).  These downside price target will change as the new price peak is established near the 8031 price level.

https://www.thetechnicaltraders.com/wp-content/uploads/2019/07/chart1-10.png

Nasdaq Weekly Chart

This NQ weekly chart highlights the same suggested resistance level (the YELLOW LINE drawn near the recent highs) and highlights deeper Weekly Fibonacci downside price targets near 6950, 6000 and 5950.

Our expectations are that economic weakness and price rotation will set up and begin a downside price move on or near August 19, 2019, based on our cycle research.  We believe this move will initially target a -6 to -9% downside price move, then extend into a much deeper price decline ending near the start of 2020 or within Q1 of 2020.

https://www.thetechnicaltraders.com/wp-content/uploads/2019/07/chart2-12.png

CONCLUSION:

Our researchers believe traders should be actively scaling back existing long positions in preparation for this top setup.  Key psychological levels have already been reached and the minute the NQ breaks above 8000, the key Fibonacci target level and the key psychological level (8000) become critical elements for the market top formation.

Now is the time to plan and prepare for these incredible price swings in the markets.  The next 18-24 months are certain to present technical traders with countless opportunities for success with these bigger price moves.

Our recent calls in the markets have resulted in over 42% in total gains over the past 60 days.  Isn’t it time you learned how www.TheTechnicalTraders.com can help you find and time better trades?

Chris Vermeulen
Technical Traders Ltd.

Earnings May Surprise the Stock Market – Watch Out!

We believe US stocks, after recently breaching key psychological price levels ($300 SPY and $3000 ES) are poised to set up a sideways Pennant price pattern formation headed into a key price breakdown near the middle of August 2019.

Our cycle indicator tools and predictive modeling suggests that August 19, 2019, is the date to watch out for and after that date, we believe the US and global stock markets may begin a new downward price phase that could lead to a dramatic price decline. Read our August 19 Top warning here

This week I will share a report showing some really interesting charts rm a very different point of view that signal a larger correction is coming based on some leading sectors and proprietary analysis. You can get this report by joining my free newsletter located at the bottom of my Current Index Trade Signal Page here.

Earning Season Expectations For This Week

Early this week, July 15 through July 19, a total of 173 companies will be reporting earnings – including a number of very large firms such as Bank Of America (BAC), Alcoa (AA), US Bancorp (USB), IBM, Bank of New York Mellon Corp (BK), E-Bay (EBAY), Netflix (NFLX), Charles Schwab (SCHW), Citigroup (C), United Airlines (UAL), JP Morgan Chase & Co (JPM), Wells Fargo & Co (WFC) and others.  The mix of reporting firms this week includes financial, consumer, basic materials, healthcare, home builders and many others.

If anything has disrupted these industries over the past 3+ months it has been the shock to the markets related to the October 2018 to December 2018 US stock market price collapse and the continuing trade wars/issues with China.  It is our opinion that these trade wars and pricing disruptions have resulted in a much more difficult environment for certain US and foreign nations to achieve Q2 expectations.  Thus, we are planning for a few interesting surprises over the next 10 to 15+ days.

Next week, July 22 through July 26, a total of 659 companies will be reporting earnings. We believe the bulk of these earnings reports will provide increased US and global market price volatility and could actually present a number of surprise results (both positive and negative).

The Nasdaq website reported this article on June 17, 2019, which we found interesting.

Expectations for Q2 2019, and to be quite honest – the rest of 2019, is overall quite negative from this article.  We believe the US markets will still be the top-performing global stock market because of the strength of the US economy and dynamic foundation of growth and opportunity going forward 2 to 4+ years.  But we are very concerned that the second half of 2019 stock market correction is about to hit and shock traders with a -15% to -20% (or more) price collapse initiated by the recent psychological price levels being breached and the Q2 earnings data that could shock the global markets.

From the Nasdaq article, Zacks Sector analysis for Q2 vs. Q1 2019 shows concern in a number of sectors while Consumer Discretionary and Retail/Wholesale shows Revenues increase and Margins fall.  Overall, it is quite distressing to see these expectations when one considers the strong economic data being released recently.

https://www.thetechnicaltraders.com/wp-content/uploads/2019/07/chart1.jpg

The computer and technology sector seems uniquely poised for a very rough year based on Zachs expectations.  Overall, Q1 2019 earnings expectations were -6.7%, Q2 2019 earnings expectations are -11.5% and Q3 earnings expectations are -11.5%.  This does not look like a very positive set of data for the rest of this year and we believe this is where the real risk of a US stock market price collapse resides.

https://www.thetechnicaltraders.com/wp-content/uploads/2019/07/chart2.jpg

Our Index Prediction Looking Forward

Months ago, we warned that a July 2019 market top is setting up and that we believed the US stock market would rotate much lower after a peak in July setup.  About 45 days ago, we adjusted our expectations to suggest that this top would likely form in August or early September based on our predictive modeling system output and our cycle tools.  We’ve honed the date down to August 19, 2019 (+/- 5 days) as the date that we believe the US stock market will TOP and/or initiate a new downside price move from this date.

You can see from the chart, below, that we believe the current price top may actually be near the highest point reached over the next 30+ days.  We believe earnings data will change the dynamics of price activity and increase volatility over the next 2 to 3 weeks.  Setting up a sideways Pennant price formation as the global markets and investors digest this new economic data.  Ultimately, a price breakdown is likely (a price revaluation event) that will allow for continued upside price growth in the future.

https://www.thetechnicaltraders.com/wp-content/uploads/2019/07/chart3-8.png

This Daily DJI chart highlights our expectations and highlights our Fibonacci Price Amplitude Arcs that suggest the true price top formation will happen sometime near August 19, 2019.  We believe this date is critical and that price could begin a very quick and dramatic downside price move near this date based on the data we are expecting to see from Q2 earnings.

https://www.thetechnicaltraders.com/wp-content/uploads/2019/07/chart4-1.png

In previous articles, we’ve suggested a simple trade setup technique we use to identify entry and exit points – the 100% Fibonacci Extension Move.

Earnings and Prediction Conclusion:

We urge traders to plan and prepare for this potential setup by reducing risk in long positions and preparing for a potential downside price move that could be related to global market concerns, Q2 earnings data and continued global trade/economic issues.

Overall, once this price revaluation event is completed, much like the event in Oct~Dec 2018 and the event in May 2019, the US stock market will very likely resume the upward price bias/trend and continue to attempt to establish new all-time price highs into 2020 and beyond.

Price rotations, like the one we are suggesting, may happen after August 19, 2019, are very healthy for the markets.  These types of moves allow price to establish support and resistance levels, revalue assets, shake out certain biases and provide for future price moves/trends.

Be prepared.  The data may result in a very big increase in volatility over the next 10~15+ days and this could result in a very dramatic price correction setting up as we’ve suggested.  Learn how our research team can help you stay ahead of these bigger market moves and find incredible trading opportunities as these big moves take place.

Chris Vermeulen
Technical Traders Ltd.

Earnings May Surprise the Stock Market – Watch Out!

We believe US stocks, after recently breaching key psychological price levels ($300 SPY and $3000 ES) are poised to set up a sideways Pennant price pattern formation headed into a key price breakdown near the middle of August 2019.

Our cycle indicator tools and predictive modeling suggests that August 19, 2019, is the date to watch out for and after that date, we believe the US and global stock markets may begin a new downward price phase that could lead to a dramatic price decline. Read our August 19 Top warning here

This week I will share a report showing some really interesting charts rm a very different point of view that signal a larger correction is coming based on some leading sectors and proprietary analysis. You can get this report by joining my free newsletter located at the bottom of myCurrent Index Trade Signal Page here.

EARNING SEASON EXPECTATIONS FOR THIS WEEK

Early this week, July 15 through July 19, a total of 173 companies will be reporting earnings – including a number of very large firms such as Bank Of America (BAC), Alcoa (AA), US Bancorp (USB), IBM, Bank of New York Mellon Corp (BK), E-Bay (EBAY), Netflix (NFLX), Charles Schwab (SCHW), Citigroup (C), United Airlines (UAL), JP Morgan Chase & Co (JPM), Wells Fargo & Co (WFC) and others.  The mix of reporting firms this week includes financial, consumer, basic materials, healthcare, home builders and many others.

If anything has disrupted these industries over the past 3+ months it has been the shock to the markets related to the October 2018 to December 2018 US stock market price collapse and the continuing trade wars/issues with China.  It is our opinion that these trade wars and pricing disruptions have resulted in a much more difficult environment for certain US and foreign nations to achieve Q2 expectations.  Thus, we are planning for a few interesting surprises over the next 10 to 15+ days.

Next week, July 22 through July 26, a total of 659 companies will be reporting earnings. We believe the bulk of these earnings reports will provide increased US and global market price volatility and could actually present a number of surprise results (both positive and negative).

The Nasdaq website reported this article on June 17, 2019, which we found interesting.

Expectations for Q2 2019, and to be quite honest – the rest of 2019, is overall quite negative from this article.  We believe the US markets will still be the top-performing global stock market because of the strength of the US economy and dynamic foundation of growth and opportunity going forward 2 to 4+ years.  But we are very concerned that the second half of 2019 stock market correction is about to hit and shock traders with a -15% to -20% (or more) price collapse initiated by the recent psychological price levels being breached and the Q2 earnings data that could shock the global markets.

From the Nasdaq article, Zacks Sector analysis for Q2 vs. Q1 2019 shows concern in a number of sectors while Consumer Discretionary and Retail/Wholesale shows Revenues increase and Margins fall.  Overall, it is quite distressing to see these expectations when one considers the strong economic data being released recently.

The computer and technology sector seems uniquely poised for a very rough year based on Zachs expectations.  Overall, Q1 2019 earnings expectations were -6.7%, Q2 2019 earnings expectations are -11.5% and Q3 earnings expectations are -11.5%.  This does not look like a very positive set of data for the rest of this year and we believe this is where the real risk of a US stock market price collapse resides.

OUR INDEX PREDICTION LOOKING FORWARD

Months ago, we warned that a July 2019 market top is setting up and that we believed the US stock market would rotate much lower after a peak in July setup.  About 45 days ago, we adjusted our expectations to suggest that this top would likely form in August or early September based on our predictive modeling system output and our cycle tools.  We’ve honed the date down to August 19, 2019 (+/- 5 days) as the date that we believe the US stock market will TOP and/or initiate a new downside price move from this date.

You can see from the chart, below, that we believe the current price top may actually be near the highest point reached over the next 30+ days.  We believe earnings data will change the dynamics of price activity and increase volatility over the next 2 to 3 weeks.  Setting up a sideways Pennant price formation as the global markets and investors digest this new economic data.  Ultimately, a price breakdown is likely (a price revaluation event) that will allow for continued upside price growth in the future.

This Daily DJI chart highlights our expectations and highlights our Fibonacci Price Amplitude Arcs that suggest the true price top formation will happen sometime near August 19, 2019.  We believe this date is critical and that price could begin a very quick and dramatic downside price move near this date based on the data we are expecting to see from Q2 earnings.

In previous articles, we’ve suggested a simple trade setup technique we use to identify entry and exit points – the 100% Fibonacci Extension Move.

EARNINGS AND PREDICTION CONCLUSION:

We urge traders to plan and prepare for this potential setup by reducing risk in long positions and preparing for a potential downside price move that could be related to global market concerns, Q2 earnings data and continued global trade/economic issues.

Overall, once this price revaluation event is completed, much like the event in Oct~Dec 2018 and the event in May 2019, the US stock market will very likely resume the upward price bias/trend and continue to attempt to establish new all-time price highs into 2020 and beyond.

Price rotations, like the one we are suggesting, may happen after August 19, 2019, are very healthy for the markets.  These types of moves allow price to establish support and resistance levels, revalue assets, shake out certain biases and provide for future price moves/trends.

Be prepared.  The data may result in a very big increase in volatility over the next 10~15+ days and this could result in a very dramatic price correction setting up as we’ve suggested.  Learn how our research team can help you stay ahead of these bigger market moves and find incredible trading opportunities as these big moves take place.

I can tell you that huge moves are about to start unfolding not only in real estate, but metals, stocks, and currencies. Some of these supercycles are going to last years. Brad Matheny goes into great detail with his simple to understand charts and guide about this. His financial market research is one of a kind and a real eye-opener. PDF guide: 2020 Cycles – The Greatest Opportunity Of Your Lifetime

Chris Vermeulen
www.TheTechnicalTraders.com

Could Gold Launch Into A Parabolic Upside Rally?

For those of you that have been following our research and Gold calls, we’ve nailed this move and our October 2018 predictive modeling call has continued to mirror (almost exactly) the price movement in Gold over the past  10+ months.  See the chart below.

Our Adaptive Dynamic Learning (ADL) predictive modeling system suggested that Gold would rally from the $1200 level to above $1300, then stall.  It suggested that in April or May of 2019, Gold would settle back below $1300 and set up a “momentum base” before attempting an upside breakout move after forming the base.  Our research team identified April 21~24 as the likely “price low” for the “momentum base” using our advanced price cycle and other research tools.

You can see from the chart, above, that our upside price targets from our original research are above $1550~1600.  What if we told you we now believe the upside price targets could actually be above $1700 and more like $1750 to $1800 on a parabolic upside price rally initiating after price breaks critical resistance levels?

Take a look at this simple Gold/Silver/USDollar index chart.  The purpose of this chart is to relate the price of Gold to the price of Silver in US Dollar price levels.  It highlights that Silver is still very undervalued in comparison to Gold and that any attempt to restore a price balance between Silver and Gold would likely result in either two outcomes : A. the price of Gold falls, or B. the price of Silver rallies faster than Gold rallies whereas this ratio will attempt to balance out (as we see back in 2013/2014).

Our Price Amplitude Arcs are a means of measuring price cycles, price waves and allow us to seek out critical price inflection points.  As you can see, where multiple arcs align and are breached by price, we typically see some type of increased price volatility and trending.  Currently, two separate arcs are setting up to be breached and we believe this is important because of how it aligns with our October 2018 research post.

What would cause Gold to rally above $1600 at this time?  Why would this become a period where renewed interest in precious metals could drive such a big move?  We believe a number of global economic factors will become more evident over the next 30 to 60+ days and that these critical Price Amplitude Arcs are suggesting price is set up to rally from these levels.  We believe the move higher will include both Gold and Silver and that Silver may rally stronger than Gold which would cause this Gold/Silver ratio chart price level to move higher – towards our objective line (MAGENTA).

We believe a key date for all traders/investors to be aware of is August 19, 2019 (+/- 5 days).  We believe this will be the date range that the market will break out of existing ranges and when fear and greed will likely solidify in the precious metals markets.  We have about 35 days to go before this date and we believe Gold will continue to trade below the “Breakout Resistance” until renewed fear and greed become more evident in the global markets.

Our Current Market Top Analysis and Charts – Click Here

This means the US Dollar will likely continue to rally, or at least stay above $96, for the next 25+ days and that upside US Dollar price activity will partially mute the upside price potential in precious metals.  Overall, the upside price momentum in metals will push metals prices higher while the US Dollar continues to strengthen moderately.  Once the US Dollar breaks lower, metals will skyrocket higher (breaking past the Breakout Resistance level) and begin the upside parabolic move.

Any opportunity you find where Gold is trading below $1400 is an excellent opportunity to prepare for this move.  Silver continues to trade below $15.50 and continues to be an incredible opportunity for traders who understand the ratio levels of precious metals.  Don’t miss this move.  It is just a matter of time (30+ days) now.

Be prepared for these incredible price swings before they happen and learn how you can identify and trade these fantastic trading opportunities in 2019, 2020, and beyond with our  Wealth Building & Global Financial Reset Newsletter.  You won’t want to miss this big move, folks.  As you can see from our research, everything has been setting up for this move for many months – most traders/investors have simply not been looking for it.

Chris Vermeulen 
www.TheTechnicalTraders.com

Major Index Top In 3 To 5 Weeks?

Our researchers rely on a number of proprietary tools and cycle forecasting technology.  Additionally, we use custom index charts to help measure price cycles, trends, support & resistance and many other aspects of the markets.  Recently, we posted an article relating to the US Dollar and foreign currencies using custom index techniques.  In the past, we’ve highlighted our Custom Price Cycle index that we use to gauge market sentiment, topping and bottoming setups.  All of these tools are essential for our team of researchers while they attempt to identify trade setups and larger market events.

Currently, we are highlighting a number of our custom index chart that suggest a market top may only be 3 to 5 weeks away and the setup of this market top may surprise many traders. We posted a good forecast chart here also.

First, we’ll highlight our Smart Money Custom Index chart on a Monthly charting basis.  As you can see since the ultimate price bottom in 2009, and using the price range from 2015 to 2016 (the rotation prior to the 2016 Presidential Elections) as the basis for the forward envelope, our Smart Money index shows the markets have rallied to levels just above the envelope in January 2018, then rotated lower to levels near the lower envelope levels in December 2018.  This extended price rotation suggests the entire year of 2018 prompted a massive price rotation event that likely resulted in a price revaluation cycle.

Our researchers believe the strength of the US Dollar will continue to drive foreign investments into the US stock market and prompt a rally to levels near the middle of this price envelope before stalling and topping in August or September of 2019.  This top formation should result in a price decline in the US stock market of at least 16% with a maximum decline level of somewhere between 24% to 28% overall.  We’ll get into more detail about that later in this article.

We want our readers to understand this Custom Price Cycle chart highlights the level at which the price bottom will likely form, near the lower level of the current price envelope, and suggests the current price rally will likely attempt to breach key psychological price levels ($300: SPY, $3000: ES, $30k: INDU) before this new price top completes.

After these new price highs are reached above the key psychological price levels, we believe the new price top will immediately begin to form with a short period of sideways price action, then a price decline back below these psychological levels and likely initiating a downward price decline of at least 11 to 13%.  It is our opinion that this downward price decline in the US stock market will align with increased global market weakness and currency devaluations that are likely to be much greater in scale and scope than the US stock market price decline.

We believe the strength in the US Dollar may be a catalyst for the future global market price declines and may also play out in future activities in precious metals and commodities.

The strength of the US Dollar, while foreign markets are contracting, would present a very ominous event as debt, credit and future operational standards of many foreign corporations, nations, governments, and consumers could come under severe pressures.

This Custom Price Cycle chart, below, highlights the current price setup of the US stock market in relation to previous high and low points.  The closer we come to the upper price channel, the more likely we are to see price setup and seek out a price top formation.  Although, history has shown that price can move up to these upper levels and continue to trend in an upward price channel for many weeks and months.  So, at some point in the future, we would expect to see this Custom Price Cycle chart revert back to 2017 type price activity where price continually attempts to stay near the upper price channel levels with very mild price rotations.

Currently, though, we believe the US stock market is only 3 to 5 weeks away from a major price topping formation and that the downside price move will likely result in a, roughly, -16% to -25% downside price rotation before the end of 2019.  We believe US earnings will push this Custom Price Cycle chart to levels near or above the upper price channel level and that will drive the US Dollar higher as well as a shift in capital deployment prior to the end of September.  The shift will be away from technology and mid-caps and into the safety of cash, metals and large-cap equities.

This shift in capital investments will likely transpire over many weeks before a serious price breakdown begins.  In other words, we expect a top formation to setup somewhere between August 15 and September 16.  This top formation will likely result in 3~6 weeks of sideways downward pricing pressure before a larger price breakdown happens.  We believe the larger price breakdown will coincide with some external economic event and result in a migration of capital away from risk and into cash/metals/safety.  Right now, our estimate is that this external economic event may be a currency devaluation event (Asian currencies breaking down and putting pressure throughout Europe and the rest of the developing world).

We believe the Asian currencies are particularly at risk for this event and that European and development market currencies will likely collapse as a result of the Asian/European currency price declines.

The US technology sector could be uniquely vulnerable should this event unfold as we suspect.  Foreign markets and investor are heavily invested in the US technology sector.  Many of these investors have moved their capital into the US Technology sector to avoid risks related to their home country’s currencies and to take advantage of the US Dollar strength.  A decline in the US stock market, of any level greater than 10%, could send a shock-wave through the global markets and cause investors to shift away from risk and into safety.

Expect to see the volatility index to start rising and for the price of options to jump as well. I posted this VIX chart and cycle analysis a couple of days ago and its good for another few weeks in terms of its direction.

IN CONCLUSION:

Our researchers believe we are only a few weeks away from this event and those Q2 US earnings will push the US stock market above these psychological price levels.  It is this event, the push above the key psychological price levels ($ 300: SPY, $ 3000: ES, $ 30k: INDU) that will likely trigger the topping event and set off a chain reaction event that we have described.

Pay very close attention to how the foreign currency market reacts over this time-span and pay very close attention to Gold/Silver and the US Dollar.  We believe this topping price formation is going to unfold just as we are suggesting and we believe this will be an incredible opportunity for skilled technical traders.

Chris Vermeulen 
www.TheTechnicalTraders.com

Predictive Modeling Suggest Oil Headed Much Lower

Our Adaptive Dynamic Learning (ADL) predictive price modeling system is suggesting Crude Oil will likely continue to find resistance near $64 as a price ceiling and trend lower over the next 3 to 5 months – eventually breaking below the $40 price level near the end of 2019 or in early 2020.

Our research team believes this move could very well be contingent on a continued decline in global economic activity as well as our research suggesting that global currencies could be setting up for a breakdown event.

Please read the following research posts for more information:

Report #1: PART III – DEBT CRISIS TO BE REBORN IN 2020

Report #2: KING DOLLAR RIDES HIGHER CREATING PRESSURES ON FOREIGN ECONOMIES

Report #3: FEAR DRIVES MARKET EXPECTATIONS

We believe the breakdown in support for Crude Oil will coincide with a general perception of global economic weakness, foreign Central Bank posturing and the possibility that foreign currency weakness may push global demand for Oil much lower than current expectations.

The volatility increased suggested near the right side of this chart, in late 2019 and early 2020, are indicative of oil prices reaching a critical support level while attempting to re-balance supply/demand-side economic factors against historic price lows.  This will likely become a period where global oil traders feel the need to try to push oil prices higher while supply/demand factors settle to establish a basis price level for future price trends.

IN CONCLUSION:

If our ADL predictive modeling is correct, we will see rotation between $47 and $64 over the next 3+ months before a breakdown in price hits in November 2019.  This will be followed by two fairly narrow price range months (December 2019 and January 2020) where oil prices will tighten near $45 to $50.  After that tightening, we believe an extremely volatile price move will happen in February through April 2020 that could see oil prices trade as low as $22 and as high as $51 over a two to three-month span.

As we’ve continued to state, 2019 and 2020 are going to include incredible opportunities for skilled technical traders and investors.  Think about how a more like this in Oil and the global markets will reflect into the precious metals markets and the US Dollar?

Be prepared for these incredible price swings before they happen and learn how you can identify and trade these fantastic trading opportunities in 2019, 2020, and beyond with our  Wealth Building & Global Financial Reset Newsletter.  You won’t want to miss this big move, folks.  As you can see from our research, everything has been setting up for this move for many months – most traders/investors have simply not been looking for it.

Chris Vermeulen 
www.TheTechnicalTraders.com

US Dollar Strength Will Drive Markets Higher

Many traders/investors fail to understand the capacity of the US Dollar to wreak havoc on foreign markets as well as to act as a support level for US equities and US investments.

The support level near $96 is currently acting as a solid price floor.  Our researchers believe an attempt to breach the $99 level will happen soon and this continued strength will put further pressures on foreign currencies, commodities, metals and trade issues.

These shifting dynamics of the currency markets are presenting very clear evidence that investors believe stronger, more mature economies are going to continue to perform over the future months that weaker, more at-risk economies.  The Japanese Yen, Canadian Dollar, Swiss Franc, and US Dollar are all performing quite well in this Year-To-Date comparison graph (below).  The New Zealand Dollar, Euro, British Pound, and Australian Dollar are all dramatically weaker.

Our research team put this comparison chart together to further illustrate the weakness of Asian currencies in relation to the relative strength of the US and major global currencies.  This chart attempt to compare currency strength by grouping relative currency pairs and comparing them as an Asian Currency Group vs a Global Major Currency Group.  As price advances, the Asian Currency Group is relatively stronger overall.  As price declines, the Asian Currency Group is weakening and the Global Major Currency Group is strengthening.

Currently, this chart shows the fragility of the Asian Currency Group.  Any break of the lower price channel level and we enter a new downside price trend that may attempt to establish a much lower price support channel for Asian Currencies, Asian Stock Markets, and the overall global markets.

Our researchers believe the continued strength of the US Dollar and the US stock market are pushing historical normal price ranges beyond expected boundaries.  As gold increases because of fear and greed, countries with larger gold reserves can attempt to offset certain losses from currency and economic weakness.  Yet companies and governments that attempted to leverage the “Dollar Carry Trade” environment from years ago may find themselves in very dangerous territory as Asian currencies continue to weaken.

A stronger US Dollar will attempt to mute the upside price activity of Gold and Silver while pushing these currencies into deeper and deeper valuation declines.  See our recent charts and short term dollar/gold forecast here. A continued shifting of capital away from “at-risk” economies/nations could push these currencies into a death spiral type of free-fall over time.

We believe the US Dollar will continue to move moderately higher over the next 4+ weeks and likely attempt to move towards the $99 price level.  This move will somewhat mute the advance of Gold and Silver, yet we believe the weakness that is likely to unfold in the foreign currency markets will prompt renewed fear and greed – pushing Gold prices much higher – even as the US Dollar continues to strengthen.

Once the XAUUSD level breaks the $1440 level – it should rally up to the $1615 to $1625 level very quickly.  This would likely be the breaking point for the Asian currencies as well.  A move like that would likely push these Asian currencies below historical price envelopes and create a panic-type of a capital shift away from risk.

Our research team believes this move will likely happen sometime between Mid-August and early September 2019.  This means we are only about 35 to 45 days away from an incredibly volatile price swing in the global markets.  This is something that most traders/investors have failed to even begin to comprehend or consider.

What would happen if the Asian capital markets and currencies collapsed on broad weakness and a major credit/debt crisis event?  An event where currencies devalue to a level that suggests forward operations are severely threatened, the rising price of Gold is not offsetting losses and commodity prices collapse pushing even further pressures on commodity/currency backed loans/debt?

Be prepared for these incredible price swings before they happen and learn how you can identify and trade these fantastic trading opportunities in 2019, 2020, and beyond with our  Wealth Building & Global Financial Reset Newsletter.  You won’t want to miss this big move, folks.  As you can see from our research, everything has been setting up for this move for many months – most traders/investors have simply not been looking for it.

Chris Vermeulen 
www.TheTechnicalTraders.com

Stock Market Cycle Top And Fearless Vix Signal Turning Point

Before we get into the details here I would like to touch on two myths that you as a trader need to know in terms of average profit per trade and the number of trades needed to be highly profitable. It’s not what you may think.

Myth #1: You Must Always Be In A Trade and Trading
You don’t need to trade every week, or need to always be in a position. This is a huge misconception and something that most traders struggle with grasping. The reality is, the fewer the trades you make less likely you are to lose money. For example, over the past 17 months, I have placed 53 trades which works out to only 3 trades a month, not many. With those 53 trades, our entire portfolio is up 74.9%. Ya, a whopping 75% with only a few simple trades a month and if you calculate what the average percent return is then you get a taste of trading reality, which brings us to the topic 2.

Myth #2: You Need 8%-25%+ Profit Per Trade to Make Big Profits
Average percent return per trade is another thing most traders have completely backward. If you take 74.9% divided by 53 trades you get 1.41% average return per trade. WOW, that’s low, right? Ya, it seems low, but that’s the reality of trading. The markets wiggle up and down 1-5% regularly and you cant perfectly nail every top or bottom, and sometimes a nice trend trade is completely wiped out in 1-3 days from a flash crash type of sell-off and we have seen a few of those in the past year. What you are left with is the safe middle 1%-3% each trade,  and these trades are the norm. But with that said we still have some 5-10% losing trades, and some 20-45% winners pickled in there which is always exciting.

My point on these two topics is for everyone to stop thinking you always need to be trading and think every trade should make 10-20% profit or it’s not worth your time and money.

I get emails all the time from traders who demand 5+ trades a week, expect big gains on every trade, and they usually have a story to share about how they recently lost a boatload money trading some 3X ETF with nearly their entire portfolio in one position and they need my help for some big trades to make it all back.

Yes, I can help, Yes it’s possible we get a couple of big trades that could do this, it happens, but we don’t know exactly when or which trade it will be. You must put in our time, trade cautiously and the big wins will happen over time.

Traders like this most definitely need some help because if they don’t start trading properly soon enough they will take a big loss, give back months/years of hard work, or blow up their account altogether. Trust me I have been there done that three times when starting out. Losing everything three times is a very sobering experience but sometimes it is the only way to learn if you don’t find the right mentor or trading newsletter to follow. Focus on building your account and wealth over time, not in a few fast-moving stocks/ETF trades.

SP500 DAILY CHART & CYCLE ANALYSIS

This chart is a little cluttered but if you look at the bottom of the chart where my cycle tool is located you will see how different cycles have different strengths and form short term tops and bottoms.

They key focus should be on the three larger RED shaded areas, and the one large GREEN shaded area. Those are what I call Cycle Clusters. When all three cycles are in the overbought or oversold zone we should expect weakness for 3-6 days.

The light blue cycle when trading in the overbought or oversold zone can be used for re-entry or adding to positions in favor of the overall trend (up or down).

By having this technical trading tool we are able to scale in and out of the market for increased profits while reducing our portfolio risk.
This cycle tool is something subscribers to my Wealth Building Newsletter will have access to in the very near future including my complete entry, targets, and stop alerts. By following all the key markets we will have a steady stream of trades each month for increased profits.

DAILY VIX CHART AT SUPPORT & CYCLE CLUSTER

I decided to pull some VIX analysis into this research simply because the VIX recently tagged a critical support level as shown on the chart below, along with a cycle low cluster. Both of these things occurring could mean stocks are set up for a deeper than normal correction in the very near future.

The VIX at times can act as a crystal ball during times of extreme fear or complacency. Currently, complacency is the signal with traders and investors having no fear of falling prices.

The VIX is a contrarian indicator with the old saying “When the VIX is high its time to buy, with the VIX is low its time to go”.

Based on the options market for VIX puts and calls traders are expecting the VIX rise over than a couple of days and even a month from now.

30 MINUTE CHART & CYCLE PREDICTION

If we take the analysis one step further, we can zero in on the 30-minute regular trading hours only chart (9:30 am ET – 4 pm ET) with our blended cycles price bias for a better feeling of where the price is wanting to go over the next 3-6 days.

Based on the SP500 index cycles, coupled with the VIX cycles and test of support the intraday analysis looking forward 3 days looks to be in line with the other trading tools.

IN CONCLUSION:

In short, expect stocks to trade sideways or lower this week and for the VIX to work is way higher.

I can tell you that huge moves are about to start unfolding not only in metals, or stocks but globally and some of these super cycles are going to last years. A gentleman by the name of Brad Matheny goes into great detail with his simple to understand charts and guide about this. His financial market research is one of a kind and a real eye-opener. 2020 Cycles – The Greatest Opportunity Of Your Lifetime

Chris Vermeulen 
www.TheTechnicalTraders.com

Debt Crisis To Be Reborn In 2020 – PART III

It does not matter if you are invested in anything at this point – you need to read this last portion of our research because you need to plan for and prepare for this next event.

On March 31, 2019, we published this research post regarding our cycle analysis predictions and the belief that a major price cycle top would likely form in July 2019.

On June 11, 2019, we updated our research and published this post regarding our belief that current cycle forecasting suggested the top in the market would now be set up for some time in late August or early September 2019.

This SPY chart highlights what our research team believes to be the current outcome of the US stock market given our predictive modeling systems, price rotation modeling and other proprietary utilities we use to conduct our research.

We believe the current upside price rally is a push to establish price levels above $300 on this SPY chart, just as we suggested in the June 11 article, and that this attempt a major psychological price level ($300) will likely become an exhaustion rally point where price immediately rotates lower – attempting to find support.  We believe temporary price support will be found near $287 to $298 where the price will briefly stall and move slightly higher into August 2019.

It is at this point that our cycle research becomes critical for technical traders.  This price rotation will set up a final leg to a larger Pennant/Flag formation with the potential for that last upside price leg, in August, to become a “washout high” price move.  This happens when price fakes a price move/trend, causing investors to believe a breakout or breakdown more is taking place and JUMP IN, then price immediately reverses direction.

It is extremely important for all technical traders to understand our original price predictions, from March 31, 2019, and our current price predictions, from June 11, 2019, align with this current article in certain aspects.  Price is going to target the psychological $300 level in the SPY.  Price is going to continue forming into a Pennant/Flag formation.  And the price will likely peak in late August or early September – just as we have predicted.

https://www.thetechnicaltraders.com/wp-content/uploads/2019/07/SPY_W_Breakdown_F.png

We expect this price rotation, or price revaluation event, to attempt to find support as we have highlighted on this chart.  If these levels fail to hold as price support, then we could be in for a much deeper price revaluation event.  We don’t believe that will be the case as the US elections and other factors should prevent the price from falling too far below the $245 level.

Expect some increased price volatility over the next 30+ days.  Expect Gold and Silver to properly reflect the FEAR and GREED that is prevalent within the global markets.  Expect many traders will be caught off guard when this $300 level on the SPY is breached as many will be thinking “we are off to the races – time to pile into the LONG SIDE”.  We believe this is the wrong action to take.

I can tell you that huge moves are about to start unfolding not only in metals, or stocks but globally and some of these supercycles are going to last years. A gentleman by the name of Brad Matheny goes into great detail with his simple to understand charts and guide about this. His financial market research is one of a kind and a real eye-opener.

As a technical analysis and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for both short-term swing trading and long-term investment capital. The opportunities are massive/life-changing if handled properly.

Chris Vermeulen 
www.TheTechnicalTraders.com

Is The Debt Crisis About To Be Reborn In 2020? – Part II

The Transportation Index has not recovered to levels from the September 2018 peak.  This lower price rotation in the Transportation Index suggests the global economy is not expecting growth in the near future.

Other than Precious Metals, the Commodities sector has rebounded off of recent lows but has yet to see any real price advancement – suggesting that demand for raw commodities is rather weak.

The Real Estate sector in the US is starting to falter near a current high price level.  We are seeing price decreases hit the markets as sellers are desperate to attract buyers.  This could be a warning that a price revaluation event is about to unfold in the US.

Super-Cycles suggest a moderately sized price rotation between now and early 2020 (likely greater than 20% in size).  This rotation, should it happen, will become a price revaluation event that could attempt to “shake loose” some of the sector pricing and forward expectations we’ve mentioned (above).

Our bigger concern is the localized state and federal pension and retirement issues that continue to respond with higher levels of financial commitments and greater levels of annual budgets as related to ongoing capacity and operational activities in the US.

If an unwinding event was to unfold in or near 2020, it is our belief that a pricing revaluation event related to any of the core economic factors above (particularly with Real Estate, Economic Cycles, the US Presidential Elections, and a soft/weakening US economy) could result in a much larger price revaluation event taking place.  This would create extended pressures on local State and Federal expenses and highlight debt issues that can often be hidden behind “creative accounting” tricks.

State and Local Government Debt Securities and Loan Liability levels have stayed elevated, yet somewhat flat over the past 10+ years.  It is very likely that these debt levels have been contained because of the US easy money policies of the past 10+ years.  When the US Dollar is cheap and easy to repay, these debt levels don’t look so difficult.