Friday, November 29, 2019

100% Measured Moves May Signal a Top

One type of Fibonacci price structure we use to attempt to measure price trends and identify potential tops/bottoms is the “100% Measured Move” structure. This is a price structure where a previous price move is almost perfectly replicated in a subsequent price trend after a brief period of retracement or price correction. These types of patterns happen all the time in various forms across multitudes of symbols to create very solid trading signals for those that are capable of identifying trends and opportunities using this technique. If you want my daily analysis and trade ideas, be sure to get my updates by joining my free trend signals email list.

The first thing we look for is a strong price trend or the initially confirmed reversal of a price trend. We find that these trending price ranges and initial “impulse trends” tend to prompt 100% measured moves fairly accurately. The explosive middle trend is where one can’t assume any type of Fibonacci 100% measured move will happen. Those explosive moves in a trend that tend to happen in the middle of a price trend are what we call the “expansion wave” of a trend and will typically be 160% or more the size of the initial impulse trend.

These trade setups we call the “100% measured moves” are naturally occurring price rotations that skilled traders can use to identify strong trade potential setups. They are more common in rotating markets where a moderate trend bias is in place (for example in the current YM or ES chart).

First, let’s take a look at this YM Weekly Chart to highlight the most recent 100% Measured Move. The original upside price move between June 2019 and July 2019 resulted in a 2787 point price rally that replicated between August 2019 and November 2019 – after a brief price retracement. Currently, price is rotating near the peak of this 100% measured price move near 27,875 while attempting to set up a new price trend.



In this ES Weekly example chart, we see a 100% Measured Move that originated in June 2019 and ended in July 2019 – just like on the YM chart. Although the completion of the 100% measured move didn’t originate until the low that formed before price rallied to take out the previous high near 3029.50. Remember, the other facets of Fibonacci price theory are also still at play in the markets while these 100% Measured Moves are taking place. Thus, rotation between a previous price peak and valley (without establishing any new price highs or new price low) are considered “price rotation” – not trending. The 100% Measured Move that did take place recently did complete a full 100% advancement and is now stalling near the 3040 level peak.



If you are not familiar with some of my forecasting and trading strategies for trading the S&P 500, or my gold trading signals be sure to click those links to see some pretty interesting charts like these.

SP500 Index Trend Identification and Trade Signal System



Cycle and Price Prediction System



Concluding Thoughts

Once these 100% measured moves complete, price usually attempts to stall or wash out a bit before attempting to establish a new price trend. At this point, given the examples we’ve illustrated, we believe the US market will enter a period of rotation and moderate volatility as these 100% measured moves have completed the upside price advance for now. Some level of price rotation after these 100% measured moves have completed will potentially allow for another attempt at a future 100% price advance after setting up a new price leg.

These techniques don’t always work, we recently got stopped out on a TVIX (vix/volatility trade for a loss) but we just close out our thirst natural gas trade for a quick 7% profit. The previous UGAZ trade netted 20%, and the one before that was 7.95%.

I can tell you that huge moves are about to start unfolding not only in metals, but 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

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.

I urge you to visit my Wealth Building Newsletter and if you like what I offer, join me with the 1 or 2 year subscription to lock in the lowest rate possible with our BLACK FRIDAY offer, PLUS get a FREE BAR OF GOLD and ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next set of crisis’.

Chris Vermeulen
The Technical Traders



Stock & ETF Trading Signals

Monday, November 18, 2019

When Crude Oil Collapses Below $40 What Happens - Part III

This, the final section of this multi-part research article, will continue our exploration of the consequences that may result from our ADL predictive modeling system’s suggestion that Oil may continue to fall to levels below $40 over the next few months.

In Part I and Part II, we’ve highlighted what we believe to be very compelling evidence that any continue oil price decline from current levels may be setting up the global markets for a massively volatile price reversion – similar to what happened in 1929.

Prior to the stock market collapse in 1929 and the start of the Great Depression, commodity prices collapsed in 1921 and again in 1930. This commodity price collapse was the result of over-supply and a dramatic change in investor mentality. The shift away from tangible items and real successful investing/manufacturing and towards speculation in the housing markets and stock market.

Today, we want to focus on some of the core elements of our current global economic structure to attempt to present any more compelling evidence of a commodity collapse event that may happen after the past 7+ years of a massive credit market expansion event. Allow us to briefly cover the events of the past 20 years.

You can get my daily market analysis articles and trade ideas by opting into my free market trend signals newsletter.

1999: the DOT COM bubble burst after a mild recession in 1993-94 and a stock market rally from 1996 to 1999

September 11, 2001: Terrorist Attack on US soil. Shocked the world and global stock markets. Sent the world’s economy into severe contraction. US Fed lowered interest rates from 6.25% to 1.0% from 2001 to 2003.

2004-06: US Fed begins raising rates from 1.0% and gradually increased rates to 5.25% in August 2006: +525%. Pushing the US credit market, and housing market, over the edge and starting the 2008 Credit Crisis.

2007-2008: US Fed lowered interest rates to near ZERO over a very short 16-month span of time as the US Credit Crisis event unfolded.

2009-15: US Fed continued to keep interest rates near zero throughout this time-frame and continued to pump capital in the global capital markets with multiple QE and debt buying events. Other global central banks followed the US lead providing additional capital throughout the global markets. This massive expansion of credit/debt over a 7+ year span of time allowed foreign nations to “binge” on cheap US and Euro credit/debt while an Emerging Market and Foreign Market recovery were taking place.

2016-2019: US Fed raised interest rates from 0.08% to 2.42% over this span of time. Pushing US Fed rates up by the highest percentage levels EVER: +3025%

This continued global cycle of “boom and bust” has wreaked havoc on global consumers and business enterprises. Over the past 20+ years, various cycles of economic appreciation and depreciation have left some people considerably better suited to deal with these cycles while others have been completely destroyed by these events. Now, it appears we are entering another period of “early warning” as global manufacturing activity, growth and economic output appears to be waning. Are we entering another period like the 1929 to 1940 period of the US where a global economic contraction resulted in a deeper economic recession/depression and took 15+ years to recover from?

The US Fed has recently started acquiring assets again – at a far greater rate than at any time since 2012. It is very likely that the US Fed is “front-running” a crisis event that is already starting to unravel again – possibly aligned with institutional banking entities and global credit/debt risks.

(Source: https://wolfstreet.com)

Chinese factory orders have continued to fall recently and the news is starting to trickle out of China that the US trade tariffs have done far greater damage than currently expected. This suggests that manufacturing, exports, and GDP for China have entered a massive decline. What happens next is that commodity prices collapse because of the lack of demand from manufacturers and consumers. (Source: https://www.yahoo.com/finance/) Chinese new loan origination rates have fallen to a 22 month “new low” – which suggests corporate and consumer borrowers are simply not willing to take on any new debt/credit at the moment. This happens when a population decides they want to “disconnect” from any economic risks and shift towards a “protectionist” process. (Source: https://finance.yahoo.com)

Recent news suggests that Chinese demand for European consumer and luxury goods has also contracted dramatically. Germany will release GDP estimates on November 14th. It is our opinion that the Chinese have already shifted into a more protectionist consumer stance and that would mean that demand for non-essential items (call them high-risk purchases) are very low at this time. If this is the case, the lack of true demand origination out of China/Asia could push much of Europe into a recession. (Source: https://www.yahoo.com/)

The last thing China would want right now is to blow the potential for any type of US/China trade deal – even if it means giving up more than they may have considered many months ago. More tariffs or any type of tit-for-tat retaliatory trade war would not be in the best interest of either party at this stage of the game. Who flinches first? The US, or China, or the rest of the world?

So, the question, again, becomes...“will a commodity collapse lead the global stock market into a prolonged period of price decline and/or a global recession over the next 10+ years?”

If so, can we expect commodities to collapse as they did after the 1929 stock market peak?

You may remember this chart from the earlier sections of this multi-part article. It highlights what happened leading up to the 1929 stock market crash and how early warning signs of manufacturing and agriculture weakness continued to plague the markets while speculation in housing and the stock market pushed certain asset values much higher near the end of the “Roaring 20s”.



Are we setting up for the same type of event right now where global trade, manufacturing, and agriculture are weakening after the 2008 Credit Crisis and we are meandering towards a repetition of the events that led to the “Great Depression”? Will commodities prices collapse to 2002 or 2003 levels for most items? Will Oil collapse to levels below $30 ppb over the next 6 to 12+ months? And what will happen to Gold and Silver throughout this time?



Can we navigate through these troubling events without risking some type of new collapse event or reversion event? Are the central banks prepared for this? Are traders/investors prepared for this? Just how close are we to the start of this type of event?

The answers lie in what we do now and how the commodities react over the next 12+ months. The one major difference between now and 1929 is that the world is far more inter-connected economically and there are more people throughout the world that have moved into the “economic class”. Thus, it is our opinion that any event that is likely to happen will be followed by a moderately strong recovery event – no matter how severe the outcome. The world is in a different place right now compared to 1929. Overall, only time will tell if our research and ADL predictive modeling system is accurate with respect to future oil prices.

We believe it is critical for all traders to understand what lies ahead and the risks involved in “playing dumb” about the current market environment. We recently authored an article titled “Welcome to the Zombie-land for investors” and highly suggest you read it. Our researchers will share this one component that should help to ease some of the stress you may be feeling right now – the most capable, secure, mature and best funded (reserves) economies on the planet will likely lead any recovery process should an event as this happen. Therefore, look for strengths in the most mature and capable economies on the planet if some new crisis event begins.

Even if a trade deal between the US and China were to happen today and eliminate all trade tariffs, would this change anything or would this simply pour fuel onto the “capital shift” fire that is already taking place with speculation reaching frothy levels?

If you want to earn 34%-50% a year return on your trading account with very few ETF trades then join us at the Wealth Building Newsletter today!


The Technical Traders



Stock & ETF Trading Signals

Thursday, November 7, 2019

Where is the Top for Natural Gas?

We wrote a very telling research article on October 24th, 2019. We never published it because we had other articles scheduled to be published over the next few weeks in the queue and because our subscribers get our trade alerts before the general public. At this point, we are sharing that past article as well as some current research for Natural Gas that should be very interesting to you.

Pay very close attention to the original October 24th article, below, and our prediction that the $2.75 to $2.85 level would be a likely target for the upside price rally from the basing level below $2.30. Currently, Natural Gas is trading at $2.87 – reaching our initial target level.

If our research is correct, strong demand and limited supply globally may push Natural Gas well above the $3.20 to $3.40 level after a very brief pause happens near $3.00. In fact, Natural Gas may be getting ready to rally past 2018 highs ($4.93) if the situation presents itself for such an incredible price rally. What would it take for a rally like that to happen? Much stronger demand for natural gas because of an early, extreme winter and extended global demand.

Price reacts to supply/demand imbalances. In this case, if the demand far exceeds the supply capacities headed into the end of 2019, we could easily see Natural Gas rally above $4.00 very quickly. Could it rally even higher and take out the $5.00 level? Absolutely it could if the proper dynamics continue related to supply and demand globally.

Current Daily Natural Gas Chart



Remember to read the link from October 5th. We’ve been warning of this move for more than 60+ days and have authored multiple research posts attempting to keep our followers aware of this setup. This trade setup was telegraphed for us many months ago. All you had to do was follow our research and stay aware of the trends as this momentum base setup in October near $2.25.

Natural Gas moved higher by nearly 2% on October 24th as our researchers predicted nearly a month ago. This incredible momentum base below $2.30 seems to be a very strong support level for Natural Gas. We believe this next rally may be bigger than the last rally which reached a high near 2.70. Our Fibonacci price modeling system is suggesting a target price of $2.95 to confirm a new upside price trend. This means the price would have to rally more than +26.5% from current levels to confirm a potentially much bigger upside price move. Can you imagine seeing Natural Gas climb to above $4.50 again – like last year?

Near the end of October 2018, Natural Gas began an upside price move that really excited investors. The first upside price leg began in mid-September, near $2.75 and rallied to a level near $3.35 – a +21.6% upside price move. After a brief 12 to 15 day pause, another price rally began in early November 2018 near $3.23 and continued very aggressively over the next 11+ days to rally up to $4.93 – a +57% rally.

We issued a natural gas trade using UGAZ to members and this week we locked in 38.7% profit on a portion of our position and there is still a lot of upside potential left.

Is the same type of price advance could be setting up for an early November price rally from the $2.30 level to somewhere above $3.50? This would result in a +50% price rally from recent lows without using any leverage which would be just amazing.

October 5, 2019: Natural Gas Reloads for Another Price Rally

Previous Natural Gas Forecast Daily Chart

Our proprietary Fibonacci price modeling system is suggesting the $2.95 price level is critical for any further upside price action to continue above $3.00. The price must cross above the $2.95 level on a strong closing price basis before we could consider any higher price levels to become valid. Our researchers believe that suggests the $2.75 to $2.85 level becomes a very real upside price target for skilled traders to pull some profits and protect any open long positions.



Previous Natural Gas Forecast Weekly Chart

This Weekly Natural Gas chart highlights our Fibonacci price modeling system’s results and the Bullish Trigger Level near $2.95 (The GREEN LINE). Pay very close attention to how quickly Natural Gas moved higher in November 2018. If another move happens like that in 2019, we could be setting up for a big gap higher followed by about 10 to 15+ days of incredible upside price action.



Currently, the price of Natural Gas has crossed the Daily Fibonacci price modeling system’s Bullish Price Trigger level near $2.29. This suggests that we are now in a confirmed bullish trend as long as the price stays above the $2.26 level on a closing price basis. We would expect a continued moderate price rally from these levels to move price away from the momentum base level over time – before any breakout upside price move may begin.

This could become one of the best trades, besides Silver and Gold, headed into the end of 2019. Get ready for some big volatility in Natural Gas as winter weather takes over much of North America.

November will be the month of breakouts and breakdowns and should spark some trades. I feel the safe havens like bonds and metals will be turning a corner and starting to firm up and head higher but they may not start a big rally for several weeks or months.

October was a boring month for most major asset classes completing their consolidation phase. Natural gas was the big mover in October and subscribers and I took full advantage of the bottom and breakout for a 15-22% gain and its till on fire and trading higher by another 3% this week already.

If you like to catch assets starting new trends and trade 1x, 2x and 3x ETF’s the be sure to join my premium trade alert service called the Wealth Building Newsletter.


Chris Vermeulen
The Technical Traders



Stock & ETF Trading Signals

Stock & ETF Trading Signals