Hello fellow traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Friday, the 10th of February.
The Bear Bites Back!
After six weeks of uninterrupted weekly gains in the equity markets, the bear bites back.
Is demand for gold on the wane, as sentiment towards stocks comes alive?
With Valentine's Day just around the corner, has the demand for gold diminished? We will take an in-depth look at the gold market today.
3 Stocks on the move today:
NOBLE (NE), XL GROUP PLC (XL), and FIRST SOLAR (FSLR).
Did MarketClub's Trade Triangle technology get it right on these three stocks?
Trading Tip:
DON'T FIGHT THE MARKET … MOVE WITH THE MARKET
Now, let's analyze the charts with MarketClub's Trade Triangle Technology.
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S&P 500 INDEX
BIG PICTURE: Strong Trend +90
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bullish | Short-Term = Bullish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
The S&P 500 index should begin to find support beginning at $1330 and extending down to the $1320 area. Our next target zone for this index is $1360 and we would not be surprised to see this level reached early next week. Longer-term we expect this market to move up to the $1550 to $1600 level by late May or early June based on our cyclic work. With all three of our Trade Triangles green, a bull market is underway. Long and Intermediate term traders should now be holding long positions in this index with appropriate money management stops.
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Watch today’s S&P 500 Video Here.
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Suggested S&P 500 Trading Instruments:
Non Leveraged ETF’s: (Long SPY) (Short SH)
2 x Leveraged ETF’s: (Long SSO)(Short SDS)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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Something BIG is coming in 47 days!
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SILVER (SPOT)
BIG PICTURE: Emerging Trend +70
TRADE TRIANGLES: Long-Term = Bearish | Intermediate Term = Bullish | Short-Term = Bullish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
A close in the silver market at $33.65 would create a Doji line on the weekly chart. This would be further evidence that this market is meeting resistance and topping out. The silver market continues to oscillate between support at $33 an ounce and resistance at just over the $34.50 level. We think this market is at the top of a trading cycle, but has not provided conclusive proof that the cycle has topped out. With our long-term monthly Trade Triangle in a red negative mode, we expect to see this market run out of steam around current levels. This particular indicator has done extremely well in the past. Long-term term traders should be in short positions in silver with appropriate money management stops. Intermediate term traders should be on the sidelines.
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Watch today’s Silver Video Here.
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Suggested SILVER Trading Instruments:
Non Leveraged ETF’s: (Long SLV) (Short the ETF SLV)
Leveraged ETF’s: (Long AGQ) (Short ZSL)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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GOLD (SPOT)
BIG PICTURE: Trading Range +55
TRADE TRIANGLES: Long-Term = Bearish | Intermediate Term = Bullish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
A close this week around the $1720 level will be the second weekly loss we have seen in gold and further evidence that the cycle is topping out. The choppy action in gold continues as we see this market moving between the $1760 level on the upside and the $1710 area on the downside. With a Score of +55, this market is in a trading range. We would not be surprised to see gold on the defense until the middle of May. With our long-term monthly Trade Triangle still red, we cannot get to excited about this market at the moment. That does not mean that we are super bearish on this metal, we need further confirmation with the tools we know are successful in trading gold. Long-term term traders should be in short positions in gold with appropriate money management stops. Intermediate term traders should be on the sidelines.
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Watch today’s Gold Video Here.
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Suggested GOLD Trading Instruments:
Non Leveraged ETF’s: (Long GLD) (Short the ETF GLD)
Leveraged ETF’s:(Long UGL) (Short GLL)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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COPPER (MAY)
BIG PICTURE: Strong Trend +90
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bullish | Short-Term = Bullish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
ATTENTION: We are now tracking the MAY copper contract. Today's sharp drop in copper pulls this market back into a support area. We expect the $3.80 area to be a very good support for this market, as we continue to view the longer-term trend in copper as positive. With a Score of +90, we are in a strong trend to the upside and continue to be positive on this market. As we have said in the past, copper generally reflects economic conditions, and as such is influenced by equity prices. Look for support at the $3.85 level. The market action looks as though it has created a large base to move higher in the future. Long and Intermediate term traders should now be holding long positions in this index with appropriate money management stops.
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Watch today’s Copper Video Here.
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Suggested Copper Trading Instruments:
Non Leveraged ETF’s: (Long JJC)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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CRUDE OIL (APRIL)
BIG PICTURE: Trading Range +55
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bearish | Short-Term = Bullish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
ATTENTION: We are now tracking the APRIL crude oil contract. We are looking for this market to be on the defensive for the next couple of days, but then expect it to regroup and start moving higher once again. We are looking for crude oil to make it's highs probably somewhere in the May period. Once over $102 a barrel, this market should skyrocket. We want to pay close attention to this market as we believe that the recent market action is reflecting an important cyclic low period for this market. If this is true, this market could be headed substantially higher. With a Score of +55, this market we remain in a trading range. We remain longer term positive on this market. With our monthly and daily Trade Triangles in a positive mode, we expect we will see further market consolidation in crude oil. Long-term traders should be long this market with appropriate money management stops.
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Watch today’s Crude Oil Video Here.
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Suggested Crude Oil Trading Instruments:
Non Leveraged ETF’s: (Long USO) (Short the ETF USO)
Leveraged ETF’s: (Long UCO) (Short DTO)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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Join us in 47 days for something you can't afford miss
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DOLLAR INDEX
BIG PICTURE: Emerging Trend -70
TRADE TRIANGLES: Long-Term = Bullish | Intermediate Term = Bearish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
The dollar index is showing a bullish divergence on the Williams% R indicator. This means the price moved lower, but the momentum did not. This usually indicates that a reversal is at hand. The dollar index pushed to new lows and came closer to the 50% Fibonacci retracement level we've been discussing in our previous posts. This market is not out of the woods yet, however the longer-term Trade Triangle does warrant some caution at the moment. We are waiting for this market to hit some of the Fibonacci levels we've outlined, and will see how it acts at those levels. Only our longer-term monthly Trade Triangle remains positive on this market. With a Score of -70, this market is in an emerging trend. We expect we will be seeing some of the Fibonacci retracement levels of $78.29 and $77.46 come into play. These represent 50% and 61.8% Fibonacci retracements. Long term traders using our monthly Trade Triangle should maintain long positions with appropriate stops in place.
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Watch today’s Dollar Index Video Here.
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Suggested DOLLAR INDEX Trading Instruments:
Non Leveraged ETF’s: (Long UUP) (Short UDN)
Leveraged ETF’s: (Long) (Short)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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REUTERS/JEFFERIES CRB COMMODITY INDEX
BIG PICTURE: Emerging Trend -75
TRADE TRIANGLES: Long-Term = Bearish | Intermediate Term = Bullish | Short-Term = Bearish
MARKETCLUB SCORING SYSTEM: Trading Range 50 – 65 | Emerging Trend 70 – 80 | Strong Trend 85 – 100
For the second week in a row, it looks as though the index is going to close lower for the week. It remains in a broad trading range bound by $320 on the upside and $310 on the downside. With a Score of -75, this market is trying to develop into an emerging down trend. Our short term daily Trade Triangle has turned red indicating short term weakness, and our longer-term monthly Trade Triangle remains red and negative on this market. Long-term traders should hold short positions in this index with appropriate money management stops.
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Watch today’s REUTERS/JEFFERIES CRB COMMODITY INDEX Video Here.
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Suggested REUTERS/JEFFERIES CRB COMMODITY INDEX Trading Instruments:
Non Leveraged ETF’s: (Long CRBQ) (Short the ETF CRBQ)
Leveraged ETF’s: (Long) (Short CMD)
Futures & Options: Contracts are available to trade this market. Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.
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Something BIG is coming in 47 days!
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This is Adam Hewison for MarketClub and I'll see you tomorrow with my weekend update. Have a profitable trading day.
Take care everyone,
Adam Hewison
President INO.com and co-founder of MarketClub.com
Hi Adam- I still struggle with reacting fast enough to the trade triangles...and I have paid for it...big. Partly because I get fearful that the triangle is wrong. For example, in your video today the Green monthly triangle actually occurred later than you mention (but at 37.93), the trend turned down, and then the Red weekly came in close to 33'ish. If I bought on the monthly, then I would have lost $3.90'ish, and probably would not have hung around long enough to buy the green weekly, which came in at 32'ish, now trading 39'ish. This would have been a net $3 or 9% gain. So, my point is that you really need to stick to certain stocks, and accept the losses....which I have a hard time doing. I would be really curious if you would be able to run some sort of statistics on an array of stocks and present the best performing historically against the triangles. This would be quite interesting for me, and hopefully profitable.
sorry, the actual number for the red weekly was 34, to get the $3.90 loss
Hi Adam, thank you for the great presentation today. I appreciate your examples showing how to use the trade triangles. I have now set up alerts for two positions when the appropriate triangle appears. I have the alert set for a week. Would it be better to set it for once a day? Would love your continuing to give us more examples of entrances and exits using the trade triangles. Wow, this was great.
Adam,
If I follow just the triangles to get in and out, do I really need Vin Scully's PMI service?
I sort of expect some pretty wild swings around the Greece and EU news - this slow motion train wreck is finally reaching the end of the kickable-can road.
You'll see flight to safety so those things go up for awhile - then back down - but PM's sold off to meet margin calls - or bought for safety, all sorts of odd dislocations that a nimble trader might take advantage of, if right about the order things happen in, or maybe just lucky. No time for the weak of heart!
It going to be a time to trade like a cowboy, or reduce exposure and cower behind the couch, your choice.