Sunday, June 23, 2019

How to Time Market Tops and Bottoms

On this first full weekend of Summer, we thought we would revisit our June 3, 2019 research post regarding a price pattern we love to trade – the Fibonacci Extension Bounce. This pattern sets up fairly often and the key to understanding this pattern and where these trades present real opportunity is in understanding the price dynamics behind these extensions. There are many instances where a Fibonacci price extension level will fail to promote a price bounce or rebound – and the price will just keep trending higher or lower past the extension level.

You can read our original research post here that clearly shows the bottom and our price targets.

Pay very close attention to the price levels and setups of the charts within that June 3, 2019 post. These setups are based on what we term a “100% Fibonacci Extension” from a previous trend reversal (peak or valley). The concept of this trading pattern is that the initial “impulse” price move sets up the first leg of a move. The retracement price move sets up the entry trigger for the second price leg – the next 100% price leg. The bottom, in this case, of the second 100% price leg sets up the “end of the move” and the potential for a price rotation in the opposite direction (likely resulting in a 38% to 61%+ retracement move).

In both instances of our June 3 calls, Crude Oil and the ES followed through exactly as we predicted.

This first chart of Crude Oil shows how price bottomed near $52 and has recently advanced to levels near $58 after reaching the 100% Fibonacci extension levels. As this move higher extends to levels near the ORANGE moving average line on this chart and/or beyond the $58 to $59 target level we originally drew on our June 3rd charts, we would consider the upside price move “completed” based on our expectations. Yes, these types of trend could extend even further beyond our expectations. But our objective, as skilled traders, is to target and profit from the highest probability objectives – which was the move from $52 to near current price levels.

Follow the MAGENTA lines on these charts to see the Fibonacci Extension Pattern Setup. They are not hard to see on the charts when your eyes are trained to identify them.




This ES Daily chart shows the incredible +230 point rally that took place after our June 3 research post and after the Fibonacci extension pattern completed. It is really hard to miss the opportunity with a move like this. Again, follow the MAGENTA lines on this chart to see the Fibonacci Extension pattern setup.

At this point on the ES chart, the upside price rally has resulted in a 161% (roughly) upside price advance of the previous Fibonacci Extension pattern (last leg). This upside price leg range, 161%, suggests the upside price move should be close to ending soon. There is a possibility that price could advance to levels near 200% of the previous price leg range, but traders would be chasing a 25% further upside advance that may only be a low probability outcome.




Our advice for skilled traders is to pare back existing open long trade positions near these new all-time highs. The price advance appears to have reached levels that suggest the upside advance may be nearing an end point for the US stock markets. After such a big upside price leg, we have to be cautious near these new all-time highs that further price rotation may become a concern.

Oil, on the other hand, could continue to rally because it has only advanced 61% of the last Fibonacci 100% price leg. The global concerns regarding Iran and the US, as well as global economic concerns, could push Oil back up to the $60 to $62 level before reaching a peak.

Over the past 21+ months, we’ve highlighted some of the best tools and techniques we use to find great trading signals. This one technique, the Fibonacci 100% Price Expansion Leg, is just one of the tools we use to find trades and targets for our trade alerts for members.

The more one understands how price works and how the markets operate as a Symphony of price actions, one can find opportunities for great trades almost all the time. Skill and experience make the difference when deciding when to trade and what to trade and that’s what we provide.


We’ve now shown you two different price setups using Fibonacci price theory and the only thing we have to do is wait for a technical price confirmation before finding our entry trade. We’ll see how this plays out over the next few days and weeks. Remember, we are not proposing these as “major price bottoms”. They are “upside pullback trades” (bounces) at this point. A bullish price pullback in a downtrend.




Stock & ETF Trading Signals

Friday, June 7, 2019

Could Gold Rally Above $3750 Before December 2019?

We asked our researchers a question recently, “Could Gold rally above $3750 before the end of 2019?”. We wanted to see what type of research they would bring to the table that could support a move like this of nearly 200% from current levels. We wanted to hear what they thought it would take for a move like this to happen and if they could support their conclusions with factual conjecture.

Now we ask you to review these findings and ask yourself the same question. What would it take for Gold to rally above $3750 (over 200% from current levels) and why do you believe it is possible?

Our research team came to two primary conclusions in support of a Gold price move above $3750 :

A) The U.S. Presidential election cycle/political environment could prompt a vicious global economic contraction cycle of fear and protectionist consumer and corporate activity that propels the global economy into a deflationary (mini-crisis) event.

B) The global trade wars could complicated item A (the U.S. Presidential election cycle) and create an accelerating component to this global political event. The result is the mini crisis could turn into “ a bit more” than a mini crisis if the global trade wars prompt further economic contraction and disrupt global economic activities further.

Our research team suggested the following as key elements to watch out for in terms of “setting up the perfect storm” in the global markets.

A) The U.S. Dollar falls below $94 and continues to push a bit lower. This would show signs that the U.S. Dollar is losing strength around the world

B) The Transportation Index falls below $4350 and begins a bigger breakdown in price trend – targeting the $3000 level. This would indicate that global trade and transportation is collapsing back to 2007-08 levels.

C) Oil collapses below $45 would be a certain sign that global Oil demand has completely collapsed and the sub-$40 level would very quickly come into perspective as a target.

D) Global Financial stability is threatened by Debt/Credit issues while any of the above are taking place. Should any of the A, B or C items begin to take form over the next few weeks or months while some type of extended debt or credit crisis event is unfolding, it would add a tremendous increase of fear into the metals markets.

Our researchers believe the US Dollar is safe above the $91 level throughout the end of 2019 and that any downside risk to the US Dollar would come in brief price rotations as deflationary aspects of the global economy are identified. In other words, at this time, we don’t believe the US Dollar will come under any severe downside pricing pressures throughout the end of 2019. We do believe a downside price move in the U.S. Dollar may be setting up between now and early July 2019, but we strongly believe the $91 to $93 level is strong support for the long term.



The Gold Spot price / the US Dollar price chart highlights the incredible upside price move in Gold after 2001-02. It was almost a perfect storm of events that took place after this time to prompt a move like this to the upside. Not only did we have multiple US based economic crisis events, we also had a series of global economic “shifts” taking place where capital and assets were migrating all across the globe searching for superior returns. Could this happen again?? Of course it could. Although, we believe the next move in precious metals will be met with a completely different set of circumstances – very likely targeting foreign nations and not the U.S. economy.



This SPDR GLD chart shows a moderately safer play for investors and traders. The potential for a 20%+ upside price move over the next 60+ days is quite likely and our belief is that traders should be able to trade GLD throughout many of the upside and downside price rotations over the next few weeks and months. Ultimately, if you are skilled enough to pick proper entries, a decent trader could focus on GLD and pick up 65% to 120% ROI over a 7 to 12 month span of time.


Pay attention to where the opportunities are for your level of skill and capital. As we’ve been saying for many months, 2019 and 2020 will be fantastic years for active traders. Stick with what you can execute and trade well because there will be dozens of trades available to most traders over the next 16+ months.



Overall, our research team believes that precious metals have just begun to move higher on a WAVE C impulse move. We authored a research post suggesting that Gold and Silver were currently 20 to 30% undervalued back in late May 2019. The current upside move in Gold and Silver may be just the beginning of a much bigger move.

Ideally, we believe this initial impulse move will end above $1650. From these current levels, that reflects a 25% to 30% upside move in GLD. If any of the fear inducing items, listed above, begin to take shape over the next 12+ months, we could certainly see Gold above $2100 before too long. $3750 may seem like “shooting for the stars”, but all it takes is a combination of fear and deflation/inflation to drive investors into a gold hoarding mode just like we saw after 2003-2004 and that move prompted a 500% price rally from the $300 base level. That same move today would put the current price of Gold near $7800. It might seem like it could never happen – but it could.

Bottom line, we forecast the markets and share some extreme analysis like this to open your eyes to some potential opportunities. But, you cannot just jump into gold or miners after reading this and think you are set for success. The markets are never that simple. You must actively adjust and trade with the market and our daily video analysis is what will keep you on the right side of the market more times than not. This week, we locked in some profits on our long gold ETF, and gold miners ETF, why? because our analysis says both of these are at resistance and could pullback before heading higher. We don’t buy, hope and hold, we enter positions, lock in profits, rinse, and repeat over and over again.

Get my daily video analysis and trade alerts today by subscribing to the Wealth Building Newsletter.

Chris Vermeulen
The Technical Traders



Stock & ETF Trading Signals

Tuesday, June 4, 2019

Fibonacci Support May Signal Bounce in Crude Oil and Equities

We want to take a moment to point out that a Fibonacci 100% price move setup may prompt an upside price swing over the next few days and weeks. Many traders fail to identify this setup and get caught up in the current price trend. This happens because we lose focus on the fact that price always moves in segments or legs – from one peak or trough to another peak or trough. The process of creating these segments or legs is usually structured in these types of Fibonacci price increment, and Fib targets I have personally found to be the most accurate for spotting profit taking and turning points.

We provide two very clear examples of this type of setup and how it has worked in the past. We urge all traders to understand there are many examples of larger Fibonacci price expansion legs throughout history. These examples of the 100% Fibonacci price leg are unique instances of price movement and, after confirmation of a base/reversal, can become very valid trading signals.

This first example is the ES (E-Mini S&P Futures). You can see from this chart the earlier examples of the 100% Fibonacci price legs working in the October 2018 downward price move. The current downward price legs have set up a perfect 100% Fibonacci price expansion leg and we believe support may form near $2732.

We would normally wait for some type of price confirmation that this level is going to act as support – for example, a solid reversal bar or Japanese Candlestick price pattern. After confirmation is achieved, a price rotation equal to 60% to 95% of the last downward price leg can be expected.



This next example shows Crude Oil and the most recent downward two Fibonacci Price Legs. The first resulted in a very quick upside price rotation (highlighted by the green arrow near May 20). The second downside Fibonacci Price Leg just ended near $53.30.

It is our belief that Oil will find support near this $53.30 level and rally back above $56 from these lows. The only thing we are waiting for is some type of technical price confirmation of this bottom setup and we can expect a 4% to 8% upside price swing in Crude Oil.



Over the past 21+ months, we’ve highlighted some of the best tools and techniques we use to find great trading signals. This one technique, the Fibonacci 100% Price Expansion Leg, is just one of the tools we use to find trades and targets for our trade alerts for members.

The more one understands how price works and how the markets operate as a Symphony of price actions, one can find opportunities for great trades almost all the time. Skill and experience make the difference when deciding when to trade and what to trade and that’s what we provide.


We’ve now shown you two different price setups using Fibonacci price theory and the only thing we have to do is wait for a technical price confirmation before finding our entry trade. We’ll see how this plays out over the next few days and weeks. Remember, we are not proposing these as “major price bottoms”. They are “upside pullback trades” (bounces) at this point. A bullish price pullback in a downtrend.





Stock & ETF Trading Signals

Stock & ETF Trading Signals