Silver Weekly Price Forecast – Silver Markets Reach Towards Highs

Silver markets initially pulled back during the week to show signs of weakness, but then rallied rather significantly to break above the $18 level on Friday. By doing so, this is a very bullish sign and it is likely that we will see a lot of resistance near the $19 level. In fact, we have seen the $19 level offer selling pressure than once, so to simply blow through there would be exceedingly difficult to happen. I believe that a pullback is a bit overdue, although one would have a hard time arguing with the bullishness of at least the precious metals part of silver.

SILVER Video 01.06.20

I do believe that the $17 level should be rather supportive, and most certainly the $16 level as well. The biggest problem with move as of late is that silver depends on a lot of industrial man, something that does not seem to be highly likely at this point. Ultimately, this is a market that I think we are going to see a lot of volatility in, and clearly buying all the way up here is a bit difficult to do as it is stretched. That being said, the market will be difficult to short, so I think more than anything else you probably have an opportunity to buy silver at cheaper levels, and that is something that longer-term investors will be looking at with great interest. Do not use a lot of leverage in this market, that would be a great way to lose money at this point.

For a look at all of today’s economic events, check out our economic calendar.

S&P 500 Weekly Price Forecast – Stock Markets Reach Towards 3000

The S&P 500 has rallied significantly during the week, breaking well above the 3000 level but you can see it did give back quite a bit of the gains as Thursday and Friday were a bit rough. At this point in time, it is likely that the market would continue to see a lot of noise so keep in mind that the market is likely to cause a lot of headaches more than anything else.

S&P 500 Video 01.06.20

I do think that the market is overvalued and quite frankly there is absolutely no reason for the stock market to be this high. However, most of what we are seeing is due to liquidity flows, meaning that the Federal Reserve pumping the markets full of cheap money is the most important thing to pay attention to. This has nothing to do with the economy, nor does it have anything to do with earnings.

Those things went by the wayside in 2008 as the Federal Reserve has continued to flood the markets with liquidity. That being said, there are a lot of concerns about the US/China trade war heating back up, so that might be the main problem with trying to short this market. That being said though, I think at the very least we need to pullback in order to build up the necessary momentum to continue going higher. Ultimately, we are at a major decision point so if we break above the top of the weekly candlestick, it is likely that we could go all the way back to the all-time highs.

For a look at all of today’s economic events, check out our economic calendar.

Crude Oil Weekly Price Forecast – Crude Oil Continue to Reach Towards Gap

WTI Crude Oil

The West Texas Intermediate Crude Oil market has gone back and forth during the week, as we continue to see a lot of noise in general. That being said, the market is likely to continue seeing resistance just above as it is the beginning of the massive gap that continues to be one of the biggest technical areas on the chart. I think that we probably will eventually break out to the upside and then go looking towards the $41 level above which coincides with the 200 day EMA. I do not expect break above the $41 level.

WTI Oil Video 01.06.20


Brent markets of course went back and forth during the week, as we continue to see a lot of noise when it comes to the energy market. Quite frankly, this should not be a huge surprise considering that the market has to deal with when it comes to demand and of course questions as to whether or not some of the members of OPEC plus will continue to keep the production cuts and play. At this point, I think that we probably go looking towards the $40 level, and then possibly even break above there to go looking towards the $45 level.

All things being equal, we could pull back to the $30 initially, so with that it is possible that the buyers will come in based upon value at that point. If we did break down below the $30 level, then it means we get another leg lower. All things being equal, the market is likely to be positive though, it just simply because we need to fill that gap.

For a look at all of today’s economic events, check out our economic calendar.

Natural Gas Weekly Price Forecast – Natural Gas Markets Continue Sideways Disruption

NATGAS Video 01.06.20

Natural gas markets initially tried to rally during the trading week but found the $2.00 level to be far too much in the way of resistance. That is an area that I think continues to be remarkably interesting to traders, but ultimately this is a market that looks as if it is trying to find some type of bottoming pattern. At this point, I think that we are likely to see a move down towards the $1.60 level before the buyers start to return.

It is difficult to deal with this type of action from a longer-term standpoint, simply because there is so much in the way of choppy behavior. Having said that, there is a lot of support underneath at the $1.50 level from a longer-term perspective as well, so I think we are in the process of at least trying to form some type of bottom, but the question is whether or not it can hold. I do not anticipate much in the way of momentum either way, so I would probably lead you towards the daily charts more than anything else.

If we break above the $2.13 level, which is the 50 week EMA, then obviously that would be a major shift in attitude as it is a large technical barrier. Breaking above there allows the market to go looking towards the $2.50 level. We need to see economies opening up a driving up demand in order to drive natural gas price higher. So far, it has been lackluster, but we should get plenty of bankruptcies to help as well.

For a look at all of today’s economic events, check out our economic calendar.

Gold Weekly Price Forecast – Gold Markets Form Support of Looking Candle

Gold markets initially fell during the week but found enough support at the $1700 level to turn around and form a bit of a hammer. This has been an interesting couple of weeks for gold, as it simply consolidates in general. I think at this point it is likely that we will continue to see this market show a lot of noise, and therefore it is going to be difficult to simply jump in with a huge position. Having said that, you clearly cannot short gold at this point, there is a lot of the world out there looking to buy gold “on the cheap.”

Gold Price Predictions Video 01.06.20

At this point in time, the $1700 level looks to be crucial, just as the $1760 level is. If we can break above there, then it is likely would go looking towards the $1800 level. Breaking above there then opens up the possibility of a move to $2000, something that I do feel it is only a matter of time before we reach. After all, there is plenty of central bank printing, and it is likely that the gold markets respond due to the fact that fiat currencies are trying to be devalued. If that is going to be the case, then people will run towards precious metals.

Beyond all of that, there are a multitude of negative headlines out there that could cause issues, and that of course drive money into gold for safety. With this in mind, I fully anticipate that gold will continue to be one of the better performers for the rest of the year, therefore I like buying breakouts.

For a look at all of today’s economic events, check out our economic calendar.

Metals Nearing Critical Momentum for New Parabolic Rally

While the US stock market has rallied over the past 5+ weeks, Gold has stalled near $1730 to $1740.  We issued a research post suggesting the GREEN Fibonacci Price Amplitude Arc was acting as major resistance and once that level is breached, we expect a big upside move in Gold.  Currently, Gold has reached just above the Green Price Amplitude Arc and this week may be a critical moment for both Gold and Silver in terms of a momentum base.


Gold has continued to move high in a series of waves – moving higher, then stalling/basing, then attempting another move higher.  This recent base near $1740, after the deeper price rotation in February/March, confirms our 2018/2019 predictive modeling research suggesting that $1750 would be a key level in the near future.  Part of that research suggested once $1750 is breached, then a bigger upside move would take place targeting levels above $2400 – eventually targeting $3750.

April 25, 2020: Fibonacci Price Amplitude Arcs Predict Big Gold Breakout

This consolidation after the COVID-19 event near $1750 is a very real confirmation for our researchers that the upside breakout move is about to happen.  How soon?  It could begin to break out next week of the following week?  How high could it go?  Our upside target is $2000 to $2100 initially – but Gold could rally to levels near $2400 on this next breakout move.


While Gold has been consolidating near $1740, Silver has exhibited an incredible upside price move after a very clear Flag/Pennant formation (highlighted in YELLOW on the chart below).  The current upside price rally in Silver appears as though it may breach the MAGENTA downward sloping trend-line and this breakout move may prompt a rally to levels near or above $21 over the next few weeks.

Eric Sprott is very excited about silver and miners. Also, he talks about the demand for physical delivery which is way out of whack and how something could finally give which would be metals go parabolic.

We’ve been suggesting that metals will transition into a moderate parabolic upside price trend as the global markets deal with concerns related to economic activity, debt, solvency, and continued operational issues.  For skilled technical traders, this setup in Metals may be a very good opportunity for skilled technical traders to establish hedging positions in ETFs or physical metals before the breakout really solidifies.

Concluding Thoughts:

Longer-term, we believe metals could continue to rally for quite a while, yet we understand skilled technical traders want to time entries to limit risks.  We believe skilled technical traders should consider hedging their portfolio with a moderate position in Metals/Miners at this time – allowing traders to trade the remaining portion of their portfolio in other sectors/stocks.

If the US/Global markets continue to struggle to move higher over the next 60 to 90+ days, metals/miners should continue to push higher – possibly entering a new parabolic upside price move.  The deep washout low in Silver was an incredible opportunity for skilled traders to jump into Silver miners and Silver ETFs at extremely low price levels.  Now, with Silver at $18.40, it’s time to start thinking about $21+ Silver and $2100+ Gold.

Please take a moment to visit to learn more about our passive long term investing signals, Also, get our swing trading signals here  I can’t say it any better than this…  I want to help you create success while helping you protect and preserve your wealth – it’s that simple.

For a look at all of today’s economic events, check out our economic calendar.

Chris Vermeulen
Chief Market Strategist
Founder of Technical Trader Ltd.


USD/JPY Weekly Price Forecast – US Dollar Stock in Tight Range Against Japanese Yen

The US dollar went back and forth during the course of the week, hanging around the ¥107 level yet again. This seems to be a bit of a magnet for price, as it is in the middle of the larger consolidation area between the ¥105 level on the bottom and the ¥109 level on the top. At this point, it looks as if the market is trying to pick the next direction, so you are better off simply waiting on some type of impulsive candlestick to get involved. Ultimately, I think that longer-term traders will probably continue to avoid this market, and quite frankly I think they probably should.

USD/JPY Video 01.06.20

When we do make that impulsive candlestick, then you can follow the market for a couple of hundred tics. Ultimately though, the market looks highly likely to see some type of decision eventually. At this point, this is a market that is probably easier to trade on short-term charts, as an investment would be a bit difficult.

Ultimately though, I do think that we will get that signal as to where we are going for the next 500 points, but right now we are not anywhere near making that decision so I would be cautious about putting too much money into this market in the meantime. If you are patient enough, you should get some type of trend to follow, but right now we clearly do not have land when it comes to these two currencies, which both are thought of as “safety currencies”, so it should not be a huge surprise.

For a look at all of today’s economic events, check out our economic calendar.

GBP/USD Weekly Price Forecast – British Pound Has Strong Week

The British pound has rallied significantly during the week, reaching towards the 1.2350 level. This is an area that shows up a lot on shorter-term charts, as both support and resistance. If we can continue to grind higher from here, and we very well could, then the 1.25 level becomes in focus. That area I think would continue to cause significant resistance, so pay attention to that level if we get there, as it will certainly be a major fight.

GBP/USD Video 01.06.20

If we were to break above the 50 week EMA, which is just above there, then the British pound could very well go to the 1.30 level. Ultimately, this is a market that I think has to deal with the Brexit headlines next week, as negotiations start back up. It already has been a lot of chirping between London and the continent, as the chief UK negotiator recently stated that the “European Union needs to come a long way to have an acceptable agreement.” If that is going to be the case, I cannot imagine that good comes out of this.

Were in a downtrend anyways, so that should only help the downward momentum. However, it looks to me like the market is likely to continue to see a lot of noise, so be cautious about your position size, and be patient. You need to see some type of exhaustive candle to start shorting. If we break above and close above the 50 week EMA on the daily chart, then it is time to start buying. I think it is that simple.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Weekly Price Forecast – British Pound Resilient Against Yen

The British pound rallied during the week, breaking above the ¥132 level in a sign of strength. However, there is a lot of noise between here and the ¥135 level, so I think it is only a matter of time before we see some type of pushback. Keep in mind that the market has faced a lot of support underneath in order to bounce yet again. However, the most recent bounce before the one we are in now is lower, so that does suggest that perhaps there is still a lot of shorting going on out there.

GBP/JPY Video 01.06.20

The market has been rather tight as of late, so at this point I think we are waiting for a large impulsive candlestick in order to take some type of trade on. At this point, I believe that simply waiting to see where the risk in the world is will tell you what this pair should do. Quite frankly, I believe that the Japanese yen is considered to be “safer” than the British pound because not only do we have global issues, but we also have to worry about the Brexit which is not going anywhere, and we do in fact have to get through a slew of headlines that could cause major issues in that scenario.

With that in mind, I think it is more than likely going to be a scenario where we get a lot of choppy volatility, but I think the road higher is going to be difficult to achieve. A break above the ¥135 level could get this market moving to the upside quite quickly though.

For a look at all of today’s economic events, check out our economic calendar.

EUR/USD Weekly Price Forecast – The Euro Explodes to The Upside

The Euro market rallied against the US dollar on the majority of the week, reaching towards the 1.1150 level before pulling back a bit early on Friday. Quite frankly, we are facing a significant amount of resistance just above and this is a completely messy chart at the moment. Yes, it is an extraordinarily strong and bullish candlestick that we have seen this recently, where the Euro exploded straight up in the air and then got slammed right back down.

EUR/USD Video 01.06.20

A lot of what we are seeing is a reaction “unified bonds” that the European Union is selling. In other words, Germany is backstopping Greece. With that, it should lead to a stronger currency, but at the end of the day the economic figures do not pan out for a stronger Euro. It is because of this that I think we will continue to see a lot of volatility, and therefore do not trust this rally quite yet. Beyond that, it is important to think of this as an indicator, showing you Euro strength or weakness in general.

I will use this chart tell me what to trade as far as direction is concerned in any EUR pair, but not necessarily this one. As I stated in my daily analysis, this sets up for a great indicator with the EUR/CAD pair, especially if crude oil continues to fall. However, I will keep you up-to-date as to what I see but right now I think we are to see a widening volatility regiment in this market, and that of course makes for nothing but headaches.

For a look at all of today’s economic events, check out our economic calendar.

AUD/USD Weekly Price Forecast – Australian Dollar Running Into 50 Week EMA

The Australian dollar has rallied significantly during the week, reaching towards the 50 week EMA which sits at the very top of the candlestick. If we pull back from here, it does make quite a bit of sense that the market could drift a few handles lower, because we are right where the massive break in support occurred. This is an area that at least from a technical analysis standpoint should be quite interesting for sellers, and therefore I think it will attract quite a bit of attention. Furthermore, with even more telling is that Donald Trump is coming with an announcement involving China heading into the weekend, and that more than likely will not do many favors for the Aussie dollar as well.

AUD/USD Video 01.06.20

That being said, if we were to break above the 0.67 level on a daily close, then I think we start to think about the market reaching towards the 0.70 level. Breaking above there would change the entire trend, something that I do not anticipate seeing. Yes, this has been an absolutely brutal bounce, but I think that in the end it is just that: a bounce. However, I am willing to follow the market and admit that I am wrong if we do break out to the upside.

Remember that the Australian dollar is overly sensitive to the Chinese situation, which of course could get overly complicated relatively soon. With that being the case, I think that the Australian dollar will probably take it on the chin. For what it is worth, the Aussie stock market looks absolutely horrible.

For a look at all of today’s economic events, check out our economic calendar.

Fibonacci Queen and Elliott Wave King Market Proclamation

For those that do not know, Carolyn Boroden (The Fibonacci Queen) has joined the analyst team at Elliottwavetrader. So, she and I are endeavoring to present our combined perspectives to outline our general expectations over the coming weeks, as we begin this series of articles.

There are times when the market provides us with clear indications. And, as proceeded through March, Carolyn and my work were focused upon the region just below 2200SPX for a potential bottoming in the S&P500. Specifically, Carolyn had key price parameters in the 2165-2193SPX region, and the bottom of my support region was pointing towards 2187SPX, with my next lower support below that in the 2160SPX region. My expectation at the time was that the market was going to hold the 2187SPX support and rally towards the 2650-2725SPX region from there.

Moreover, Carolyn identified a confluence of multiple Fibonacci time cycles that came due between 3/24-26 and calendar day projections that came due on 3/22-23.

As we now know, the bottom for the market was struck at 2191.86 on 3/23.

At the time, neither of us were certain that the bottom struck on that day would be the lasting bottom, but we both recognized there was strong potential for that to be the case. My expectation was that the market would rally from the 2200 region up towards the 2650-2725SPX region. And, once we were able to exceed that 2725SPX resistance, that opened the door to the market having struck a major bottom.

While the smaller degree structure is a bit questionable at this time, both Carolyn and I see potential for the SPX to exceed the 4000 mark. In the near term, as long as the market holds over the 2760/2788SPX support region, there is strong potential for us to continue higher towards the 3234SPX region next.

However, Carolyn’s next time cycles are due between 5/26-5/29, which suggests that we could see some form of near-term topping within the 3065-85SPX region, to be followed by a test of the cited support region noted above.

Overall, both our work suggests that the market has struck an important bottom back in March. And, as long as pullbacks continue to hold support, our combined analysis seems to be pointing towards the 4000SPX region, and potentially even higher than that in the coming years.

For a look at all of today’s economic events, check out our economic calendar.

See charts illustrating Avi’s wave counts and Carolyn’s Fibonacci targets on the S&P 500.

Avi Gilburt is a widely followed Elliott Wave analyst and founder of, a live trading room featuring his analysis on the S&P 500, precious metals, oil & USD, plus a team of analysts covering a range of other markets.


Real Estate Stats Show Big Wave Of Refinancing Is Coming

Current data released for the May Real Estate and Consumer Spending activity suggests a wave of refinancing is taking place – and not much else.  Pending home sales slipped to 69.  That level is 7.4 points below the lowest level in 2010 – at the height of the 2008-09 credit crisis that collapsed the global Real Estate values.  How big is this new low level in Pending home sales?  It’s HUGE.

It suggests the rate of sales in the US for Real Estate has collapsed beyond levels that were seen at the worst possible time in recent history (July 2010).  In fact, over the past 20 years, there has never been a time when the pending home sales index has collapsed below 74 to 75 – until today.

2008-2011 Pending Home Sales Data


The sudden collapse of Pending Home Sales as a result of the COVID-19 virus event should not have come as any surprise to skilled technical investors.  Don’t misread this data – there are still homes selling in the US market, buyers are just being far more selective and discerning in regards to their purchases and timing.

Anyone who understands Supply and Demand theory knows that when price levels are perceived to be excessive, consumers slow their purchases considerably as the supply is determined to be overvalued in price.  This slowing of purchasing results in a supply glut that will eventually push price levels lower (attempting to attract more buyers).

It is this process of shifting perceptions in the Supply and Demand relationship that is likely taking place right now in the Real Estate market.  Low rates in combination with the COVID-19 virus are not prompting more sales of Real Estate right now.  Consumers simply don’t have the confidence (perception) that future price appreciation in Real Estate will be substantially based on the current market environment.  Thus, the perception of the value of Real Estate changes from optimism to caution.

2020 Pending Home Sales Data

A large portion of the issue related to Real Estate is consumer confidence in their ability to earn real incomes and the stability of employment and opportunity related to their future.  The COVID-19 virus event has really disrupted a large portion of the US consumer market as well as the future expectations of consumers and spending habits.  This disruption is likely to take at least 12 to 24+ months to settle before any real bottom is likely to take place on a broad scale.

Real consumer spending has collapsed in April and May 2020.  Even though the US government has spent trillions attempting to support the US economy, the continued shutdown of cities and states has cut consumers’ jobs, incomes, and the need to go out and spend like normal.  Even though they may be saving some extra money throughout this time, the destruction to local and state economies/revenues is devastating.

May 2020 Real Consumer Spending Data

The one aspect of the low-interest rates that we do expect to peak soon is the refinance market.  Stronger homeowners with solid income opportunities are able to refinance at lower rates now and that activity seems to be spiking.  This is very similar to what happened in 2009-2011 where stronger consumers were able to take advantage of very low-interest rates and were able to shed the 5 to 7%+ mortgages and refinance at much lower levels.  Once these transactions peak, these homeowners will likely be settled in their homes for another 5 to 10+ years with new lower rates (unless something disrupts their financial/income situation).

May 2020 Mortgage Refinance Index

Concluding Thoughts:

Combining all of this data into a consensus analysis for technical traders, we come to the conclusion that a wave of refinancing has likely peaked and that consumers are now in the early stage of attempting to understand what the recovery will look like going forward over the next 6 to 12+ months.  Add into the mix that we have a US Presidential election taking place in 6 months and the potential policy and tax changes that could take place as a result of this election and we have a real “consumer abyss” setting up over the next 6+ months.

With the Fed doing all they can to support the markets, the COVID-19 virus still causing shutdowns and other issues and the consumer waiting for some clear skies and positive expectations, the US and global economy could be stuck in a mode of greatly decreased consumer activity over the next 6 to 12+ months – which translates into a shift in perspective related to business creation, optimism, income/earnings and much more.  A dramatic shift in consumer expectations over a longer period of time could result in far more damaging longer-term issues for assets, state and local governments and more.

Once the wave of refinancing is completed, we’ll have to see how the housing market data relates to increased consumer optimism.  At this point, we don’t believe anything is likely to change consumer attitudes until after the November 2020 elections.  Skilled technical traders should prepare for some really big price swings over the next 12+ months. This is the time for technical traders to shine with the setups and data that is being presented right now as well as in the future.

Please take a moment to visit to learn more about our passive long term investing signals, Also, get our swing trading signals here  I can’t say it any better than this…  I want to help you create success while helping you protect and preserve your wealth – it’s that simple.

For a look at all of today’s economic events, check out our economic calendar.

Chris Vermeulen
Chief Market Strategist
Founder of Technical Trader Ltd.


All Eyes on the HUI Breakout Invalidation!

The key technical development of this week in the precious metals market is HUI’s invalidation of the breakout above the 2016 highs. It will be particularly interesting to see where it closes the week, as an invalidation in weekly closing terms will be a crystal-clear bearish confirmation.

Gold miners reversed before the end of yesterday’s session, but they didn’t manage to take HUI back above the highest weekly close of 2016 – the 278.61 level. The HUI closed at 271.06.

On the daily chart, we see that a short-term breakdown is currently being confirmed.

The GDX ETF moved below the rising support line based on the previous April and May lows and it closed there for two consecutive trading days. If the GDX closes below the rising dashed line once again today, the breakdown will be confirmed.

And based on gold’s 4-hour gold chart, it could be the case that the very short-term upswing that started yesterday, is already over.

Gold approached its short-term declining resistance line, and it’s currently testing it. This line already held less than a week ago, so it favors lower prices at this time.

Of course, by the time you read this analysis, gold might already be after a breakout. In this case, we wouldn’t be surprised to see gold futures at about $1,740 or even $1,760 before the next decline takes place. Again, that is IF the breakout takes place, but the entire point of creating resistance lines for gold is to detect gold’s tops – places that are likely NOT to be broken. Or that are going to be broken, but then an invalidation will follow, leading to further declines.

The GLD ETF bounced from the rising support line yesterday, and it then moved to the above-mentioned resistance line – that’s a relatively normal course of action. Based on HUI’s invalidation of the breakout above the 2016 high, it seems that the top is already in for gold and gold stocks, and the price action yesterday and today in gold doesn’t invalidate it.

And what can one forecast for silver?

The white metal is still showing strength on a very short-term basis, which further confirms the toppy nature of the most recent price moves. Silver tends to outperform at the very end of a given upswing, so we could even see more of that phenomenon – especially if the stock market moves even higher from here.

Silver is known (at least it should be known) for its fakeouts. Silver often breaks above certain resistance levels, only to invalidate these breakouts shortly thereafter. If silver’s “breakout” is not accompanied by an analogous move in gold or miners, the odds are that it’s a fakeout. The odds increase further if this action was preceded by a rally.

Therefore, if silver moves higher from here, and even breaks to new May highs, it might not be a bullish development at all. It could be a fakeout that only takes the white metal to about $18.50 or so – the declining resistance line based on the previous highs – and then starts the next huge downleg. Please keep in mind that silver already launched one huge slide from almost $19 this year, so another big move lower from these levels could definitely take place.

All in all, it seems that we’re going to see one more sizable move lower in the precious metals market before they move much higher, and the odds are that the downswing has already begun or it’s going to start shortly.

Thank you for reading today’s free analysis. Please note that it’s just a small fraction of today’s full Gold & Silver Trading Alert. The latter includes multiple details, but most importantly, it includes the clear discussion of what will be the sign telling one that gold’s move lower is almost certainly completely over. That’s the detail, we think you might enjoy, want, and need right now.

If you’d like to read those premium details, we have good news. As soon as you sign up for our free gold newsletter, you’ll get 7 access of no-obligation trial of our premium Gold & Silver Trading Alerts. It’s really free – sign up today.

For a look at all of today’s economic events, check out our economic calendar.

Przemyslaw Radomski, CFA

Editor-in-chief, Gold & Silver Fund Manager

Sunshine Profits: Analysis. Care. Profits.

* * * * *

All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits’ associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski’s, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits’ employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.


M2 Velocity Collapses – Could A Deep Bottom In Capital Velocity Be Setting Up?

M2 Velocity is the measurement of capital circulating within the economy.  The faster capital circulates within the economy, the more that capital is being deployed within the economy to create output and opportunities for economic growth.  When M2 Velocity contracts, capital is being deployed in investments or assets that prevent that capital from further circulation within the economy – thus preventing further output and opportunity growth features.

The decline in M2 Velocity over the past 10+ years has been dramatic and consistent with the dramatic new zero US Federal Reserve interest rates initiated since just after the 2008 credit crisis market collapse.  It appears to our researchers that these extended periods of zero interest rates deflate the capability of money circulating throughout the economy and engaging in real growth opportunities for investment and capital inflation.

It also suggests that the US Federal Reserve, while attempting to support the US economy and global markets, maybe destructively engaging in policy that removes the capital function from the markets in a systematic process.  Eventually, something will break related to M2 Velocity and/or the global economy.  As more capital pours into less liquid assets and/or broader investment funds and Bonds, this process ties capital up into assets that take investment away from Main Street and the lower/middle class.  There is less capital available to support the ground level economy as more and more capital ends up buried in longer-term investment assets.



We believe the collapse of the M2 Velocity rate is similar to a slow decline of economic capacity and output over a longer period of time.  We believe this process will likely end in a series of defaults and bankruptcies as a result of capital being stored away into longer-term assets and investments (pensions, investment funds, and other types of longer-term assets).  As this capital is taken away from the core engine of economic growth (main street and startups), the process of slowly starving the economy begins.

We believe we’ve already entered a period of decline that has lasted at least 15+ years and the “blowout process” that ends this decline will be somewhat cataclysmic.  One way or another, the function of capital must return to levels of activity that supports a ground-level engagement of economic growth and opportunity.  A healthy balance of capital available to all levels of society and deployed in means to support growth and opportunity is essential for the proper health and future advancement of global economies.

It appears that after 2008-09, the global economy disconnected from reality as investors began relying on institutional level investments and speculation in large scale assets instead of ground-level investments and core economic function.  This translates into a very euphoric mode for stocks and commodities where capital chases capital around the planet seeking out undervalued and opportunistic investments…  until…

Pay attention to what happens over the next 4 to 5+ years related to the COVID-19 virus event.  We believe this virus event could be a “monkey wrench” in the capabilities and functions of the global economy over the next 5+ years. Pay attention to what is really happening as capital plays the “dog chasing its tail” routine and the central banks attempt to stimulate economic activity by printing more and more money.  If you understand what we are trying to suggest in this article – printing more and more money at this stage of the game is like saying “diving our of the 20th-floor window is not enough – let’s go up to the 50th floor and give it a try”.

Hang tight, there are going to be some very interesting and big price swings over the next 4+ years in the US and global markets.  Skilled technical traders should prepare for the opportunity of a lifetime if they understand what to watch for and how to protect assets.

Please take a moment to visit to learn more.  I can’t say it any better than this…  I want to help you create success while helping you protect and preserve your wealth – it’s that simple.

For a look at all of today’s economic events, check out our economic calendar.

Chris Vermeulen
Chief Market Strategist


Midweek Market Drivers: Global Expand Of COVID-19, Situation In Europe, and US-China Tensions

The number of new COVID-19 cases across the globe has exceeded 5 million.

How the situation is evolving in the European Union?

Aside from Spain, which has had 1 blip of over  1,000, we’ve seen the most adversely affected see sub-1,000 new cases each day for 9 consecutive days. The most affected being France, Germany, Italy, and Spain.

We had some concerns over how quickly governments were easing lockdown measures. When we factor in the 2-week incubation period, these numbers are fairly positive. They should give the markets some hope that a 2nd wave can be avoided.

Governments are about a 4-5 day period and about a week out to convince the more pessimistic…

If we look at China as a base case that should also be supportive.

We can then also look at virus vaccine news that has also been market positive late last week and early this week.

It appears that the coronavirus crisis continues to hit the global economy dramatically.

In the meantime, are there any improvements?

From the economic data, shifting through May and June numbers, the focus remains on employment and business and consumer confidence figures.

In Germany this week, we saw both business and consumer confidence improve, coming off the back the easing of lockdown measures.

The key, however, remains labor market conditions, which need to materially improve to drive confidence and consumption.

Expect these to be the key areas of focus and to drive the market near-term.

A pickup in consumption would drive a service sector recovery that would then filter through to the manufacturing sector.

Despite positive forecasts, the US-China conflict continues to be in the spotlight. Also, the Chinese government introduced a new HK Securities Law.

How did these events affect the markets?

There was some skepticism over the phase 1 trade agreement. We then saw accusations fly over the cause of the coronavirus pandemic leading to a deterioration in relations.

China has responded with the HK Securities Law and the U.S government is expected to respond in kind this week. This could include sanctions.

The markets have been almost Teflon in the early part of the week. On Wednesday morning, however, we saw risk appetite tested, as focus shifted back to the U.S – China tensions.

This shift in focus came as Trump announced that the U.S will respond to China’s plans for HK.

Let’s see what happens there. Beijing is not going to sit back this time around, not after the year-and-a-half that it took to come up with a phase 1 trade agreement.

Risk appetite will be tested. We do have COVID-19 news to keep the markets buoyed and there is also vaccine talk to provide support.

U.S China tensions, that relationship isn’t going to improve any time soon. Could you imagine a China-Russia alliance against the U.S and anyone else who wants to jump on Trump’s bandwagon?

That would certainly give the markets a rough time, particularly with Iran there in the Middle East as well.

It seems like the US-China tensions do not influence the markets significantly.

Meanwhile, is there anything else notable in regards to commodities and geopolitics?

Other than COVID-19, vaccines, and U.S China relations, there’s very little else to consider from a global financial market perspective.

There is one thing to consider, however, looking further down the track. Will the markets be as optimistic about the economic recovery once June stats begin to come out.

We saw May’s economic indicators show economic activity pickup from the depths of the abyss in April figures.

If we see June numbers fall off from May, then that optimism will come into question. May would have seen a larger pickup just due to the fact that economies were reopening.

I’m not convinced that the global economy will recover as quickly as the markets suggest. When you look at the equity markets and the rebound in the Aussie Dollar and Loonie. These are quite big moves when considering the doom and gloom ahead.

So, let’s see what happens when we begin to see June numbers…

For a look at all of today’s economic events, check out our economic calendar.

S&P 500 Technical Analysis: Is A Blow-Off Top Setting Up

Our research team has become increasingly concerned that the US Fed support for the markets has pushed price levels well above true valuation levels and that a risk of a downside price move is still rather high.  Recently, we published a research article highlighting our Adaptive Dynamic Learning (ADL) predictive modeling system results showing the US stock market was 12% to 15% overvalued based on our ADL results.  Today, Tuesday, May 26, the markets opened much higher which extends that true valuation gap.

We understand that everyone expects the markets to go back to where they were before the COVID-19 virus event happened – and that is likely going to happen over time.  Our research team believes the disruption of the global economy over the past 70+ days will result in a very difficult Q2: 2020 and some very big downside numbers.  Globally, we believe the disruption to the consumer and services sector has been strong enough to really disrupt forward expectations and earnings capabilities.  We’ve been warning our friends and followers to be very cautious of this upside price trend as the Fed is driving prices higher while the foundations of the global economy (consumers, services, goods, and retail) continue to crumble away.

Our biggest concern is a sharp downside rotation related to overvalued markets and sudden news or a new economic event that disrupts forward expectations.  Obviously, Q2 data will likely be a big concern for many, yet we believe something else could act as a catalyst for a reversion event.  Possibly global political news?  Possibly some type of extended collateral damage related to the global economy? Possibly something related to earnings expectations going forward through the rest of 2020 and beyond?  We believe things are not “back to normal” at this stage of the recovery and we believe the markets are moderately over-extended at this time.


This Weekly ES (S&P500 E-Mini Futures) chart shows our ADL predictive modeling system’s expected future price level targets which suggest the current market price level is 12% to 15% (or more) above these target levels. Remember, the ADL system uses a custom price mapping technology that is designed to identify “price/technical DNA markers” within historical data – then attempt to map out future price level activity and track the highest probable outcomes of these price DNA markers.  The objective of this research tool is to show us what type of price activity is highly probable based on historical data and predictive modeling research.  This unique trigger on the ES chart consisted of 5 historical DNA markers and suggests a future probability of 70% to 87% regarding future price target levels.

One aspect of our research while using the ADL predictive modeling system and our other tools it the concept of “price anomalies”.  These are rallies or sell-offs that extend beyond support or resistance levels and when price levels trend away from ADL predicted target levels.  We created the term “price anomaly” and explain it to our members as “some external force is pushing the price above or below the projected target level.  Once this force abates or diminishes, the price will likely move, very quickly, to levels near the ADL predicted target levels.”.

Currently, the US Fed is engaging in a moderate support effort for the US stock market and it is reportedly buying $5+ billion a day in bonds and assets.  Although it may seem impossible to fight the fed, we believe the markets (like nature) are almost impossible to fool and control.  We believe that price will react to market conditions and that future price rotation (both up and down) will continue to be more volatile than many traders expect.


This Custom Volatility Index chart highlights the extremely low levels recently established by the COVID-19 market sell-off.  These new low levels have created the deepest sell-off levels on this chart in 20+ years.  It has also established a new, highly volatile, downward price channel that our researchers are following to help us determine where resistance will likely be found.

We believe a new downward price rotation is setting up for some time in the near future that will establish a tighter price channel and assist us in determining when and where the ultimate price bottom will setup and complete.  With the VIX levels still near 27~29, we are certain that volatility has not decreased even though price levels have attempted a solid recovery over the past 8+ weeks.


This Weekly Custom Smart Cash Index chart highlights the true function of price within the US stock market and highlights the overall weakness still at play within the current markets.  Even though the NQ has rallied to near all-time highs, the Smart Cash Index is showing the broader market is still rather weak and that recent price activity has stalled into a sideways/flag formation.  The broader market buying that took place near the end of March 2020 and throughout April 2020 has stalled.  The Fed became the market for the past 8+ weeks and as the Fed diminishes its activity, it will be up to the markets to manage trends and future expectations going forward.

Our researchers are concerned that a sudden breakdown in the Smart Cash index may prompt a bigger downside price move in the global markets.  Our research team has continued to issue warnings to our members to run protective stops on any open long positions, to properly size trades to avoid excessive risks and to properly hedge your trading using precious metals, miners, and Bonds.  In short, these risks are very real.  You can still make a profit trading the long side of the markets, but we suggest that you take all the necessary steps to protect your trades.


This last Weekly Custom US Stock Market chart highlights two very important levels related to our Fibonacci Price Amplitude Arcs.  These arcs represent critical Fibonacci support and resistance levels that arc across time and price levels.  It is important to understand these levels will present very real inflections in price – at least we expect them to create price inflections.

Currently, there is the YELLOW Fibonacci price arc that is acting as resistance near the current highs and the MAGENTA Fibonacci price arc that is much longer-term.  This longer-term Fibonacci price arc may be stronger than the current shorter-term arc.  Our researchers believe the current Fibonacci arc levels on this chart will prompt price to “flag out” in a sideways price channel before potentially breaking downward.

As we continue to watch for weakness across these charts and trends, we urge skilled technical traders to be prepared for a sharp spike in volatility over the next 4+ weeks.  It appears we are only 2 to 4+ weeks away from reaching these major price inflection points.  Currently, we believe a downside move is the most probable outcome based on our ADL predictive modeling system results as well as the technical patterns seen on these charts.

Overall, we believe the increased volatility levels in the US stock market will present some incredible trading opportunities for technical traders.  Big swings, near-perfect technical patterns and setups, quick profits, and broader sector rotations.  This is the type of market where skilled technical traders can really enjoy a target-rich environment.  We just have to be selective in how we determine when to enter trades and to not take excessive risks.

Please take a moment to visit to learn more.  I can’t say it any better than this…  I want to help you create success while helping you protect and preserve your wealth – it’s that simple.

For a look at all of today’s economic events, check out our economic calendar.

Chris Vermeulen
Chief Market Strategist


Optimism Prevailed Last Week, but Have US Stocks Moved Too Far, Too Fast?

The major U.S. stock indexes finished higher last week on optimism over the reopening of the states’ economies and some positive developments in the quest to find a vaccine for coronavirus. That was in the beginning of the week. Later in the week, prices retreated as caution returned due to geopolitical tensions as China announced a plan to impose a new security law on Hong Kong and as a U.S. Senate bill was introduced that could force Chinese firms to delist from U.S. exchanges.

Over the short-run, it looks as if these issues are going to be a source of volatility, but longer-term, the huge government fiscal and Federal Reserve monetary stimulus packages should help investors weather the storm. However, traders do face headwinds due to simmering U.S.-China relations that could lead to a new “Cold War”. Furthermore, there is also the possibility of a second-wave of coronavirus cases that would wreak havoc on the already devastated economy.

Last week, the benchmark S&P 500 Index settled at 2955.45, up 91.75 or +3.20%. The blue chip Dow Jones Industrial Average finished at 24465.16, up 779.74 or +3.29% and the technology-based NASDAQ Composite closed at 9324.59, up 310.03 or +3.44%.

The World Has Changed Just Three Months Since the All-Time Highs Were Reached

The world is very different now, and the key fundamental conditions investors were watching in February have changed. At that time, investors were worried about whether the economy could stand to continue to add upwards of 200K new jobs each month to sustain the longest expansion in history.

Some experts saw the economy as “too hot”, but no one foresaw a global pandemic and ensuing unprecedented health-crisis-driven recession. Just like no one predicted the markets would turn from bull to bear in a matter of weeks, no one forecast solid week after week gains of more-than-30% over the past two months. This move has prompted the analysts at Morningstar Direct to call the rally since March 23, the strongest “bear-market rally” in the last 75 years and the sharpest two-month gain for the S&P 500 since before 1990.

Looking Ahead …

This weekend, the analysts at Edward Jones asked the question:  Has the market come too, too fast? Here are their three takeaways to consider:

This rally is based on the future, not the present.

The stock market is forward-looking. The market sold off in February and March because of the uncertainty around the growing pandemic and anticipation of a resulting recession. Stocks are now rallying on expectations that have leaped forward to the reopening of the economy and a rebound in GDP and corporate profits. Furthermore, the incoming economic data has been somewhat backward-looking.

Recoveries Take Time.

The stock market can and will move faster than the economy, but the two are connected, and over time, the path for the economy sets the foundation for market performance over the broader term.

It took 3.5 years for GDP to recover following the Great Recession of ‘08/’09, corporate profits rebounded more quickly, supporting solid stock market gains in 2009 and 2010.

There is reason to be optimistic while also realistic.

The pendulum of market sentiment has swung decidedly more positive lately. The market is pricing in a somewhat smooth re-opening of the economy. This essentially means that evidence of setbacks or slower progress pose potential risks in the near-term.

While we acknowledge that the size and duration of the current rally has been a pleasant surprise, we don’t expect it to persist at the same pace or magnitude uninterrupted. We anticipate headlines on the coronavirus, economic and earnings data to display a mixture of encouraging green shoots as well as periodic setbacks. This being said, continue to have appropriate and realistic expectations for near-term market swings and longer-term returns.

For a look at all of today’s economic events, check out our economic calendar.

Ray Dalio Suggests USA Is Entering A Period Of Decline And New World Order

We find it interesting how researchers attempt to compare history, sometimes ancient history, to the applicable functions of today’s world and to attempt to translate the decline of empires in the past to what is happening in today’s world.  Ray Dalio appears to be suggesting the rise of the Chinese economy and economic capabilities is going to threaten to unseat the US as a world super-power.

Within Ray Dalio’s article, he suggests the following which seems to sum up his cycle theory:

“In brief, after the creation of a new set of rules establishes the new world order, there is typically a peaceful and prosperous period. As people get used to this they increasingly bet on the prosperity continuing, and they increasingly borrow money to do that, which eventually leads to a bubble.

As the prosperity increases the wealth gap grows. Eventually the debt bubble bursts, which leads to the printing of money and credit and increased internal conflict, which leads to some sort of wealth redistribution revolution that can be peaceful or violent. Typically at that time late in the cycle the leading empire that won the last economic and geopolitical war is less powerful relative to rival powers that prospered during the prosperous period, and with the bad economic conditions and the disagreements between powers there is typically some kind of war. Out of these debt, economic, domestic, and world-order breakdowns that take the forms of revolutions and wars come new winners and losers. Then the winners get together to create the new domestic and world orders.”

Our own research team has completed quite a bit of research into cycles and super-cycles and, although we agree with Mr. Dalio that past Empires have collapsed and been replaced with more efficient and emerging soon to be a new world leader. Yet, in every instance in the past, the world has been transitioning from a rather disconnected economic structure where ancient empires, or rather the last gasps of ancient empires and wealth, have become threatened, gone to war, and declined.

WWI initiated with the assassination of Archduke Franz Ferdinand in Sarajevo on June 28, 1914.  Nearly a month later, the great powers of Europe were aligned into two coalitions: the Triple Entente – consisting of France, Russia, and Britain – and the Triple Alliance of Germany, Austria-Hungary, and Italy.  Thus, the lines were drawn between ancient European empires that led to the beginning of a new structure of world empires.

Throughout history, the biggest world empires are structured, grow into superpowers, and begin to decline.  Most of these last well over 200 to 250+ years.

The Ottoman Empire started in the early 1300s and ended in the early 1600s because of a war with Persia – more than 300 years.

The Arab Empire, Mohammed, started in 632 and ended in 1258 – more than 600 years.

The Roman Empire began in 753 BC and ended in 23BC – over 700 years.

Chinese Qing Dynasty started in 1644 and ended in 1911 – over 250 years.

Chinese Ming Dynasty started in 1368 and ended in 1644 – almost 300 years.

America’s strength as a nation started to build in the late 1800s/early 1900s. Our rise to a world power came at a great expense in the 1930s and 1940s – fighting Hitler and the Japanese while saving most of Europe and SE Asia in the process. Then, we managed to rebuild most of these areas over a very short period of time.

Additionally, the idea that the current world would allow a nation like China to become a world-power – threatening world-order, capitalism, democracy, and current global geopolitical order seem alien to our researchers.  There is one thing Mr. Dalio seems to ignore in his theories – the world has a choice in the matter – just like we did when Adolf Hitler threatened western Europe and with Hideki Tojo threatened the US and most of SE Asia.  We have a choice in how we address the rise of China and how we protect our freedoms, rights, and futures from any threat China may present.

Currently, the world is moving away from a China-friendly relationship after the COVID-19 virus event has wreaked havoc across the globe.  China’s rise over the past 25+ years has mostly been on the success of selling China as a cheap manufacturing center for the US and other stronger economies.  The process of growing China has been to take advantage of the relationships they’ve built with foreign business/banking.  This is all starting to come to a sudden halt which may put extreme pressures on China’s banking and credit systems over the next 20+ years.

Our research team put together this chart to highlight the past 100+ years of cycle/super-cycle trends.  When you review this chart, pay attention to the deep collapse of the heavy blue line from 1923 through 1939 – the span of the Great Depression.  We’ve highlighted the area of the Great Depression in BLUE.  We’ve also highlighted recessions in RED and MAGENTA.  Red areas being recessions in cycle areas where the cycles are trending lower and Magenta are where recessions happened in upward trending cycles.  Near the end, we’ve highlighted an area in YELLOW where we believe a new recession will emerge.

Now, as we align these cycle trends with price, we start to see a bigger picture emerge.  This SPY Weekly Log chart illustrates how our cycle analysis aligns with price trends quite well over the past 45+ years.  Our cycle research goes forward over 600 years and we can identify where and when price trends will likely set up, breakdown, or breakout as a result of our extensive cycle research.

Mr. Dalio’s comments, while somewhat valid in general scope, don’t necessarily translate into real-world processes.  With the amount of wealth and new global alliances, inter-connected economies and the recent push attempt to right the many wrongs of the past 30+ years, the world appears to be much more aligned towards restoring some proper order and developing a real future where nations are held accountable and central banks may be forced to adopt a more conservative capital process in the near future.

Without giving away too many details, our cycles are point to a very important cycle event that will take place in the near future.  Many people are completely unaware of when and how this event will take place.  In fact, many analysts are simply guessing as to what may happen over the next 20+ years whereas we’ve actually mapped out 500+ years of detailed price cycles for the global markets.

We can promise you one thing right now – the global markets are going to continue to be very interesting for technical traders over the next 10 to 20+ years.  You don’t want to miss the opportunities that are setting up in the global markets and we strongly believe everything you are reading about cycles from others is superficial in structure and content.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts. These simple to follow ETF swing trades have our trading accounts sitting at new high water marks yet again this week, not many traders can say that this year. Visit my Active ETF Trading Newsletter.

If you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals which we issued a new signal for subscribers.

For a look at all of today’s economic events, check out our economic calendar.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.


USD/JPY Fundamental Weekly Forecast – Traders Will Be Eyeing Simmering US-China Relations

The Dollar/Yen rose last week with increased demand for risky assets driving the price action most of the week. Gains were capped late in the week as investors sought protection in the Japanese Yen due to simmering tensions between the United States and China.

With the spread between U.S. 10-year Treasury Notes and Japanese Government Bonds extremely tight, the price action in the Forex pair is likely to be primarily influenced by risk sentiment.

Last week, the USD/JPY settled at 107.615, up 0.445 or +0.42%.

Positive for the U.S. Dollar will be demand for risky assets. Risk sentiment is likely to rise as more countries report optimistic coronavirus results and countries continue to loosen lockdowns and restrictions. Furthermore, any news regarding successful vaccine results are also expected to underpin the Dollar/Yen.

Stock market weakness and a second-wave of coronavirus outbreaks could weaken the Forex pair. However, the primary concern for investors is likely to be an escalation of tensions between the United States and China.

Bank of Japan Launches New Loan Scheme

The Bank of Japan decided on Friday to launch a new lending facility that aims to channel more funds to small and midsize businesses suffering from the economic blow of the coronavirus pandemic.

In an emergency policy meeting, the central bank also extended the deadline for a series of measures it has deployed to combat the virus fallout, including accelerated corporate debt buying, by six months to March 2021.

As widely expected, the BOJ kept monetary settings unchanged including its short-term interest rate target of -0.1% and a pledge to guide the 10-year government bond yield around 0%.

In an outline of the scheme released in April, the BOJ had said the new facility would offer zero-interest loans to financial institutions that boost lending to small firms by tapping government guarantee programs. It also offered to pay 0.1% interest to lenders that boost such loans.

Weekly Forecast

Risk sentiment will drive the USD/JPY this week as ties between the U.S. and China come under further strain, potentially threatening the “Phase One” trade deal signed earlier this year.

Tensions between the world’s two largest economies have flared on multiple fronts in recent days. China is poised to impose a new national security law in Hong Kong following months of anti-government protests, raising further questions about Beijing’s control over the city and likely evoking the ire of the U.S. and other Western powers which supported pro-democracy protesters.

Already engaged in a blame game over the coronavirus pandemic, discord between Washington and Beijing has spilled over into the financial markets last week after the U.S. Senate passed legislation last Wednesday that could restrict Chinese companies from listing on American exchanges unless they abide by U.S. regulatory and audit standards.

A Chinese government official said last Thursday that Beijing will not flinch in the face of any escalation of tensions with the U.S., but stressed that economic recovery and cooperation should be the priority, according to Reuters.

For a look at all of today’s economic events, check out our economic calendar.