Precious Metals ADL Predictions Getting Ready for a Big Move

This weekend we thought we would share some really important data and charts with all of you precious metals bugs/traders (like us). You probably remember our October 5th, 2018 call in Gold that has set off an incredible series of events for all of us.

We made a prediction that day that Gold would rotate higher from the $1200 level targeting the $1300 level, then stall and move lower to set up a “momentum base” near April 21st to 24th before accelerating much higher after June/July 2019. Our original research chart is shown below. But first, be sure to opt-in to our free market forecast newsletter

This incredible research targeted the $1600+ level by September/November 2019. We are only about $70 away from that level right now and we have new ADL research to share with all of our followers.

If you are a fan of our research or you can understand the value of the ADL predictive modeling system and what we have highlighted for our followers – you already know that any future ADL predictions for precious metals should be of particular interest to all of you. What are metals going to do over the next few months and how can you prepare for this move, let us help you try to prepare for this next move.

Check out these exciting charts full of opportunities that we will be sharing.

This Gold Monthly chat highlighting the ADL predictive modeling system results shows why gold traders need to be patient and wait for the next setup. That setup exists over the next 30 days as the ADL predictive modeling system is suggesting that Gold will attempt a downside price rotation to levels near $1490 before attempting another rally back above $1600. This is the next proper price rotation setup that traders need to look for. The second setup occurs in Jan/Feb 2020 where the price is expected to rotate from above $1600 to levels near $1540 before launching into another big rally to levels above $1870.

The Adaptive Dynamic Learning (ADL) predictive modeling system is one of the most incredible price modeling tools we use in our research. We’ve just shown you what our research tools believe Gold will do over the next 14+ months. We believe we are helping more traders and investors by proving our incredible research tools work better than any other technology solutions available in the market right now and are proving it by posting these types of charts many months before price can attempt to prove or disprove our research.

Now, one of the biggest moves is going to be in Silver and we’ve all been waiting for the incredible reversion of the Gold/Silver ratio. It is at that point when Silver begins to rally faster than Gold is rallying that we will see a true reversion in the Gold/Silver ratio. That event will result in an incredible rally in silver that could push the price of silver above $35 to $40 per ounce – or higher.

Our ADL predictive modeling system running on a Quarterly Silver chart highlights the opportunity that still exists for metals traders. Silver will continue to rally as Gold rolls higher. Silver will continue to rally to levels just below $20 over the next 8+months. The big breakout to the upside starts to take place Q3 2020. That move will push Silver prices to levels above $20 where a brief rotation will take place. By Q1 2021, the price of silver will be rallying extensively and the cat will be out of the bag in terms of what or why the metals are skyrocketing.

These moves in precious metals are going to be one of the most incredible opportunities for investors. There will be other swings in market sectors and major global market indexes as well. This is the time for all traders/investors to take advantage of the resources that are available to learn to take advantage of these setups. Our research team continues to deliver some of the most incredible research and predictive modeling results anyone has ever seen. If you can not see the value of being able to see 14 to 24 months into the future.

We urge you to consider finding resources and a team of researchers that can assist you over the next 12+ months as the moves in the global markets are going to be incredibly large and varied. Now is the time to take advantage of these opportunities and to find the right partners to assist you in finding the right trades.

Crucial Warning Signs About Gold, Silver, Miners and SP500

In early June I posted a detailed video explaining in showing the bottoming formation and gold and where to spot the breakout level, I also talked about crude oil reaching it upside target after a double bottom, and I called short term top in the SP 500 index. This was one of my premarket videos for members it gives you a good taste of what you can expect each and every morning before the Opening Bell. Watch Video Here.

I then posted a detailed report talking about where the next bull and bear markets are and how to identify them. This report focused mainly on the SP 500 index and the gold miners index. My charts compared the 2008 market top and bear market along with the 2019 market prices today. See Comparison Charts Here.

On June 26th I posted that silver was likely to pause for a week or two before it took another run up on June 26. This played out perfectly as well and silver is now head up to our first key price target of $17. See Silver Price Cycle and Analysis.

More recently on July 16th, I warned that the next financial crisis (bear market) was scary close, possibly just a couple weeks away. The charts I posted will make you really start to worry. See Scary Bear Market Setup Charts.

Concluding Thoughts

In short, you should be starting to get a feel of where commodities and asset class is headed for the next 8+ months. The next step is knowing when and what to buy and sell as these turning points take place, and this is the hard part. If you want someone to guide you through the next 12 - 24 months complete with detailed market analysis and trade alerts (entry, targets and exit price levels) join my ETF Trading Newsletter.

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

Join me with a 1 or 2 year subscription to lock in the lowest rate possible and ride my coattails as I navigate these financial market and build wealth while others lose nearly everything they own during the next financial crisis.

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 starting to present themselves will be life changing if handled properly.

Free Gold or Silver with Membership!

Kill two birds with one stone and subscribe for two years to get your FREE PRECIOUS METAL and get enough trades to profit through the next metals bull market and financial crisis!

Chris Vermeulen
The Technical Traders

How Close are the Markets from Topping?

Now that most of the U.S. Major Indexes have breached new all time price highs, which we called over 5+ months ago, and many traders are starting to become concerned about how and where the markets may find resistance or begin to top, we are going to try to paint a very clear picture of the upside potential for the markets and why we believe volatility and price rotation may become a very big concern over the next few months. Our objective is to try to help you stay informed of pending market rotation and to alert you that we may be nearing a period within the US markets where increased volatility is very likely.

Longer term, many years into the future, our predictive modeling systems are suggesting this upside price swing is far from over. Our models suggest that price rotation will become a major factor over the next 12 to 15+ months – headed into the U.S. Presidential election cycle of November 2020. Our models are suggesting that the second half of this year could present an incredible opportunity for skilled investors as price volatility/rotation provide bigger price swings. Additionally, our models suggest that early 2020 will provide even more opportunity for skilled traders who are able to understand the true price structure of the markets. Get ready, thing are about to get really interesting and if you are not following our research or a member of our services, you might want to think about joining soon.

We are focusing this research post on the NQ, ES and YM futures charts (Daily). We will include a longer term YM chart near the end to highlight longer-term expectations. Let’s start with the NQ Daily chart.

The NQ Daily chart, below, highlights our ongoing research, shows the 2018 deep price rotational low and the incredible rally to new all time highs recently. The most important aspect of this chart is the “Upside Target Zone” near the $8040 level and the fact that any rally to near these levels would represent an extended upside price rally near the upper range of the YELLOW price channel lines. We believe any immediate price rotation may end near the $7500 level (between the two Fibonacci Target levels near $7400 & $7600) and could represent a pretty big increase in price volatility.

This ES Daily chart highlights the different in capabilities between the NQ and the ES. While the NQ is already pushing into fairly stronger new price highs, the ES is struggling to get above the Sept/Oct 2018 highs and this is because very strong resistance is found between $2,872 and $2,928. It is very likely that the price volatility will increase near these highs as price becomes more active in an attempt to break through this resistance. It is also very likely that a downside price rotation may happen where price attempts to retest the $2,835 level (or lower) before finally pushing into a bigger upside price trend. The Upside Target Zone highs are just below $3,000. Therefore, we believe any move above $2,960 could represent an exhaustion top type of price formation.

This YM chart is set up very similarly to the ES chart. Historical price highs are acting as a very strong price ceiling. While the NQ is already pushing into fairly stronger new price highs, the YM continues to struggle to get above the Sept/Oct 2018 highs and this is because very strong resistance is found between 25,750 and 27,000. Please take notice of the very narrow resistance channel (BOX) on this chart that highlights where we believe true price support/resistance is located. We believe it is likely that a downside price rotation may happen where price attempts to retest the $26,000 level (or lower) before finally pushing into a bigger upside price trend.

As you can tell from our recent posts and this research, we believe price volatility is about to skyrocket higher as price rotates downward. Our predictive modeling systems are suggesting that we are nearing the end of this current upside move where a downward price move will establish a new price base and allow price to, eventually, push much higher – well above current all-time high levels.

We’ve issued research posts regarding Presidential election cycles and how, generally, stock market prices decline 6 to 24 months before any US Presidential election. We believe this pattern will continue this year and we are warning our followers to be prepared at this stage of the game. No, it will not be a massive market crash like 2008-09. It will be a downside price rotation that will present incredible opportunities for skilled traders. If you want more of our specialized insight and analysis, then please visit The Technical Traders to learn how we help our members find success.

Lastly, we’ve included this Weekly YM chart to show you just how volatile the markets are right now. Pay very close attention to the Fibonacci Target Levels that are being drawn on this chart. The downside target levels range from $16,000 to $21,060. The upside target levels range from $30,000 to $32,435. Top to bottom, The Fibonacci price modeling system is suggesting a total volatility range of over $16,000 for the YM Weekly chart and this usually suggests we are about to enter a period of bigger price rotation and much higher price volatility.

Right now, we suggest that you review some of our most recent posts to see how we’ve been calling these market moves, visit The Technical Traders Free Research. It is important for all of our followers to understand the risks of being complacent right now. The markets are about to enter a period of about 24+ months where incredible opportunities will become evident for skilled traders. If you know what is going to happen, you can find opportunities everywhere. If not, you are going to be on the wrong side of some very big moves.

Chris Vermeulen

Two Winning Trade Setups - GDXJ and ROKU

We are not always correct in our calls about the market. Professional researchers and analysts must understand that attempting to accurately predict the future outcome of any commodity, stock, index or ETF is impossible to be 100% accurate. Yet, we are pleased that our proprietary price modeling and analysis tools continue to provide us with very clear triggers and alert us to price moves before they happen.

Today, we are sharing two recent trades we executed with our members that resulted in some decent profits. The first example is our GDXJ trade. We had been in a Long position since before the beginning of 2019 expecting Gold and Miners to rally. Our price modeling systems suggested that after price reached $1300, we may experience a brief price pause over the next 45 days or so. Thus, we pulled the profits in this trade recently to lock in 10.5% profit and to allow us to re-enter when our modeling systems suggest the price pullback has ended.

The second example is our ROKU trade. We recently pulled 8.1% profit on a partial profit target execution for our members after a nice upside momentum move. This type of trade falls into our MRM (Momentum Reversal Method) trade trigger category and is supported by a momentum resurgence price move that can typically prompt prices to move +8~30% over fairly quick periods of time (under 20 days).

For almost all traders, we’ve found that understanding general market conditions, finding suitable trading triggers/setups and staying aware of the market dynamics at play in the global markets is very hard to accomplish. This is why we offer our members a very quick and easy way for them to accomplish all of these essential components for success with their membership to Technical Traders Ltd. Wealth Trading Newsletter.

•  Our Daily Market Video, which is typically under 10 minutes in length, covers all of the major markets, most commodities, the US Dollar, Bitcoin and many other elements of the markets.

• Combine this video content with our detailed market research posts, which you can read by visiting The Technical Traders Free Research, allows our members to not only learn from our video content but also to begin to understand and formulate their own conclusions based on our content.

• Lastly, we add our trading trigger/alerts feature to alert our members to superior trading setups that we find while running our proprietary trading models. We don’t post 40 trades a day hoping our members will find one or two they can make profits from. We are highly selective in our posts and attempt to only post the best opportunities for success.

Over the past couple of months, we have been developing a new members area application. It will allow you to have live access to our morning spike and gap trades and traders chatroom, our SP500 index momentum, and swing trades, plus our special MRM (Momentum Reversal Method) stock picks on small/mid-cap stocks which also all trade options so if you want to you can trade options on your own around our stock trades.

Last week we made huge progress and this week’s goals are to implement the instant and automated SMS and email alerts sent to you every time there is a new trade, stop, target hit, or we close a position. This will give you more time to see and execute the trades as needed. Keep in mind most swing trades can be entered 1-3 days after the trade alert at the same price or better price simply because we are not that perfect at timing the markets every move.

If you take a minute to review these example REAL TRADES (above) and review the information at The Technical Traders, we believe you will understand the value and resources we offer our members. Isn’t it time you found the right team of professionals to help you make 2019 an incredibly successful year?

Chris Vermeulen

How To Consistently Make Money Day/Swing Trading

This has been the best week in a long time for intraday trades. The last 4 days the SP500 gave us 8 trades and all 8 turned into winners. Each days turning generating between $300 a $1250 per ES mini contract, although these can be traded using the SPY or 3X index ETFs.

Subscribers who day trade are taking this pre-market analysis and setups and making a weeks wage within 1 – 3 hours in the morning before lunch.

What makes these trade triggers is that they are the BROAD market SP500 so if you day trade other stocks knowing the short term market direction each morning add so much power to your other day trades for timing entries and exits.

SPY ETF 10 MINUTE CHART

This chart focuses on today’s spike higher and gap lower. both these played out once again and are based strictly on technical analysis and statistical analysis.

If you want to be notified of these types of trades each week 

subscribe to our Wealth Building Trading Newsletter Today!

JOIN WEALTH BUILDING NEWSLETTER - CLICK HERE

The SP500 Breaks 2018 February Lows - What Next?

The ES (S&P e-mini contracts) broke the support level from the February 2018 lows immediately after the US Federal Reserve announced a 25 bp rate hike this week. This breakdown below the February 2018 lows is concerning because it indicates that previous support is not holding and we could be in for further downside price activity.

We are preparing a detailed research post for early next week regarding a broad range of US markets as well as how our proprietary price modeling systems are reflecting this recent price move. What we can suggest to all investors is play small positions at the moment and prepare for increased volatility. There is near term support that may come into play soon, but overall the markets are reacting to a deleveraging event that could see prices push below 2400 before finding true support.

Visit The Technical Traders to read all of our recent research posts and see what we believe will be the big movers in 2019.

Chris Vermeulen

Crude Oil and Bitcoin Hit New Yearly Lows

For the first time in a year WTI crude oil is traded below $54 a barrel hitting a low of $53.63. Oil fell as much as 6% as fears are surfacing that OPEC's planned production cuts will do little to stave off a surge in global stockpiles.

Bitcoin finally made a significant move to break out of the tight trading range that it had been trapped in. Unfortunately for Bitcoin bulls, it was not the move that they were looking for as it dropped almost 13% on Monday and continued lower Tuesday shedding another 4.8% to trade at the new yearly low of $4,547.00. The cryptocurrency is now down more than 60% year to date and more than 70% since its all time high. Where will it stop? $3000, $2000 or $1000?

Not to be outdone by oil and Bitcoin, stocks are all continuing the sell off that started Monday with the S&P 500 dropping 1.6%, the DOW is once again below 25k, shedding 2% and the NASDAQ is trading back below 7,000 losing 1.6%. The recent sell off has once again pushed the stock market back below the yearly open, shedding all of the gains that came with record highs earlier in the year which has driven all three indexes into correction/bear market territory. It's looking more and more like we have a good to chance to end the year lower unless we get the Santa Clause rally.

Jeremy Lutz
INO/MarketClub

Crude Oil and Bitcoin Hit New Yearly Lows

For the first time in a year WTI crude oil is traded below $54 a barrel hitting a low of $53.63. Oil fell as much as 6% as fears are surfacing that OPEC's planned production cuts will do little to stave off a surge in global stockpiles.

Bitcoin finally made a significant move to break out of the tight trading range that it had been trapped in. Unfortunately for Bitcoin bulls, it was not the move that they were looking for as it dropped almost 13% on Monday and continued lower Tuesday shedding another 4.8% to trade at the new yearly low of $4,547.00. The cryptocurrency is now down more than 60% year to date and more than 70% since its all time high. Where will it stop? $3000, $2000 or $1000?

Not to be outdone by oil and Bitcoin, stocks are all continuing the sell off that started Monday with the S&P 500 dropping 1.6%, the DOW is once again below 25k, shedding 2% and the NASDAQ is trading back below 7,000 losing 1.6%. The recent sell off has once again pushed the stock market back below the yearly open, shedding all of the gains that came with record highs earlier in the year which has driven all three indexes into correction/bear market territory. It's looking more and more like we have a good to chance to end the year lower unless we get the Santa Clause rally.

Jeremy Lutz
INO/MarketClub

See How Our Predictive Model Suggest a Massive Market Rotation During the U.S. Elections

Just in time for what appears to be a potentially massive market price rotation, our researchers have put together this post to highlight what we believe will become a surprise price correction in the US Equities markets. Our team of researchers believes the correlation of our predictive modeling tools, predictive cycle tools, and other indicators are set up for what may become a massive 5 - 8% price rotation over the next 60 days.

We were expecting this rotation to start unfolding around mid-September (now) but at this time the technical are still bullish so we are not betting against the market just yet.

The combination of new US tariffs ($200 Billion about to hit in the China trade war), as well as a combination of technical issues with regards to Technology Stocks and retail expectations, could jolt the market if a correction does take place as our predictive modeling tools suggest. A simple rotation of 2 - 3% is fairly common in the markets. These predictive modeling solutions are suggesting we are just 4 - 5 days away from the start of a much bigger correction in the US Equities and Indexes.

We believe the coming US elections in combination with the other aspects of the global economy are going to drive a downward price correction that many people are not expecting right now. But there is one pocket of stocks that could benefit from this tariff stuff which members or our Wealth Building Newsletter just got long today!

Anyway, Let’s take a look at some of our index charts to see how this will likely play out.

This first chart is a Daily ES chart showing our Adaptive Dynamic Learning (ADL) predictive price modeling tool. The YELLOW/CYAN dashed lines over the price bars and into the future show the highest probable outcome from the ADL predictive modeling analysis. This instance that predicts a 5 - 6 day price advance before a price peak sets up consisted of 105 unique instances of correlative price data making up this predictive analysis. In other words, 105 unique instances of similar predictive price patterns and predicts future price moves based on the highest likely outcome of all instances of data.

In this case, the ADL modeling system is suggesting we have about 4 - 6 more days of moderately higher price activity before a price top/peak will setup – prompting a new downward price trend.

This ES Weekly ADL price chart correlates with the Daily chart almost perfectly. The Weekly chart predicts one additional week of upward price action before a massive 5 - 6% price decline drives prices lower. This massive price rotation executes over a 1 to 2 week span before briefly stalling, then an additional price decline of about 2% sets up driving prices to a predicted low near $2670 (-8.58%) on November 1, 2018 (just before the US elections).

This ADL analysis was generated by 112 unique instances of similar price data and the combined highest probability outcome is shown by the YELLOW and CYAN dashed lines on the chart. Simply put, we have a very high probability of a 5 - 8% price correction setting up over the next 20+ days in the U.S. Equities markets with a projected bottom setting up near $2670.

This last Weekly Transportation Index chart displaying the ADL predictive modeling system paints a very interesting picture when you combine it with the two earlier charts. The Transportation index typically leads the major markets by about 3 to 6 months. We have seen continued upside price advances in the Transportation Index over the past 6 months which leads us to think the US equities markets will continue to push higher overall.

Yet, this Weekly ADL predictive modeling chart shows two massive price rotations are likely to unfold before the end of 2018. The first one is set up for a downside price rotation, ending near $10,800, starting the week of September 17, 2018, and lasting about 3 - 4 weeks. Then, the ADL predicts the Transportation Index will rocket higher, near $11,800, for about 5 - 6 weeks before falling again to retest the $10,800 lows near early December 2018.

We believe critical global news and expectations regarding global trade, banking and credit may become the catalysts for these moves. The US is expected to enact over $200 billion in trade tariffs this week with China. We believe the ADL predictive modeling system is capable of identifying these massive price rotations and predicting the future rotations simply because of the massive amounts of data that it is capable of crunching. This Weekly ADL prediction consisted of 112 unique price instances and displays only the highest probable outcome. In other words, our predictive modeling system is suggesting these price moves are likely to happen based on its analysis with a greater than 50% probability.

Please pay close attention to our research posts and other articles throughout the end of this year and early into 2019. As we have been attempting to warn our followers, expect increased volatility and wider price rotation throughout the end of this year.

We expect to find a number of incredible opportunities for our members over the next few months and we have already been incredibly successful throughout this recent price rally. Our ADL systems predicted this upside price move in February of 2018 and we have stuck with it. Now, the ADL is predicting a massive rotation is about to take place – somewhat similar to February 2018. If you want to learn how to profit from these moves, visit The Technical Traders to learn how we help our members stay ahead of these types of market moves.

Chris Vermeulen
The Technical Traders Ltd.

Today's Gap Fill and Prediction Complete, What's Next?

Subscribers of our Technical Traders Wealth Building Newsletter were told before the market opened that stocks were set to gap higher and then fill the price gap. Only 12 minutes after the market opened the gap window was filled for a 9.5 pt move in the SP500, which is a quick $475 profit for those trading futures, or $103 profit per 100 shares traded of the SPY ETF.

Yesterdays Gap Fill Forecast

If you want to know what the market are going to do today, this week, and next month be sure to subscribe to our new and improved market trend forecast and trading newsletter....

Visit "The Technical Traders ETF Cycle Trader" Right Here

Positioning for “Swan Type” Disasters

Recently, the US, China and portions of SE Asia have been hit by massive hurricanes and cyclones. As investors, it is often difficult to understand the mechanics of how these types of disasters result in opportunities while thousands are attempting to rebuild and survive. Yet, as investors, it is our job to prepare for these outcomes and attempt to foresee risk and opportunities.

Over the weekend, we expecting Hurricane Irma to hit Florida and most of the South US, one should be asking the question, “How will this drive the markets over the next few weeks/months?” Let’s explore this question with some hard data and analysis.

US Population Density

The population in the South Eastern US is rather dense. There are also a number of key economic locations that could be disrupted if the storms starts to drift eastward.

Economic Output by Region

Consider that the South Eastern US represents a minimum of 1.6~2.2% annual GDP output.

When one considers the amount of destruction, disruption and economic decline that could be the immediate result of disasters such as hurricanes, one has to think about how the global markets will react to this level and type of event?

In comparison to the other geographic regions of the US, the South Eastern portion of the US still represents a substantially large portion of annual economic output/activity.

A massive disruption as well as asset revaluation event could cause a “blip” in the US GDP representing at least 2~3 tenths of a percent and could result in hundreds of billions in actual losses, economic output losses and infrastructure destruction.

Because of this, and other potential future events, we are concerned that the US markets may be headed for a correction event or bear market event in the near future. In the past, we have attempted to illustrate this potential by highlighting cycle events, key market breakouts and trends and, most recently, highlighted the 3-7-10 year cycle structures that play out in all markets. Now, we are setting up for an event that may unfold over the next 30~90 days as a “swan type event” that few are preparing for.

The US Dollar continues to slide. Our analysis showed that $92 was key support. Recently this level has been broken and we are concerned that the US Dollar may continue to slide lower. Overall, in terms of global competition, this may not be a tremendous hit. But in terms of purchasing power and the existing dominance of the US Dollar for trade, we could see some pressure in other areas.

In relation, our custom China/SE Asia Index is pushing toward the upward range of our price channel and could rotate lower on a Swan-type event (like a debt issue or political issue).

Oil is breaking downward as these global events and the transition to slower consumption continues to drive supply higher and higher. We could continue to see Oil based “Mini Swan Events” in countries that are dependent on Oil prices and income to support their economies.

US Banking and Insurance firms are sure to take increased risks with these types of events. As borrowers are displaced because of a “Swan type Event” and refocus on immediate needs/issues, delinquencies in mortgages, auto loans, credit cards and others will spike (quickly). This becomes a matter of survival (much like after the 2009 Credit Market Crisis) where people made choices to support immediate needs and not long term credit needs.

Metals, of course, have already started to make a move higher because of the risk of these events and global risks. Although, we still believe a short-term move lower (almost like a relief move) will play out over the next few weeks that will be the opportunity we have been waiting for. This move will allow investors to position metals trades for the potential longer term Swan event outcomes.

Lastly, our US Custom Index is continuing to provide a much clearer and defined picture of the Head-n-Shoulders formation that has us fixated on the potential of our VIX Spike dates, major cycle events, key rotations and, now, these potentially massive “Swan type events” to correlate into almost a Super-Swan Event. These hurricanes are passing events – they go away eventually. An economic event is something that takes much longer to resolve and restore. Much like the 2009 Credit Market Crisis, the results of a Swan type event can be long lasting and can result in massive asset revaluation.

We’re not saying the global markets are going to fall into another 2009 type event, but we are saying that our analysis is showing that “some type of event is setting up and IF it turned into a Super Swan event, then YOU (the investor) need to be aware of this potential”. If it simply turns into a correction or minor downturn, then you still need to be aware of this potential so you can profit from it – either way.

What will it take to setup and execute a series of trades that help protect against this type of possible Swan Event?

Join Active Trading Partners [visit here] today to learn more and follow our daily research reports to assist you in preparing for just this type of event. There is not a lot of time left before these potential events begin to play out. ATP will assist you by finding great trading opportunities and keeping you informed of the markets setups and potential moves/cycles.

Are you ready for the next Super-Swan Event? If not, join Active Trading Partners today.

Do These Three Things to Profit When Stocks Fall

By Jeff Clark, editor, Delta Report

The stock market has entered “the worst six months of the year.” The S&P 500 makes its best gains between November 1 and April 30. The period between May 1 and October 31 tends to be negative. The exact historical figures vary depending on who you ask. But there’s a good reason the Wall Street cliché machine advises to “sell in May and go away.” Stocks don’t do very well this time of year. And most of the major stock market disruptions of my lifetime occurred during this six month window.

Smart investors should take some time off. Enjoy the fruits of the “Trump rally.” Cash in your 13% gain on the S&P 500 since last Halloween and enjoy the summer. We’ll see you back in the action in time for Thanksgiving. But, if you want to make some money while the rest of the world is losing it, then stick around. Smarter investors could have the best six months ever.

Think about this for a moment…
Over the past 20 years, the Volatility Index (VIX)—a measure of the price investors are willing to pay to insure their portfolios against a significant market decline—has traded between a low of about 10 to a high of about 80. Recently, the VIX closed at 11—one of the lowest readings in the past 20 years. This happened at a time when the S&P 500 closed near an all time high. So with the broad stock market trading at its highest level ever, insurance is about as cheap as it has been in the past 20 years.

In other words, as we enter the worst six months of the year, put options—bets that the stock market will fall—are as cheap as they’ve been in two decades. This is a remarkable opportunity to profit as stock prices decline. Speculators can risk relatively small amounts of capital and achieve HUGE returns if stock prices fall. But there are a few tricks to profiting on the downside.

How to Profit as Stocks Fall
Over the long term, stocks go up. Don’t argue about it. That’s just how it is. The stock market moves higher over time. So short sellers—those folks who profit as stock prices fall—face an uphill battle.
Of course, there are situations where short sellers will ultimately profit even if the broad stock market moves higher.

For example, companies that commit fraud, take on insane amounts of leverage, or overhype a fad business almost always eventually crash and burn. But opportunities to short the stock in these firms are few and far between. For the most part, traders who are looking to short sell are going to trade on momentum. They’re going to look for overbought situations that look ready to reverse.

They’re going to buy cheap, out of the money put options. They’re going to be lightning fast, taking profits as the trade moves in their favor. And they’re not going to stress out about losing 100% on a trade because they kept their position size small enough to digest the loss.

How This Great Trade Went South
Let me tell you a story about the absolute best and worst put option trade I’ve ever seen. The trader made the most money I’ve ever seen on one put option trade, then he gave it all back. In September 1987, I was running the trading desk for a small regional brokerage firm. We had a handful of big name clients, folks who appeared regularly on the Financial News Network (the precursor to CNBC). One of these clients was a value oriented newsletter writer. His investment style was ultra-conservative and ultra-prudent.

So in September 1987, when this client bought a large number of put options on the S&P 100 (OEX), I took note. It was the first option position this client had ever purchased. He was buying these put options to hedge his managed-money portfolios against a sudden crash in the stock market.
It worked perfectly.

When the stock market crashed on October 19, 1987, the put options this client purchased rallied enough to completely offset the decline in his stock portfolios. It was, in my opinion, the most perfect hedge anyone executed prior to the crash. But it turned out to be a disaster for his accounts. You see, the money manager never sold the options.

Despite the market crashing, despite the VIX jumping above 100, despite the options he purchased trading for 20 times the amount he paid, he wanted to maintain the hedge. He wanted to keep his insurance in case stocks dropped even more.

They didn’t....When his options expired in November, even though the broad stock market was almost 25% lower than where it was when he bought the puts, his put options expired worthless. Stocks hadn’t rallied much off the October crash bottom. The S&P 500 was maybe 5% higher. The stocks this advisor held in his managed accounts were still suffering from the crash. And he never collected from the insurance he bought to protect his clients from the crash.

His clients suffered from the decline in the market, and they suffered from paying the option premium that was supposed to protect them from a crash. So what appeared to be a brilliant move in September 1987 turned out to be an expensive mistake by late November. His clients suffered from a decline in their stock holdings, and they also suffered as the OEX put options expired worthless.

A Simple Lesson
The lesson here is simple, when you’re betting on a broad stock market decline, you need to buy cheap put options AND you need to be willing to cash out of the trade when it moves in your direction—even if you think the move will go farther.
In my experience—which goes back more than three decades—if you want to profit on the short side of trading stocks, you need to get three things right…

1. You need to target stocks that are overextended to the upside and have negative divergence on the technical indicators.
   
2. You need to buy cheap put options, and you need to be willing to lose 100% of the premium you pay for the options. It should be less of a loss than short selling the stock.
   
3. You need to be willing to take profits quickly. As stocks fall, the implied volatility of the option premium increases. You don’t need to wait for the stock to achieve your downside target. The option premium will often inflate to reflect the downside potential. Be willing to sell into that.
   

Best regards and good trading,
Jeff Clark
Editor, Delta Report

Justin's note: Tomorrow, Jeff will be releasing a brand-new presentation on what he calls “the biggest breakthrough of my career.” In it, he’ll reveal a trading strategy that he’s been developing for over five years… has a success rate of 90.2%… average gains of 50%… and an average trade length of just two days.

E.B. Tucker, editor of The Casey Report, and Doug Casey have been talking all about it these past few months. They think it’s one of the most fascinating moneymaking ideas they’ve ever encountered.
Most people will be watching this presentation at 12 p.m. ET tomorrow… but as a Casey reader, E.B. will be sending you the video early, so you can start watching ahead of the crowd at 9 a.m.
We hope to see you there.

The article Do These Three Things to Profit When Stocks Fall was originally published at caseyresearch.com.

Why This Stock Rally Won’t Last…And What You Need to Do With Your Money Today

By Justin Spittler

Silver is sending us an important warning. Yesterday, the price of silver closed at $20.30, its highest price since July 2014. Silver is now up 45% this year. That’s nearly eight times better than the S&P 500’s 5.9% return. And it’s almost double gold’s 25% gain this year. If you’ve been reading the Dispatch, you know silver is rallying for the same reason gold’s taken off. Investors are worried about the economy and financial system.

Like gold, silver is real money. It’s also a safe haven asset that investors buy when they’re nervous. Unlike gold, silver is an industrial metal. It goes into everything from batteries to solar panels. Because of this, it's more sensitive to economic slowdowns. That’s why many folks think of silver as gold’s more volatile cousin.
Lately, silver has been acting more like a precious metal than an industrial metal. It’s soaring because the global economy is in serious trouble. Today, we’ll explain why silver is likely headed much higher. And we’ll show you the best way to profit from rising silver prices.

Silver has been in a bear market for the better part of the last five years..…
From April 2011 to December 2015, the price of silver plummeted 72%. This 56 month downturn was the longest silver bear market on record. As brutal as this bear market was, we knew it wouldn’t go on forever. That’s because silver, like other commodities, is cyclical. It experiences booms and busts. As you just saw, the losses in commodity bear markets can be huge. But the gains in commodity bull markets can be even bigger. During its 2008–2011 bull market, silver soared an incredible 441%. That’s why we watch commodities so closely. Every few years, they give you the chance to make huge gains in a short period of time.

On December 18, Casey Research founder Doug Casey said silver wouldn’t get much cheaper..…
Doug told Kitco, one of the world’s biggest precious metals retailers, that gold and silver were near a bottom:

My opinion is if it's not the bottom, it's close enough to the bottom. So, I have to be an aggressive buyer of both gold and silver at this point.

Doug’s call was dead on. Silver bottomed at $13.70 an ounce on December 17. That same day, gold bottomed at $1,051 an ounce. In other words, Doug was one day off from perfectly calling the bottom in gold and silver.

The price of silver has soared 49% since December..…
But it could head much higher in the coming years. Remember, silver soared 441% during its last bull market.
Silver is “cheap” too. It’s trading 58% below its 2011 high, even after this year’s monster rally. It’s also never been more important to own “real money.” That’s because it looks like the world is on the cusp of a major financial crisis. Doug explains:

Right now, we are exiting the eye of the giant financial hurricane that we entered in 2007, and we’re going into its trailing edge. It’s going to be much more severe, different, and longer lasting than what we saw in 2008 and 2009.

As longtime readers know, the last financial crisis caused the S&P 500 to plunge 57%. It sparked America’s worst economic downturn since the Great Depression. And it allowed the government to launch a series of radical “stimulus” measures, none which actually helped the economy.

BlackRock (BLK) sees tough times ahead too..…
BlackRock is the world’s biggest asset manager. It oversees $4.6 trillion. That’s more than the annual economic output of Japan, the world’s third biggest economy. BlackRock manages more money than Goldman Sachs (GS), JPMorgan Chase (JPM), and Bank of America (BAC). This makes it one of the world’s most important financial institutions…and one that probably understands the global economy better than almost any other company on the planet. Like us, BlackRock’s chief investment strategist, Richard Turnill, thinks the next few years could be very difficult. CNBC reported on Monday:

"This feels more and more like we're in an environment of low returns and high volatility for some time," Richard Turnill said on "Squawk Box.” "The period of political [Brexit] uncertainty ahead of us isn't going to last for weeks or quarters, but potentially for years," he said.

According to BlackRock, the “Brexit” made the global economy more unstable..…
If you’ve been reading the Dispatch, you know Great Britain voted to leave the European Union (EU) on June 23. The Brexit, as folks are calling it, shook financial markets from Tokyo to New York. It erased more than $3 trillion from the global stock market in two days. 

Then, stocks started to rally. By this Tuesday, global stocks fully “recovered” from the Brexit bloodbath. The S&P 500 and Dow Jones Industrial Average even hit new all time highs this week.

Many investors took this as proof that the worst was over. We, on the other hand, reminded readers to not lose sight of the big picture. We explained that stocks were rallying because they’re the least bad place to put your money right now. We encouraged you to not “get sucked back into the stock market.”

Larry Fink doesn’t think U.S. stocks should be rallying either..…
Fink is the chairman and CEO of BlackRock. That makes him one of the most powerful people in the world.
Like us, Fink isn’t “buying” this stock rally. CNBC reported yesterday:

"I don't think we have enough evidence to justify these levels in the equity market at this moment," Fink said Thursday on CNBC's "Squawk Box."

According to Fink, stocks are rallying for the wrong reasons:

He said the recent rally has been supported by institutional investors covering shorts, or bets that stocks would fall, and not individual investors feeling bullish.
"Since Brexit, we've seen ETF flows almost at record levels … $18 billion of inflows," Fink said. "However, in the mutual fund area, we're continuing to see outflows."
What that tells you is retail investors are pulling out, he said. "You're seeing institutions who were short going into Brexit … all now rushing in to recalibrate their portfolios."

In other words, this rally could fizzle out any day.

We recommend you invest with great caution right now..…
If you still own stocks, consider selling your weakest positions. Get rid of your most expensive stocks. Only hang on to companies that you know can make money in a long economic downturn. We also encourage you to own gold. As we said earlier, it’s real money. It’s preserved wealth for centuries because it possesses a unique set of attributes: It’s durable, easy to transport, and easily divisible. You can take a gold coin anywhere in the world and folks will instantly recognize its value.

We recommend most folks to hold 10% to 15% of their wealth in gold. Once you own enough gold, consider putting money into silver. It could deliver even bigger gains than gold in the years to come. To learn why, watch this short video presentation. It explains why the biggest threat to your wealth right now isn’t an economic recession, a stock market crash, or even a global banking crisis.

It’s something much bigger and far more dangerous. The good news is that you can protect yourself from this coming crisis. Watch this free video to learn how.

REMINDER: Our friends at Bonner & Partners are holding a special training series..…  
If you’ve been reading the Dispatch, you know part of our job is to share exciting opportunities with you when we hear about them. Today, we invite you to take part in a special training series hosted by Jeff Brown, editor of Exponential Tech Investor.

If you haven’t heard of Jeff, he’s an aerospace engineer, tech insider, and angel investor. His advisory, Exponential Tech Investor, focuses on young technology companies with big upside. For example, Jeff recommended an IT security company in October that’s already up 72%. Another one of Jeff’s picks has jumped 38% since February. And one is up 178% in less than a month.

In Jeff's training series, he reveals his secret to making money in technology stocks. He also talks about a HUGE opportunity taking shape in the technology space.  Click here to sign up for Jeff’s training series.

It’s 100% free and will take up less than 15 minutes of your time. Click here to register.

Chart of the Day

Silver stocks just hit a new three year high. Today’s chart shows the performance of iShares MSCI Global Silver Miners ETF (SLVP), which tracks large silver miners. As regular readers know, silver stocks are leveraged to the price of silver. It doesn’t take a big jump by silver for them to skyrocket. This year, silver’s 45% jump caused SLVP to soar 171%. It’s now trading at its highest level since April 2013.

If you think gold and silver are headed much higher like we do, you could put some of your money into gold and silver stocks. According to Doug Casey, these stocks could enter a “super bubble” in the coming years. Keep in mind, these are some of the most volatile stocks on the planet. Many gold and silver stocks can swing 5% or more in a day. If you can stomach that kind of volatility, you could see huge returns in gold and silver stocks over the next few years.

The article Why This Stock Rally Won’t Last…And What You Need to Do With Your Money Today was originally published at caseyresearch.com.

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Hundreds of Oil Stocks Could Go to Zero…Will You Still Be Owning One of Them?

By Justin Spittler

The largest shale oil bankruptcy in years just happened. If you own oil stocks, you'll want to read today's essay very closely. Because there's a good chance hundreds more oil companies will go bankrupt soon. As you probably know, the oil market is a disaster. The price of oil has plunged 75% since 2014. In February, oil hit its lowest level since 2003.

Oil crashed for a simple reason: There’s too much of it. New methods like “fracking” have led to a huge spike in global oil production. Today, oil companies pump about 1 million more barrels a day than the world uses.

Last year, America’s biggest oil companies lost $67 billion..…

To offset low prices, oil companies have slashed spending by 60% over the past two years. They’ve laid off more than 120,000 workers. They’ve sold assets and abandoned projects. Some have even cut their prized dividends.

For many oil companies, deep spending cuts weren’t enough…

The number of bankruptcies in the oil industry has skyrocketed….

Bloomberg Business reported earlier this month:

Since the start of 2015, 130 North American oil and gas producers and service companies have filed for bankruptcy owing almost $44 billion, according to law firm Haynes & Boone.

And that doesn’t even include two “big name” bankruptcies in the last couple weeks. Two weeks ago, Linn Energy filed for bankruptcy, making it the largest shale oil bankruptcy since 2014. It owes lenders $8.3 billion.

A week later, SandRidge Energy declared bankruptcy. It became the second biggest shale oil company to go bankrupt. The company owes its lenders about $4.1 billion. Ultra Petroleum, Penn Virginia, Breitburn Energy, and Halcón Resources also filed for bankruptcy in the past couple weeks.

Hundreds more oil companies could go bankrupt this year..…

The Wall Street Journal reported last week:

This year, 175 oil and gas producers around the world are in danger of declaring bankruptcy, and the situation is nearly as dire for another 160 companies, many in the U.S., according to a report from Deloitte’s energy consultants.

Defaults by oil and gas companies are already skyrocketing. The Wall Street Journal continues:

Oil and gas companies this year have defaulted on $26 billion, according to Fitch Ratings data. That figure already surpasses the total for 2015, $17.5 billion.

Fitch, one of the nation’s largest credit agencies, expects 11% of U.S. energy bonds to default this year. That would be the highest default rate for the energy sector since 1999.

Many investors thought the oil crisis was over..…

That’s because the price of oil has surged 80% since February. Dispatch readers know better. For months, we’ve been warning there would be more bankruptcies and defaults. We said many oil companies need $50 oil to make money. The price of oil hasn’t topped $50 a barrel since last July. Even after its big rally, oil still trades for about half of what it did two years ago.

Oil prices will stay low as long as there’s too much oil..…

Although the world still has too much oil, the surplus has shrunk in the past few months. In February, the global economy was oversupplied by about 1.7 million barrels a day. Thanks to U.S. production cuts, the surplus is now just 1.0 million barrels a day. The number of rigs actively looking for oil in the U.S. has dropped by 80% since October. This month, the U.S. oil rig count hit its lowest level in 70 years.

However, many other countries aren’t cutting production at all. Saudi Arabia and Russia, two of the world’s biggest oil-producing countries, are both pumping near-record amounts of oil. Frankly, these countries don’t have much choice. Oil sales account for 77% of Saudi Arabia’s economy. And oil accounts for 50% of Russia’s exports. If these countries stop pumping oil, their economies could collapse.

Low prices have made it impossible for some oil companies to pay their debts..…

U.S. oil companies borrowed nearly $200 billion between 2010 and 2014. If you’ve been reading the Dispatch, you know the Federal Reserve is mostly to blame for this. It’s held its key interest rate near zero since 2008. This made it incredibly cheap to borrow money. When oil prices were high, the debt wasn’t an issue. Companies made enough money to pay the bills. That’s no longer the case. Today, many oil companies are burning through cash to pay their debts.

To make matters worse, many weak oil companies have been cut off from the credit market..…

Before prices collapsed, oil companies could refinance their debt if they ran into trouble. This could buy them time to sort out their problems. These days, many banks will no longer lend oil companies money. Bloomberg Business reported last month:

Almost two years into the worst oil bust in a generation, lenders including JPMorgan Chase & Co., Wells Fargo & Co. and Bank of America Corp. are slashing credit lines for struggling energy companies…
Since the start of 2016 lenders have yanked $5.6 billion of credit from 36 oil and gas producers, a reduction of 12 percent, making this the most severe retreat since crude began tumbling in mid-2014.

Oil stocks are still very risky..…

But that doesn’t mean you should avoid them entirely. As we’ve said before, oil stocks have likely entered a new phase. You see, when oil prices first tanked, investors sold oil stocks indiscriminately. Both strong and weak stocks plunged. In other words, investors “threw the baby out with the bath water.” You often see this behavior during a crisis.

Exxon Mobil (XOM), the world’s biggest oil company, fell 34% since 2014. Chevron (CVX), the world’s second biggest, dropped 48%. Now that oil has stabilized, the stronger companies are separating themselves from the weaker companies. This year, Exxon is up 15%. Chevron is up 11%. The crash in oil prices has given us a chance to buy world class oil companies at deep bargains.

If you want to own oil stocks, stick with the best companies..…

If you're going to invest in the sector, there are four key things to look for: 

Make sure you buy companies that can 1) make money at low oil prices. You should also look for companies with 2) healthy margins 3) plenty of cash and 4) little debt.

In March, Crisis Investing editor Nick Giambruno recommended a company that hits all of these checkmarks. It has a rock-solid balance sheet…some of the industry’s best profit margins…and “trophy assets” in America’s richest oil regions. It can even make money with oil as cheap as $35.

The stock is up 9% in two months. But Nick thinks it could just be getting started. After all, it’s still 30% below its 2014 high. You can get in on Nick’s oil pick by signing up for Crisis Investing. If interested, we encourage you to watch this short presentation. It explains how you can access Nick’s top investing ideas for $1,000 off our regular price.

This incredible deal ends soon. Click here to take advantage while you can.

You’ll also learn about an even bigger “crisis investing” opportunity on Nick’s radar. This coming crisis could radically change the financial future of every American. By watching this video, you’ll learn how to profit from it. Click here to watch.

Chart of the Day

Oil and gas companies are losing billions of dollars, we’re in earnings season right now. This is when companies tell investors if their earnings grew or shrunk last quarter. A good earnings season can send stocks higher. A bad one can drag stocks down.

As of Friday, 95% of the companies in the S&P 500 had shared first quarter results. Based on these results, the S&P 500 is on track to post a 6.8% decline in earnings. That would be the biggest drop in quarterly earnings since the 2009 financial crisis.

Oil and gas companies are a big reason U.S. stocks are having such a horrible earnings season.

As you can see below, first-quarter earnings for energy companies in the S&P 500 have plunged 107% since last year. Keep in mind, this group includes Exxon, Chevron, and other blue chip energy stocks.

Again, if you’re looking to buy oil stocks, make sure you “look under the company’s hood” before you buy it. Steer clear of companies that are losing money and have a lot of debt.

The article Hundreds of Oil Stocks Could Go to Zero…Will You Still Be Owning One of Them? was originally published at caseyresearch.com.

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