Archive for Opinions – Page 2

NASDAQ Double Top & Price Channels Suggest Pending Price Correction

By TheTechnicalTraders 

– Our research team continues to attempt to navigate the difficult market dynamics ahead as traders’ concerns related to continued global economic functions persist.  We believe the US stock market has rallied well beyond sustainable levels and the recent move in the US Dollar and Precious Metals has issued a clear warning that global traders are not buying into the current valuation levels of the major indexes.  The NASDAQ (NQ) has rallied to new all-time highs at a time when a majority of the US Stock Market is contracting and concerns about future earnings/revenues continue to shock investors.  It is almost as if a large group of traders piled into the “Fed Recovery” message and ignored the fact that the COVID-19 virus event is vastly different than any other price correction we’ve experienced over the past 40+ years.

NQ DOUBLE TOP SETUP

Recently, the NQ setup a very clear Double Top pattern near a somewhat obscure Fibonacci level (85.4%).  The Double Top pattern is a common technical pattern that suggests a resistance has formed near the Double Top price level, near 11058.50. Next week, critical GDP data and economic data will be announced on Thursday, July 30.  We believe the move in Gold and Silver is foreshadowing an ominous series of data that will reflect a very clear 20% to 30%+ contraction in the US and global economy.  The Double Top pattern in the NQ could be a very strong warning that the FOMO (Fear Of Missing Out) rally may be over.

NASDAQ DAILY CHART

NQ 100% MEASURED MOVE SETUP

This NQ Weekly chart highlights the nearly 3,950 point rally from the low in December 2018 to the high formed on February 17, 2020.  The current low formed in March 2020, near 6628, to the recent peak level, near 11,085, represents a “100% measured price advance” of 4,430 points.  Yes, the current rally extended the 100% measured move by 12.15% – which often happens as price tests resistance or support. Measuring from Weekly closing bar to Weekly closing bar on this chart, the 100% measured move is only about 50 points away from a true 100% advance.

NASDAQ WEEKLY CHART

We believe this combination of technical price patterns suggests the US stock market, particularly the high-flying NASDAQ (NQ), may be setting up for a dramatic price decline.  Both the Double Top and 100% Measured Move patterns suggest price has reached a limit.  If our interpretation of these technical patterns is correct, after such an incredible price rally in the face of unsure future economic data, we believe a move back to 8,750 is not out of the question (or lower).

Before you continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

NQ FIBONACCI CHANNELS

Very few people understand the relationship of Fibonacci price theory and how it relates to price action.  Fibonacci Price Theory suggests that price must move higher or lower to establish new price highs or lows within a trend.  Obviously, the NQ has rallied to “new price highs” – thus the current trend is “bullish”.  Yet, a Double Top pattern is also a critical warning of resistance near the dual top level.  Additionally, a 100% measured price advance is another warning sign that price may have reached an upside limit.  Now, we add our proprietary Fibonacci Price Amplitude Arcs using a 0.854% Fibonacci extension level.

This extension level is not commonly used by many traders but is completely valid if you spend a bit of time exploring the Fibonacci Number Sequence and the relationship between the numbers.  In fact, there are a number of levels between the 0.75% and 1.0% common Fibonacci levels that are valid for traders.

We have drawn the 1.854% Fibonacci Price Amplitude Arc in a MEGENTA color to highlight just how critical this level appears on the Weekly price chart.  If our research is correct, we now have three technical/Fibonacci patterns that are setting up warning us that the NQ price may turn downward and begin a new downside price rotation.  When we combine this with the data that we are expecting this week (GDP, Consumer and other data), this could turn into a “knockout blow” for the high-flying NASDAQ.

NASDAQ DAILY – FIBONACCI CHANNELS

If you were paying attention, you already know that the US Dollar is under pressure and the Precious Metals are showing signs that fear is rising in the global markets.  This next week, and the weeks that follow, will likely result in global traders attempting to re-valuate expectations based on the level of destruction the COVID-19 virus has done to the US and global economy.

Our researchers expect a minimum of a 20% to 25% contraction in consumer and business engagement in the US – possibly much more.  In March 2020, our research team suggested the Q1 and Q2 GDP data could contract by as much as -10% to -15%, potentially pushing the 2020 yearly GDP level into a -5% or deeper level.  On Thursday, July 30, 2020, we’ll find out just how rough Q2 of 2020 really was for the US.

This is when the crap is likely to stick to the walls, so our advice would be to protect your open longs, prepare for increased volatility and don’t get married to any position you have right now.  If you have not already prepared for this move, do it quickly early this week.

If the news is bad enough, there is no reason why the US and global markets could not attempt to retest recent low-price levels again.  Remember, Fibonacci Price Theory suggests price is ALWAYS seeking new price highs or new price lows.  Just because the NQ has reached new price high levels does not mean the S&P500, Dow Jones or other indexes, which have not reached new all-time highs, could not collapse and attempt to find new price low levels.

Get our Active ETF Swing Trade Signals or if you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Passive Long-Term ETF Investing Signals which we are about to issue a new signal for subscribers.

Chris Vermeulen
Chief Market Strategist
Founder of Technical Traders Ltd.

NOTICE: Our free research does not constitute a trade recommendation or solicitation for our readers to take any action regarding this research.  It is provided for research and educational purposes only.  The Technical Traders Ltd. does not provide financial or investment advice, so please contact your financial advisor before making decisions about your personal finances.

 

 

In Honor of Silver’s Epochal Breakout

Source: Clive Maund for Streetwise Reports   07/23/2020 

Technical analyst Clive Maund charts the start of the “biggest silver bull market in history.”

The purpose of this update is to celebrate and mark silver’s powerful breakout from a giant base pattern that started to form as far back as 2013–2014, a breakout which has only happened during the past few days, July 21 and July 22, with Wednesday’s advance finally seeing it break clear above the resistance at the upper limits of the base pattern. While this doesn’t mean it can’t drop back again, it makes it less likely, and even if it does, it is likely to soon turn up again.

Quite clearly, when you are only two days into a bull market that is starting after the completion of a six-year-long base pattern, the probabilities are very high that it has much further to go, both in respect to time and magnitude of advance.

Wednesday’s breakout may very well have been triggered by the bellicose actions of the U.S. with respect to China in closing its embassy, or whatever it is, in Houston, which is a continuation of an increasingly hostile attitude to China, based on the U.S. attempt to tear down what it views as its main rival for global dominance.

Now, with its economy getting ever closer to imploding completely, the U.S. is looking to direct the mounting anger and frustration of its population toward a manufactured external enemy, which is what politicians always seek to do when their backs are against the wall.

Wednesday’s action was another step on the road to a major war, which is a normal consequence of economic depression. In addition to that, we had the ludicrous and laughable assertion that Russia has been trying to hack coronavirus research secrets, which is just another irrelevant distraction.

Regardless of what actually triggered the breakout, it was a valid and powerful breakout, as we can see on the charts set out below.

silver13year220720

Not surprisingly, the effect of silver’s breakout on all things silver was electrifying, with a good example being shown below, Kootenay Silver Inc. (KTN:TSX.V), which is a silver stock we went for back in May because its charts looked so strong, and which is already up 50%.

With the prospect of hyperinflation in the not too distant future due to relentless and increasingly desperate and extreme money-printing by central banks, the prospects for silver and silver investments have never been brighter as one thing we can look forward to is the biggest silver bull market in history by far.

This is a very good juncture at which to watch Mike Maloney’s interesting and insightful new video on silver entitled Silver Soars–Where to Next?

Originally published on CliveMaund.com on July 22, 2020.

Clive Maund has been president of www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years’ experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.

Disclosure:
1) Clive Maund: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. CliveMaund.com disclosures below. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Charts provided by the author.

CliveMaund.com Disclosure:
The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund’s opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.

Precious Metals Spike and Us Warn Of Danger – Part I

By TheTechnicalTraders 

– If you have not been paying attention to what is happening in Gold, Silver, and Platinum over the past 3+ days, then read this research article carefully.  If you have been paying attention to the move in Precious Metals, then keep reading to learn why this move is so important.  Here we go…

Precious metals have been on the move higher for much of the past 24+ months.  Yet, certain forces have attempted to quell the upside advance as global investors adopt a more fearful stance relating to the global economy.  As the COVID-19 virus event hit, a big downside washout move took place in Gold and Silver.

This type of low price rotation is a common pattern as traders are forced to liquidate precious metals positions to cover margin requirements related to open long positions in a deep downside price move.  After that washout move completed, we saw precious metals, particularly Gold, rally back to previous price levels while Silver meandered near $16~$17 for a while before breaking higher.

Our research team has been warning that Silver would become the Super Hero of metals in the near future and recently we issued further research posts to support the upside price move we’ve seen in Silver prior to the current big breakout rally.  Read some of our earlier posts here.

September 24, 2019: IS SILVER ABOUT TO BECOME THE SUPER-HERO OF PRECIOUS METALS?

May 29, 2020: METALS NEARING CRITICAL MOMENTUM FOR NEW PARABOLIC RALLY

July 13, 2020: GOLD & SILVER MEASURED MOVES

THE WARNING SHOT HASBEEN FIRED!

If you understand anything about Precious Metals and how the operate as a hedge against perceived risk in the global markets, then you already understand what I’m about to state…  This huge breakout move in Silver and Gold is a massive warning shot fired across the bow for global investors.  The idea that the US stock market can continue to climb to frothy highs while COVID-19 erodes the global economy, credit, debt and trade is moronic.  Yes, certain stocks are generating decent revenues and returns, but we are talking about a potential global economic contraction of nearly 20% to 30% or more over the next 16+ months.  40+ million US workers are currently unemployed and many states are already re-issuing “shutdowns” again because of surges in the COVID-19 virus cases.

The first warning shot has not been fired for all to see.  It was big, loud and easy enough for anyone with more than two brain cells to see.  This is how Precious Metals tells us that many global investors don’t believe the current US and global stock market valuations are legitimate.  It also pushes a very big concern for COMEX and other exchanges relating to the open short positions in Gold and Silver.

Short Volumes in Precious Metals have recently climbed from 10.86% of total Daily volumes to 15.29% over the past 7+ trading days.  Historically, these levels have peaked near 25% to 26% recently (Source: https://fintel.io/ss/us/wpm ).  We believe the institutional and private short-sellers are getting squeeze by a 50-ton press right now and that COMEX may have a massive shortage of deliverable material if this rally continues.  Many larger firms will simply want to “take delivery” of physical metals if they believe this is the start of a massive upside rally.

Before you continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

SHORT VOLUME RATIO CHART

SHORT VOLUME RATIO DATA

We authored a research article just last week suggesting multiple “measured moves” were about to take place in both Gold and Silver ().  As of this morning, Silver had reached our predicted measured move target near $22.95 and has started to stall.  Gold still has quite a ways to go to reach our target level near $1935.  The fact that Silver has already reached the initial measured move target suggests that Silver may contract and setup a new momentum base over the next 3+ days before attempting to move higher.  Gold, on the other hand, should continue to rally higher attempting to target the $1935 level while Silver sets up a new base (even though the new base may only last a few days).

This Daily Silver chart highlights the huge breakout move that recently took place and should send a big warning to all traders and investors throughout the globe – something big is taking place.  Precious metals don’t move like this unless there is massive risk in the markets.  The only thing our researchers believe is likely to happen is a surge in new COVID-19 cases pushing many states into shut-downs again and tanking the minor economic recovery process that has just started.  We believe the second phase of this process is extended consumer, retail, real estate and massive pension, debt and credit issues for consumers, cities, states and other entities.  All of this may only be 2 to 5+ months away from landing on our “deck”.

SILVER DAILY CHART

The S&P500, Down Industrials, Transportation Index, and SPY have all stalled recently after rotating near major resistance. The NASDAQ has pushed even higher as traders pile into the technology stocks which seem to be bucking the trends.  The US Federal Reserve will continue to attempt to support the markets throughout the remainder of 2020 and early into 2021, yet the US Presidential Election and the destruction to consumers may hit the markets before we can blink.  Delinquencies are starting to skyrocket and the housing market, which by all data measures seems to be rolling along, is starting to fracture.

We believe skilled technical traders must adopt a very cautious portfolio balance right now or risk a massive blowout event – similar to what happened in 2008-09.  This move in Precious Metals is a huge warning to anyone willing to pay attention.  In Part II of this article, we’ll go deeper into detail showing you what is likely to happen in the SPY and Precious Metals markets over the next 6+ months.

Get our Active ETF Swing Trade Signals or if you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Passive Long-Term ETF Investing Signals which we are about to issue a new signal for subscribers.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

NOTICE: Our free research does not constitute a trade recommendation or solicitation for our readers to take any action regarding this research.  It is provided for educational purposes only.  Our research team produces these research articles to share information with our followers/readers in an effort to try to keep you well informed.

 

This Chart Foretold Wirecard’s Collapse — Two Years Ago

While the scandal served as catalyst for the fire, the match was lit a long time ago

By Elliott Wave International

“Catastrophic Failure” — June 18 CCN

“Swift, Spectacular Implosion” — June 25 Alijazeera.com

“Doomsday” — June 18 Seeking Alpha

These are a few descriptions for Munich-based Fintech firm Wirecard, whose recent epic fall from grace is one of the biggest financial bombshells in Germany’s history. This chart captures the stock’s crater-making crash in June — from 104 euros per share, to ONE single euro.

10 out of 10 mainstream experts say the catalyst for Wirecard’s crash was the June 19 revelation that nearly $2 billion in supposed profits had mysteriously vanished from the company’s balance sheet. (If it was ever there to begin with). Dubbed the “Enron of Germany” by a June 29 CNBC article, Wirecard’s scandal led to the firing of its CEO, a bankruptcy filing, and a $4 billion IOU-zilla issuance to creditors.

Surmised the June 25 Reuters:

“The collapse of Wirecard, once one of the hottest fintech companies in Europe, dwarfs other German corporate failures. It has shaken the country’s financial establishment … A scandal like Wirecard is a wake-up call that we need more monitoring and oversight than we have today.”

True, except there has already been more than one “wake-up call” — as early as two years ago.

Back on January 23 — of 2018 — one news source revealed how Wirecard was well-known for “making highly unusual purchases,” using “adjusted metrics to inflate the appearance of earnings,” and skirting a 7-month long investigation into a deal that saw 175-285 million euros missing from the company’s coffers, leaving the sellers unpaid.

Yet, as that same article observed, these dubious episodes didn’t stop investors from “still placing their faith — and money — behind Wirecard.”

The ultimate show of that faith came in August 2018 when the green startup from a tiny Bavarian town known for beer gardens and bird-watching unseated Germany’s second-largest bank, 150-year old Commerzbank, from Germany’s venerable DAX stock market index.

And then came the latest Wirecard scandal, which supposedly “caused an 80% plunge in the company’s stock price over the last two days.” (New York Times, June 19)

All of which begs the question: Why did investors, after backing up Wirecard’s dubious practices for years, suddenly lose faith in the company?

And was there a way to foresee that change of heart?

Our friends at Elliott Wave International believe the answer is yes — and it comes down to investor psychology, or social mood.

Wrote Elliott Wave International’s President Bob Prechter in his New York Times best-selling book Conquer the Crash:

“When the social mood trend changes from optimism to pessimism, creditors, debtors, producers and consumers change their primary orientation from expansion to conservation.”

“Conservation” for investors manifests as doubt in the worth of a stock. Adds Prechter:

“People seem to take for granted that financial values can be created endlessly seemingly out of nowhere and pile up to the moon. Asset prices rise because those transacting agree that their prices should be higher…

“Conversely, for prices of assets to fall, it takes only one seller and one buyer who agree that the former value of the asset was too high. If no other bids are competing with that buyer’s, then the value of the asset falls, and it falls for everyone who owns it.”

The visible result of this shift in psychology occurs on a market’s price chart, as specific Elliott wave patterns.

Thus, one month after Wirecard became the DAX’s #2 stock, Elliott Wave International’s September 2018 Global Market Perspective warned that, once the extreme optimism surrounding the fintech sector reached a peak, the mania’s “soaring valuations and ever-accelerating growth forecasts” would reverse and the entire industry would experience a “a catastrophic sell-off.”

From there, Wirecard’s meteoric rise reversed with shares plunging 50% into March of 2019. Officials stepped in to stem the decline with an unprecedented single-stock ban on short selling.

Elliott Wave International’s March 2019 Global Market Perspective foresaw the futility in such “Draconian measures” and showed this chart of Wirecard.

You can see that a five-wave rally into the 2018 peak was complete, marking a reversal in investor psychology — and the next move would see a “downward spiral.”

March 2019, Elliott Wave International’s Global Market Perspective:

“Catastrophic” was exactly how the media described the selloff that followed:

But as you can see, from an Elliott wave perspective and the independent analysis of Elliott Wave International’s Global Market Perspective, the writing was on the wall nearly TWO years before the June 2020 scandal.

The best part, our friends at Elliott Wave International have just alerted us to their July 23-30 Global Opportunities FreeWeek. This 7-day event invites you behind the paywall with instant access to their July 2020 Global Market Perspective — and other free forecasts for 50+ most-watched global markets.

To join Elliott Wave International’s Global Opportunities FreeWeek, all you need is a free Club EWI password. Take 30 seconds to get one now and on July 23-30, read their forecasts free. (No catch, and no credit card is required.)

If you’re already a free Club EWI member, simply click here for instant access to Global Opportunities FreeWeek.

This article was syndicated by Elliott Wave International and was originally published under the headline Wirecard Goes from $24 Billion to Bust: A “Wake-Up Call” Two Years in the Making. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Silver Begins Big Upside Rally Attempt

By TheTechnicalTraders 

– The move we saw in Silver early this week to new 6-year high price levels, above $22.60, is quite likely the biggest upside move in Silver since the bottom in March 2020 – after the US stock market collapsed because of the COVID-19 virus event. This new rally in Silver is likely the move we’ve been suggesting to our followers relating to a series of measured upside price moves totaling approximately $5.30 in each advance.

We wrote about these measured price moves in Gold and Silver in this article – Click Here

As traders, watching bonds accelerate moderately higher as the US Dollar falls and the stock market attempts new lofty levels, we are intrigued by the move in metals because it suggests a large segment of investors believe a bubble is nearing very peak valuation levels. The only reason metals, particularly Silver, would be accelerating as it has recently is that traders have suddenly adopted a stronger demand for second-stage hedging of risk.

Gold is the traditional hedge for many traders in times of risk.  Silver, being the second-tier hedge, typically start to rally 4 to 6+ months after Gold begins to move substantially higher.  Gold is currently trading near all-time highs – near $1820. Silver just recently bottomed in March 2020 near $11.65 and has rallied more than 70% to current levels – above $20.35.  If our research is correct, Silver will rally to levels above $26 within this current upside rally.

The multiple measured moves in Gold and Silver suggest waves of price advances happen in a series of structured upside price moves.  We believe this current upside move in Silver will push price levels above $26 per ounce.  If Gold continues to rally as Silver rallies, then future measured moves should target $31.50 and $36.75 in Silver – possibly higher.

I recently talked about silver specifically in both of these videos. The detail of what to expect and timing of the breakout is explained in layman terms and both short term traders and long term investors will benefit. No matter if you like miner stocks or if you buy physical metals, there are two videos you should watch/listen to.

 

Recently, Gold has move moderately higher while Silver has really started to accelerated more dramatically.  The move in Gold, compared to Silver, is like to push to levels above $1950 fairly quickly as the risks to the credit/debt and stock markets become more evident over time.

The Gold to Silver ratio is currently at 89.1.  It peaked in March 2020 at 126.6.  Historically, after a peak in this ratio is established at a time when the global stock market enters a period of contraction or extreme risk.  From the peak in the Gold to Silver ration in late 2008, the ratio contracted over 63% to bottom in mid-2011.  That bottom in the ratio was very close to the peak in Gold and Silver price levels.

Before you continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

If a similar type of price decline happens in the Gold to Silver ratio, it should fall to levels near 47.5 from the current level near 90.  This represents a substantial drop in the ratio level – which translates into a continued rally in both Gold and Silver until a peak syncing of price between Gold and Silver is reached.  Once the Gold to Silver ratio contracts below 60, it is likely that both Gold and Silver will begin to rally in similar price ranges.  That will be a very exciting time to watch for gold and silver bugs because both Gold and Silver could rally 8% to 15% each week (or more).

Once Gold reached the $1950 level, the next measured move target, subsequent target levels are $2200, then $2450.  Remember, traders, move into metals to hedge against risks they perceive in the stock, credit markets, and global economy.  At this point, we have to believe traders are pumping capital in Silver as Gold nears recent all-time highs.  We can’t ignore the fact that traders are actively hedging unknown risks in the markets aggressively in metals.

In fact, if you consider what the US Fed, global central banks and governments have attempted to accomplish over the past 6+ months and what has happened in Gold and Silver over the past 3+ years, it suggests traders have been actively hedging against market risks for over 2+ years.  They are more aggressively hedging right now – which suggests there is a very strong fear that the markets are trading on borrowed-time near these current high price levels.

Our passive investor signal newsletter which tells you when to own stocks, bonds, and metals has been long gold since it started a new bull market of July 2019. We have since added large-cap gold miners which have also started a bull market this year. Silver, well it’s just getting started, better late, than never!

We’ve continued to urge traders to stay cautious over the past 12+ months because of the risks identified by our proprietary modeling systems and our super-cycle research. Right now, we believe the risks of a major contraction in the US and global markets are still rather high.  The new highs in the NASDAQ are evidence of a DOT COM-like disconnect in the markets.  The US stock market is not rallying in a healthy manner – certain segments are rallying because they are still generating profits while the COVID-19 virus blows holes throughout the global economy.

Pay attention to what is happening in Gold and Silver because they are screaming “risk is excessive throughout the world” and traders that are chasing the rally in the US stock market could wake up to a very sudden surprise soon.

Get our Active ETF Swing Trade Signals or if you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Passive Long-Term ETF Investing Signals which we are about to issue a new signal for subscribers.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

NOTICE: Our free research does not constitute a trade recommendation or solicitation for our readers to take any action regarding this research.  It is provided for educational purposes only.  Our research team produces these research articles to share information with our followers/readers in an effort to try to keep you well informed.

TheTechnicalTraders.com

 

Energy Sets Up Near Major Resistance – Breakdown Pending

By TheTechnicalTraders

Our research team believes Crude Oil and Energy, in general, has stalled near major resistance and maybe setting up a big downside move as the COVID-19 virus continues to roil regional and global economies.

The recent news that the COVID-19 virus cases have skyrocketed suggests further economic shutdowns may push oil prices below $35 ppb over the next few weeks and months.  Our researchers believe Oil has already set up a resistance level near $42 and will begin to move lower as concerns about the economic recovery transition through expectations related to oil demand going forward.  We believe the renewed global economic demand for oil will present a very real possibility that oil could collapse below $35 ppb over the next 30 days.

We believe this pending downside move in Crude Oil will set up a great trade opportunity in ERY, the Direxion Bear Energy 2x ETF.  At this point in time, we are just waiting for the technical confirmation of this trade trigger.  Once we receive confirmation from our price modeling systems, we believe ERY may rally 20% to 30% or more from current levels.

Before you continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

Our research team believes Crude Oil’s inability to rally above $42 recently suggests strong resistance exists near the $42 level. There could be a short squeeze in price where oil pops to $44-45 and then reverses quickly below $41, which would be a great sell signal for falling oil.

We believe Q3 will present a very real opportunity for oil to fall below $35 ppb over the next few weeks.  Possibly moving much lower – below $30 ppb.  Once this move confirms, we’ll have the opportunity to jump into the ERY trade where we may attempt to capture 20% or more on a quick technical trade.

Our proprietary Fibonacci Price Modeling system is suggesting an initial upside price target for ERY near $68.  This suggests a potential 35% upside price move in ERY is Crude Oil Collapses as we expect.  This presents an excellent trading opportunity for skilled technical traders.

As we wait for Crude Oil to breakdown, traders should watch the GAP below $48 as a potential deep price support level in ERY.  The upside potential profits for this trade is still rather substantial.  We just need to wait for the proper technical confirmation for this setup because news or any geopolitical events could dramatically change expectations for Crude oil.

Get our Active ETF Swing Trade Signals or if you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Passive Long-Term ETF Investing Signals which we are about to issue a new signal for subscribers.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

NOTICE: Our free research does not constitute a trade recommendation or solicitation for our readers to take any action regarding this research.  It is provided for educational purposes only.  Our research team produces these research articles to share information with our followers/readers in an effort to try to keep you well informed.

TheTechnicalTraders.com

56% of investors say sustainable investments (ESG) are a new safe-haven

By George Prior

– Sustainable and responsible investments (ESG) are now regarded as ‘safe havens’ by the majority of investors, reveals one of the world’s largest independent financial advisory and fintech organizations.

deVere Group, which operates in more than 100 countries globally, reports that 56% of clients who seek to include environmental, social and governance-orientated investments into their portfolios do so citing that such sustainable funds offer financial protection in times of uncertainty.

A safe-haven asset is a financial instrument that is expected to retain, or even gain value during periods of economic downturn.

Nigel Green, deVere Group’s CEO and founder, says: “There’s been a massive surge from clients this year looking for ESG investments.

“Indeed, more than a quarter of all clients are currently considering or are already actively engaged in responsible, impactful and sustainable investing.

“It’s a phenomenon that’s particularly prevalent with millennials, with eight out of 10 putting ESG credentials at the heart of their investment decision-making process.”

He continues: “However, what is perhaps particularly interesting are the reasons why investors are seeking ESG in the first place.

“Of course, the global public health crisis has acted as a wake-up call in many respects. It has prompted a growing collective awareness of mutual responsibility that fits perfectly into the narrative of ESG investing.

“But what’s most surprising is that the majority [56%] also now say that they perceive ESG investments as the new safe-haven asset class.  As such, they are increasing their exposure to such funds in a way that traditionally they would have done with, say, gold or U.S. government bonds.”

Mr Green goes on to say: “They would be correct in citing this view. All the latest research underscores that the majority of environmental, social and governance investments have outperformed their non-sustainable counterparts this year and have had lower volatility.

“This cannot be ignored by retail – and increasingly institutional – investors who are looking for resilience in these highly unusual times of this new era.”

Previously, the deVere CEO has commented that the trend for ESG is only likely to intensify as millennials, who are statistically more likely to seek responsible investment options, become the major beneficiaries of the largest intergenerational transfer of wealth – an estimated $30tn in the next few years – meaning we can expect both retail and institutional investors to continue to pile into ESG.

Nigel Green concludes: “The data shows that the view held by traditionalists who claim ESG investments are ‘nice to have’ but not ‘a need to have,’ falls apart under scrutiny in the virus-driven global economic downturn.

“And whilst this short time frame is not determinative, those investors citing ESG’s safe-haven credentials are, for now at least, being proven right.”

About:

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.  It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.

Top Software Picks for Day Trading

Day trading’s popularity has surged in the past couple of decades. High-speed internet connections and access to personal computers made day trading an attainable possibility. Today, the potential to earn money and work full-time executing trades is an exciting possibility.

However, as any skilled day trader will tell you, day trading isn’t for everyone. It’s often aggressive, fast-paced, and requires an enormous amount of skill and strategy. Additionally, to be successful, you must have a comprehensive, intuitive, and powerful software.

Many new day traders mistakenly think they aren’t good at day trading when the problem isn’t their ability – it’s their software’s shortcomings causing them to fall short.

So, what are the top software picks for day traders? Let’s get into it.

Day Trading Software

Choosing the Right Software

When you first start learning how to day trade, you might not have your strategy figured out yet. Not knowing what you need can make finding the right software even more challenging.

If you’re just getting started, there are a few specific things you want your software to have:

  • Responsive and Up-To-Date Research
  • An Affordable Minimum Balance
  • Low Fees and Commissions
  • Mobile-Friendly
  • Comprehensive Analytics
  • Fast Execution Time
  • Market Scanning Capabilities
  • Portfolio Tracking
  • User-Friendly Charting Software

If your software has all of the above features, you’ve likely found a winner. However, your needs might be more complicated. If you plan to utilize complex algorithms, you might find that you need a localized computer-based software. You might also really benefit from additional features like backtesting, news coverage, and more.

Start with the must-have features, and then look for software solutions that also include your unique needs. The perfect software for you exists, you just have to find it.

Now, what are some of the software solutions on the market that fit the bill? Let’s dive into some of the top choices.

Five Top Day Trading Software

  1. LightSpeed – LightSpeed offers a free demo account for users. This allows you to learn how to trade with zero risks. Pair that with their low latency and fast execution speeds, and it’s clear why they’re a top pick. They also have incredibly low commissions, which is essential for active day traders. Once you get your feet wet, customization is a breeze.
  2. TradeStation – TradeStation has been in the game since 1982. They’re true innovators in the trading software world. They offer commission-free stock trades, one-click trading, comprehensive research, and completely customizable software. They’re also praised for their top-tier customer service.
  3. Interactive Brokers – Interactive Brokers is the trading software developed specifically for day trading. Because of this, it’s incredibly intuitive to the needs of day traders. They can be costly, though. Most experts say that Interactive Brokers is the best software for day traders, but only if you know exactly what you’re doing. If you’re brand new to day trading, you’d likely fare better learning the ropes with different software and then switching to this one later on.
  4. TD Ameritrade (ThinkorSwim) – Unlike Interactive Brokers, ThinkorSwim is a terrific software to learn the ropes. It offers research and tools, educational resources, mobile trading, and hotkeys. Additionally, it has nearly every single feature you could ever need. Some say that there are almost too many features, which can make it overwhelming to a new trader. However, with their tools and easy-to-use interface, it’s a fantastic place to develop your strategy and style.
  5. TradeSpoon – TradeSpoon’s beginner option is free, so it’s an ideal place to start without having to pay a fortune. The interface and usability are intuitive and dynamic. They offer a wide range of interesting tools, like their sock forecast toolbox. However, what really sets TradeSpoon apart is their one-on-one mentoring options. If you like learning via a teacher or mentor, TradeSpoon has mentors available to help you learn the ropes, which can make the transition into day trading much smoother.

Five Top Day Trading Software

Selecting Your Software

Ultimately, your perfect software will depend a lot on your unique needs. However, if you look for software that includes the must-have features, you’ll be ahead of the curve. Always read the fine print on fees, check out reviews, and do additional research before committing to any software.

Finally, know that no matter what software you choose to go with, you’ll have a bit of learning to do. Learning how to successfully day trade takes a lot of work, and fantastic software is just one piece of the puzzle.

About the Author:

Skylar Hammond is a writer for the True Trader group who specializes in topics such as stock trading, personal finance, and forex. He focuses on helping beginners and experts alike learn more about the market and improve their trading skills.

 

Protracted G7 contraction – or multiyear global depression

By Dan Steinbock

 – Global growth prospects are deteriorating. Instead of a V-shaped recovery in the 2nd quarter, advanced economies will face historical carnage and a prolonged contraction. But there’s still worse ahead.

Current estimates for major advanced economies remain too optimistic, due to the mismanagement of the COVID-19, belated responses and premature exits, which have now caused far-earlier-than-expected secondary virus waves. As a result, the hoped-for V-shaped recovery will not happen in the 2nd quarter.

The Trump administration’s catastrophic COVID-19 failures, along with premature exits to reopen the economy and leave the WHO will virtually ensure still new virus waves and longer contraction. In turn, US tariff wars are undermining the promise of the Asian Century.

2nd quarter carnage: projections and realities

In early February, as new coronavirus cases began to decelerate in China but accelerate outside China, I predicted that China would rebound in the 2nd quarter but major advanced economies could rebound in the 3rd quarter only if they’d manage to contain the pandemic.

At the time, this view was seen as too optimistic for China and too pessimistic for advanced economies.

When the deceleration of new cases in China continued in March, but dramatically accelerated in major advanced economies, I projected that China’s rebound in the 2nd quarter would be stronger than expected. And that major advanced economies, particularly the US, would face a contraction that would be at par with or worse than the Great Depression.

At the time, this view was seen as too optimistic for China and too pessimistic for advanced economies.

In late January, President Trump congratulated President Xi Jinping for China’s success in the virus containment. In March I predicted that Trump would reverse his words. Due to plunging ratings and re-election challenges, I projected that Trump and his administration would blame China for COVID-19, particularly in early summer ahead of the 2nd quarter results in the US.

Today, we know that Chinese economy became the first to rebound in the 2nd quarter, by growth of 3.2%. In contrast, major advanced economies are heading toward a historical plunge in the 2nd quarter. And as projected, Trump’s attacks against China intensified in June and have accelerated into a kind of hybrid war.

And there’s worse ahead.

Economic erosion in G7, rebound in China

Until recently, many international observers expected US to benefit from a strong rebound that would start in late spring and strengthen in the 3rd quarter. New virus waves were seen as a possible threat but later in the fall. The Trump administration’s pandemic mismanagement and premature exits have undermined those hopes and resulted in a huge virus resurgence in the US; months earlier than anticipated.

While consensus models expected US coronavirus cases to be around 3 million by now, they will exceed 4 million soon. So, the 2rd quarter contraction, which was expected to amount to -33%, is likely to soar to -53%, according to the Atlanta Fed. Annualized growth will take a deeper hit, accordingly.

In the UK, Boris Johnson’s government followed in the US footprints until realities proved overwhelming. While the government has taken a different stance since late spring, it has been too little too late. Coronavirus cases are about to exceed 300,000. In the 2nd quarter, British economy could plunge by -20% to -25%.

Although Italy was the first major economy in the Euro area to suffer from the pandemic, its stringent quarantine measures reduced the damage in the spring. Nonetheless, the virus cases amount to almost 245,000 and the 2rd quarter is expected to translate to a plunge of -9% to -10%.

As the Euro area’s strongest economy, Germany is no longer immune to contraction either. As German cases are about to exceed 200,000, the country could experience a plunge of -8% to -10% in the 2nd quarter.

France is following in Germany’s footprints. Officially, the cases are about to exceed 175,000. Yet, the 2nd quarter will prove dire with a plunge of -17%.

While COVID-19 has recently surged in Japan, official cases average at about 25,000, while annualized growth is likely to plunge to -5%. But official virus data cannot be taken at face value because minimal testing. Until recently, the country’s testing capacity, as adjusted to population, has been significantly behind that of Uganda, half of that in the Philippines and less than 2.5% relative to the UK.

Chinese cases have stayed below 85,000, as I predicted three months ago. As long as China can deter imported infections, the rebound will prevail. The challenge will be the Trump administration’s hybrid war, which seeks to derail China’s return to pre-crisis economic growth, while risking global economic prospects for years to come.

Protracted contraction or global depression

A review of official coronavirus cases and discrepancies between expected and likely quarterly results suggests trends that will cause increasing distress in major advanced economies. Not just in the next few months but in the medium-term, due to COVID-19 mismanagement, belated responses and premature exits.

Here’s why:

  • Instead of the hoped-for V-shaped economic rebound in the 2ndquarter, no major advanced economy will deliver such performance.
  • In the US, Latin America and some other economies, where containment failures, belated responses and premature exits have proved significant, secondary waves will prolong the pandemic pain and collateral economic damage. Yet, current estimates do not reflect these outcomes, which markets still undervalue. Worse, as restrictions expire, US infections are likely to migrate elsewhere in the world.
  • If advanced economies continue to mismanage the pandemic crisis and persist in premature exits, they will face a protracted L-shaped recovery, which could evolve into a multiyear global depression in the early 2020s.
  • Major advanced economies are coping with their historical plunge by taking more debt, Ironically, the medication against COVID-19 is paving the way for soaring budget deficits. As old fiscal packages prove inadequate, new ones will be launched, which will contribute to new debt crises and risk defaults.
  • In the past months, fiscal stimuli have been coupled with aggressive monetary easing; that is, the return to ultra-low rates and large asset purchases, which will prevail significantly longer than currently acknowledged, with attendant longer-term collateral damage.

The US quest to push for tariff wars, even amid the worst contraction in a century, is now undermining efforts to promote world trade, investment and migration, which the G20 economies used in 2008 to avoid global depression.

The net effect – unwarranted de-globalization – will endanger global recovery, deepen economic challenges and contribute to potentially fatal geopolitical crises.

It’s time to tighten the belts; we’re in for a new rollercoaster ride. That’s what happens when science-based public-health policies are systematically ignored for political exigencies. Pandemics gain, economies lose, and people will suffer.

About the Author:

Dr. Dan Steinbock is an internationally recognized strategist of the multipolar world and the founder of Difference Group. He has served at the India, China and America Institute (USA), Shanghai Institutes for International Studies (China) and the EU Center (Singapore). For more, see https://www.differencegroup.net/ 

Based on Dr Steinbock’s global briefing on July 17, 2020

 

US Stock Market Stalls Near A Double Peak

By TheTechnicalTraders 

– The US stock market stalled early this week as earnings started to hit.  A number of news and other items are pending with earnings just starting to roll in.  There have been some big numbers posted from JP Morgan and Goldman Sachs.   Yet, the markets have reacted rather muted to these blowout revenues.

We believe this is a technical “Double Top” set up in the making.  The NASDAQ has been much weaker than the S&P and the Dow Industrials.  We believe the US stock market is reacting to the reality of earnings and forward guidance after the recent rally in price levels over the past 9+ weeks.  If we are correct and this Double-Top pushes price levels lower, then this technical resistance level may become the price ceiling headed into Q3 and Q4 2020.

Before you continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

E-mini S&P 500, Weekly chart

his ES, E-mini S&P, Weekly chart highlights the technical Double Top pattern that we believe will become a major price ceiling as earnings and other economic data continues to be released.  This is a perfect example of how technical patterns align with fundamental data to present very clear trading signals.  If the resistance near 3220 holds as we expect, the ES price level should begin to move lower attempting to target the 3000 level.

SPY ETF Weekly Chart

This SPY ETF Weekly chart highlights the similar Double-Top pattern that has setup with further indicates strong resistance near $322 – which aligns with the original Fibonacci Bearish Trigger Level from the February peak levels (the solid RED line).  The Double-Top setup near the Fibonacci Bearish Trigger level suggests a very strong resistance level that exists near $322.  It is our opinion that this Double-Top setup near strong resistance will likely push the SPY into a downside price trend targeting $300 or lower.

Transportation Index Weekly Chart

This Transportation Index Weekly chart highlights a different type of resistance price pattern – a downward sloping price channel peak.  Unlike a Double-Top pattern, when price creates unique high price peaks that align into a price channel, we can attempt to use this channel as a price resistance channel going forward.  In this case, the peak price level in February 2020 and the peak price level in June 2020 creates a very clear downward price channel that matches the current price peak perfectly.

It is our opinion that this peak level will act as strong price resistance in the Transportation Index and should prompt a downside price trend targeting $8900 to $9000 or lower.

As global traders and investors continue to trade the forward expectations and earnings data that will last another 4+ weeks, we have to be prepared, as skilled technical traders, to trade any decent price moves that initiate as a result of price reacting to this technical resistance and moving lower.  As technical traders, we will wait for confirmation of a trading signal before jumping into a trade from these levels.  This makes a big difference in terms of accuracy.  Once we receive a confirmation of the technical pattern, we believe the trade has a much higher accuracy ratio.

In closing, be prepared for bigger downside price trends as this technical resistance works through the markets. After the peak in June 2020 and the setup of this Double-Top pattern, our researcher team believes a downside price move from current levels is highly likely.

Get our Active ETF Swing Trade Signals or if you have any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Passive Long-Term ETF Investing Signals which we are about to issue a new signal for subscribers.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

NOTICE: Our free research does not constitute a trade recommendation or solicitation for our readers to take any action regarding this research.  It is provided for educational purposes only.  Our research team produces these research articles to share information with our followers/readers in an effort to try to keep you well informed.

TheTechnicalTraders.com