Stocks, ETFs, Options, Commodities & Currencies

Important Japanese Candlestick Reversal Patterns

The Doji Star and Shooting Star Japanese Candlestick patterns are part of a unique group that identifies potential price reversals, support/resistance and can often build into other types of patterns. Our belief is these setups in the current chart will eventually create an Evening Star formation with a downside price move early next week. This type of pattern would confirm resistance near the body of the current Doji or Shooting Star candlestick and also confirm our analysis that a price breakdown should continue.


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Recent news suggests that oil producers are attempting to increase production levels after failing to attempt to push prices higher by cutting production levels. Globally, oil producers want to see oil prices rise above $65 ppb in an effort to support profit and production cost expectations. The real issue for the nation/states that rely on oil production/sales is that the global economy may not cooperate with their expectations over the next 24+ months.

Crude Oil Daily Chart Analysis

Our researchers believe Crude Oil could become very volatile as price nears the apex of the Pennant/Flag formation that is setting up. This Daily chart highlights the attempted “scouting party” price rotation above the price resistance channel. The news over the past holiday weekend suggests the global economy may not see any real bump in activity over the next 12+ months and we believe this aligns with our longer-term research that Oil should target the sub $40 price level before the end of 2019 and potentially fall to levels below $30 in early 2020.

Crude Oil Weekly Chart Analysis

We believe the key to all of this price rotation is the $50.50 level and what price does over the next 30 to 60+ days. There is a potential that price may attempt a brief upside move over this span of time, but the true intent of price is to move lower based on our ADL price modeling system. Therefore, we believe the downside potential is the most opportunistic for traders. The next price target based on our Fibonacci bearish price trigger level is the $45 price range.

CONCLUDING THOUGHTS:

This move could take place quickly, over the next 2 to 3 weeks on a breakdown move, or over many months. Watch the $50.50 level as that is the key. If the price falls to any level below $50.50, then we could be moving towards the $45 level or even the $40 on a big move related to global economic expectations. Otherwise, expect the price to move towards the $50.50 level over the next few weeks as this support level is key to all future moves.

As we wait for the next leg to start to move prices lower, pay attention to any upside price activity as that may present a very clear entry point for skilled technical traders.

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Crude Oil has been trading in a fairly narrow range since mid-August – between $52 and $57 ppb. Our Adaptive Dynamic Learning (ADL) predictive modeling system suggested the downside price move in late July/early August was expected and the current support aligns very well with our ADL predictions of higher price rotation throughout most of September/October.

We believe the current price highs, near $59 to $60, will likely continue as strong price resistance over the next 25+ trading days before a bigger breakdown begins near Mid-October. We expect the price to continue rotating within a fairly narrow range in alignment with our ADL predictions. Our original article suggested a high price target area near $60 from our ADL research. Now that Crude Oil has nearly reached this level, we believe the continued upside opportunity in Crude Oil is limited.

We don’t expect anything crazy to happen in Oil until later in September or into early October. Our ADL predictive modeling suggests that Crude Oil will peak in October and begin a broader downside move towards levels just below $50. Crude Oil may begin this move a bit earlier than our ADL system predicts because of news or some fundamental data related to oil demand/supply. It is not uncommon for the price to move towards the ADL predicted levels many weeks before or after our Monthly ADL predictions. When we create the Monthly ADL charts, the data represented is based on highly probable levels for the completed month. So, we know that near the month of October or November, Oil should be targeting the sub-$50 level.

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S&P 500 Index Trend & Trade Signals – Sept 30

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There are times when our research team interprets our advanced predictive modeling systems so well that we call a move in the markets 3 to 10+ months in advance of the move actually happening. It has happened for our team of research so often lately that we are somewhat used to the accolades we receive from our followers and members. Our October 2018 Gold price predictions are still playing out accurately and continue to amaze people – even though we made these predictions over 12 months ago.

Today, we wanted to highlight our Adaptive Dynamic Learning (ADL) predictive modeling systems expectations for Crude Oil, but before we get into the details be sure to opt-in to our free market trend signals newsletter. The research post we made on July 10, 2019 (see below). At that time, we warned that Crude Oil was about to head much lower and that our ADL modeling system was suggesting that Oil prices would rotate between $47 and $64 before breaking much lower in November 2019. Ultimately, Oil prices will fall below $40 ppb following our timeline and could begin a broader downside move before the end of October 2019. Read our full prediction/research report from the link below.



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After setting up a very deep price base in August 2019, Natural Gas has, again, moved back into the basing zone and ourhistorical price research still suggests October and November will be stronglypositive for Natural Gas. We believe the upside potential in Natural Gas could target $3.00 fairly quickly – possibly before mid-November 2019.

This Weekly Natural Gas chart highlights the “bump” in price that happened in September and how price has fallen back into the basing zone. It is almost as if the market forgot what Natural Gas should be doing, historically, at this time of the year. Well, who cares. If the markets are going to give us another chance at a +30% price rally – we’re not going to miss the opportunity to buy within the basing zone.

Our opinion is that any opportunity to buybelow $2.40 is an adequate entry level. Ideally, try to wait for levels below $2.30 if possible. This new basing zone pricing may not lastvery long, so try to take advantage of lower prices when possible. Ideally, the upside potential for this moveshould be fairly easy to target given the historical price patterns thatconsistently drive Natural Gas higher in October and November.


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October 8, 2019

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Many online brokers are cutting their trading commissions to zero. There are ways to benefit from this beyond just zero commissions. It is now better than ever to buy individual stocks as opposed to ETF’s when investing in a sector.

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Back in the day, for those of you that are old enough to remember and have experienced one of the most incredible trader psychology driven stock market decline in recent history.

The difference between “Black Monday” and most of the other recent stock market declines is that October 19, 1987, was driven by a true psychological panic, what we consider true price exploration, after an incredible price rally.

It is different than the DOT COM (2001) decline and vastly different than the Credit Market Crisis (2008-09) because both of those events were related to true fundamental and technical evaluations. In both of those instances, prices have been rising for quite some time, but the underlying fundamentals of the economics of the markets collapsed and the markets collapsed with future expectations.

Reagan, much like President Trump, was elected after a long period of US economic malaise and ushered in an economic boom-cycle that really began to accelerate near August 1983 – near the end of his first term. The expansion from the lows of 1982, near 102.20, to the highs of 1987, near 337.90, in the S&P 500 prompted an incredible rally in the US markets for all global investors.



This is very similar to what has happened since 2015/16 in the markets and particularly after the November 2016 elections when the S&P500 bottomed near 1807.5 and has recently set hew highs near 3026.20 – a 67.4% price rally in just over 3 years.

One can simply make the assumption that global investors poured capital in the US markets in 1983 to 1986 as the US markets entered a rally mode just like we suspect global investors have poured capital into the US markets after the 2016 US elections and have continued to seek value, safety, and returns in the US markets since. These incredible price rallies setup a very real potential for “true price exploration” when investors suddenly realize valuations may be out of control.

So, what actually happened on October 19^th,1987 that was different than the last few market collapse events and why is itso similar to what is happening today?

On October 19, 1987, a different set of circumstances took place. This was almost a perfect storm of sorts for the markets. The US markets had risen nearly 44% by August 1987 from the previous yearly close – a huge rally had taken place. Computer trading, which some people suspected may have been a reason for the price decline on October 19, was largely in its infancy.

Floor traders were running the show in New York and Chicago. The London markets closed early the Friday, October 16, because of a weather event that was taking place. The “setup” of these events may have played a roll in the liquidity issues that became evident on Black Monday and pushed the US markets down 22.61% by the end of trading.

The US markets had set up a top near 2,722 in early August 1987 after rising nearly 44% from the 1986 end of year closing price level of 1,895. The SPX rotated lower from this peak to set up a sideways price channel near 315 throughout the end of August and through most of September. On October 5, 1987, the SPX started a downward price move that attempted to test the lower support channel near 312. On October 12, one week later, the SPX broke below this support channel and closed at 298.10 (below the psychological 300 level). The very next weekend was October 17 & 18 – the weekend before Black Monday.

Sunday night, October 18, in the US, the Asian markets opened for trading and a price sell-off began taking place in Hong Kong. Because the London markets has closed early on the 16^th due to the storm, by the time they opened the UK markets began tanking almost immediately. Early in the day on Monday, October 19, the FTSE100 had collapsed over 136 points.

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Our research team has been attempting to answer the question that seems to be on everyone’s minds right now – are we setting up another Black Monday type of event in the global markets and what should traders/investors know before the event potentially takes place. Our research team has spent the past few weeks trying to better understand the global economic events that took place 8 to 20+ years before the Black Monday event happened and have been particularly interested in the 10+ years just before the Black Monday event. Additionally, we’ll focus on the recovery event that took place after the Black Monday collapse completed.

In Part I of this article, we attempted to highlight some of the similarities of today’s global economic world to the scenario in the early 1980s. Many of you may not be old enough to remember the 1960s or 1970s, but at least one individual on our research team is old enough and was actively trading in 1985. His interpretation of the economic events prior to the 1987 Black Monday collapse and how they may be similar to today highlight some very interesting facets for our readers.

The late 1970s was a period where most Americans worked hard, tried to play by the rules and struggled to attempt to get ahead in a world that seemed to be a little out of order. The 1960s was a period of awakening in America where music, culture, and people shifted away from the WWII era and post-WWII era thinking. Vietnam, Korea and a host of other issues, as well as rising US interest rates, presented very real problems for many Americans. By the time the US entered the 1980s, Americans had already experienced the assassination of John F. Kennedy, the race to the moon, multiple wars, victories and defeats, a cultural shift to near the extremes and another shift moving our culture back closer to center, Oil/energy crisis events, a moderate malaise of economic prosperity, and continually higher US interest rates. Then the US elected Ronald Reagan.

It seemed to everyone that Ronald Reagan had unlocked secrets to the American opportunity that had been somewhat lost over the previous few decades. In reality, the first 2 to 3 years of the Reagan Presidency resulted in very mixed economic results – almost identical to President Carter’s. The biggest identifying factor that our research team found was that the US Federal Reserve altered its rate policy in the early Reagan years from a “raising stance” to a “declining stance”. Throughout Carter’s term, the FFR rate change averaged +2.08. Throughout the first four years under Reagan’s term, the FFR rate change averaged -0.7825. By 1984, the US Federal Reserve had lowered rates, twice, by an average of over 7% after raising rates every year since 1977.


(source: https://einvestingforbeginners.com/u...rowth-history/)

Is this similar to what is happening today? The US Federal Reserve began raising rates in December 2015 and continued to raise rates until August 2019 – nearly 3.7 years of rate increases after nearly a decade of near-zero interest rates prior to 2016.

Another interesting facet is what our research team calls the “capital shift” that has taken place since just before 2015 – where foreign capital has poured into the US stock market and asset markets for safety, security, and returns. Prior to the point where capital controls were instigated in China (in 2015), a moderate capital shift event was already taking place. Once China installed these new capital controls, attempting to prevent capital from fleeing their local economy, a broader shift took place where the US markets began to rally and where foreign capital was more actively attracted to the US stock/asset markets because of the strength of the US Dollar and the continued rally in the US stock market. This is similar to what happened in 1983 through 1987.

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