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Gold Trader

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USO USD RSI

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Cumulative Money Flow

Good morning Traders,
 
Back in 2005, Mark McMillan joined us writing an ETF Trading Service.  The service comes with access to his personal chat room.  For the past two years, we’ve closed the service to new subscribers, but as he approaches his 10 year anniversary with us this June, we’re opening it back up to let new subscribers in.  One of the reasons is that we see a significant correction developing in the markets – and we want to make our most experienced advisors available to you to help you through it.  This condition doesn’t happen all that often in history, and I’ll walk through it below. 
 
 
So what do we see?
 
Dow 1929 - Subscribe Now
In this first chart, we see a LPPL Curve of the DOW JONES approaching the 1929 top.   This Log Periodic Power Law curve is a formulation that fits when you get a series of higher highs and higher lows and cycles and depth diminishing in time. 
 
Here’s the DOW JONES approaching the 2008 top:
 
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This pattern repeats again in the DOW approaching the 2008 top.  It’s repeated before most crashes and bubbles going back to the beginning of markets. 
 
So what does it mean for us?
 
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The above chart shows the rapid climb in the USD index.  But it also shows the QQQs (Nasdaq 100) since the 2009 stock market bottom.  And you guessed it, a perfect LPPL structure.  This doesn’t bode well for financial markets.  But the question is always WHEN will the bubble burst?
 
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We’re always looking for signs of things breaking down in the economy.  With Jobs, they’re always bullish at a top.  As a divergence develops, it can lead or confirm a bearish move in the markets.
 
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Above we see a component of sentiment in the market – and an uptick in uncertainty.  This condition normally exists before corrections.  Corrections come about because Imitation is a big driver in the market.  We’ll have more on that later…
 
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And our last chart above shows the ECRI data – the uptick is bullish for the markets and part of our mid term call for a final thrust higher into April/May and then for things to get ugly…
 
Since 2005, Mark McMillan has been writing a daily article on the financial markets.  That type of experience is hard to come by.  Not only to see market turns over the past decade plus, but to advise traders how to position (or not to) through the move. 
 
And access to his personal chat room where you can hear him talk and address issues intra day – makes this opportunity that much better!
 
And we’ll throw in a 52-page presentation on Bubbles that will blow your mind and help you understand what to expect when this market collapses.
 
All for only $1.  
 
 
Don’t forget to USE DISCOUNT CODE TMP1 when signing up.
 
Regards,
 
Carl Adams, Publisher
 
PS – Again, this is a limited time offer, so subscribe today and join Mark’s subscribers in the chat room during the trading day.  CLICK HERE TO SIGN UP  and don’t forget to USE DISCOUNT CODE TMP1 when signing up.

NAAIM

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This indicator shows us when individuals are jumping in the market, which is usually a sign of a top…

From this week’s Daily Stock Barometer: Visit www.stockbarometer.com to access our stock market timing research!

Individuals In The Market?

Good morning Traders,
 
A few weeks ago, I introduced you to Damon Verial’s Penny Stock Service that we launched in January.  We’ll have his February performance update below as well as a special offer to sign up.  But first, let’s take a look at the stock market with some of our research that we published to clients over the week.
 
First up is a newer data series that we’ve been following.  It shows us how money managers are positioning their portfolios.  Obviously this data is bearish from a contrarian point of view, but just because it’s at a peak doesn’t mean we’re at a top…  There is also a bunch of data behind this list – too much to show you here.
 
Click here for more info...
 
Next up is our cumulative equity money flow ex etf chart that isn’t showing a bounce during this market bounce.   This can be a precursor to bad things to come.  
 
Click here to sign up!
 
Here is the performance update for our Penny Stock Trading Service – if you sign up this week, we’ll also give you our Stock Trading Secrets video series (a $20 value) and you’ll get Damon’s Gap Trading educational email series.
 
CLICK HERE TO SIGN UP – Use Discount Code  DVPS1 to get your first month for only $1.
 
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Penny Stock Performance Report for February 20152/23/2015 4:13:45 AM

Let’s start with the most important facts:

Average return on all trades: 21%
 
Average win-to-loss ratio: 8.3
 
Average annual percent return: 208%
 
Average trade duration: 24 days
 
Average win: 34.9%
 
Average loss: 7.7%
 
Profit-to-loss ratio: 4.5:1
 
Below are the facts for each trade:
 
Here are the numbers!
 
And a chart:
 
It's all about the performance - click here!
 

Our 3 best trades:

 
#3
You really want to click here - we know you do :)
 
#2
Click here now!
 
#1
Click here to trade with us!
 
 
If the performance data doesn’t show well on your email browser, feel free to email us and we’ll send you the spreadsheet in excel when you sign up.
 
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Back to the markets, here is one more chart for you:
 
Click here to sign up today!  $1 gets you 1 month and so much more!
 
From a sentiment perspective, it’s at a peak, diverging off the lows.  There’s still room to go higher, but it definitely raises the caution flag…
 
That’s it for this week – I encourage you to try Damon’s penny service, we’re launching it at this discounted price for only a short time, so take advantage today!
 
 
DON’T FORGET TO USE DISCOUNT CODE DVPS1 when signing up to get your first month free.  Sign up this week and we’ll throw in our Stock Trading Secrets Trading Videos and Price Gap Trading Tutorial. 
 
Regards,
 
Carl Adams, Publisher
 
PS – The price for this daily options advisory will be going up soon, so subscribe today and you’ll lock in this price as long as you remain subscrbed.  CLICK HERE TO SIGN UP  and don’t forget to USE DISCOUNT CODE DVPS1 when signing up.
 
Good morning Traders,
 
Last year we brought in Gregory Clay to head up an options income trading service because we expected markets to be more challenging as we near the end of the 2009 bull market.  Since then, we saw one correction last August and one consolidation that initiated last November and just completed recently.  While we expected good performance, we didn’t expect what we got.  And it’s because of that performance, Gregory’s service has been growing significantly.  Here’s his last performance update – going back to when we launched his service back in April of 2014:
 
 

Six Month Performance Results2/12/2015 2:12:19 PM
Market Summary
Weekly Income Credit Spread (WICS) six-month trade results are displayed below. The past six months we were able to execute 18 of the published trades. 17 of these trades closed out at a profit. Shown below are the details for each trade. The trades do not include commissions and fees. Also, results will vary based on the number of contracts traded, and at what price the orders are filled. The Opening Trade date is when the ‘Trade Alert’ was published for the trade. Each trade was closed out on the date associated with the Closing Trade. The gain or (loss) for each spread is highlighted along with a Summary Total (accumulated result of all the trades for the past year).
 
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Sign Up Now!!!
 
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Note
Weekly Income Credit Spread (WICS) trade setups are published in the evening for execution the following day(s). Suggested prices for each option contract are the published quotes at the time an article is written. We will provide trade price confirmation during the trading day. Keep in mind that in the ‘Trade Setup’ for Trade Alerts we suggest a minimum credit amount that we would accept. Generally, if the recommended prices are not available, we can accept the suggested minimum to do the trade. Be aware that high market volatility can make it difficult to execute trades at recommended prices
 
Regards,
 
Gregory Clay
Options Strategist
 
 
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Again, this performance has been really impressive in both return and consistency.
 
How do you start your subscription?
 
 
How do you get your first 4 weeks for only $1?   USE DISCOUNT CODE WIC1 when signing up.
 
So what about the markets?  The message is real simple – bonds are selling off and fueling stocks.  The advance has made the market very complacent, as evidenced by the chart below.  This complacency CAN lead to a top – but the liquidity from bonds CAN continue the rally.   We’re at 13 days running above the 9 day moving average.  A liquidity advance can last 30-40 days!  This would definitely lead to a peak in lime with our previous forecast. 
 
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Regards,
 
Carl Adams, Publisher
 
PS – The issue with Gregory’s Newsletter being so popular is that at some point, we will have to close this service off to new subscribers because Gregory’s trades/clients can actually move the market.  I expect to reach this saturation point in 2015.  So if you’re on the fence, sign up today to lock in your subscription.    CLICK HERE TO SIGN UP  and don’t forget to USE DISCOUNT CODE WIC1 when signing up. 
 
PSS – Supporting Healthy Clients – click here for our discounted health & fitness products
Good afternoon Traders,
 
As stocks continue the consolidation of the advance off October 2014, they’re set up for a significant move.  But the question as always is, which way…
 
Regardless, here’s a service that’s hitting it out of the park.  Damon Verial’s Penny Stock Trader.  These are stocks under $5 which are poised to move.  He’s building a portfolio and here’s his latest pick:
 
 
Trade Alert: CIG 2/9/2015 11:33:47 PM

CIG – Not a Cigarette Company

 
When we trade penny stocks, he hope they won’t be penny stocks in the future. Oversold “normal” stocks that dip below $5 are often the best penny stocks to play. CIG is one such case, especially with its yet-to-be-filled area gap:
 
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I prefer to leave the discussion of gaps for my newsletter on gap trading (the signup link is at the end of this email), but gaps are an important part of technical analysis, even on penny stocks. If you look at all the previous gaps in the chart above, you will see them filled. Only this gap has yet to be filled, implies a coming bullish trend.
 
As for CIG itself, you should know it’s an ADR, which is a foreign stock listed on the US exchange. The company is in Brazil, where all its profits come from. Thus, when the US dollar is strong, CIG will appear weak. Note that the US dollar is at a ten-year-high against the Brazilian real.
 
This fact (and the gap) point to CIG being undervalued. When the dollar weakens or the Brazilian real strengthens, CIG will necessarily increase in value. But we aren’t just playing a growth stock here.
 
CIG also pays out high dividends, which makes it a good stock for a buy-and-hold strategy. This is one of those penny stocks you might want to keep for the long term, or at least until you see a spike in price, at which time you can sell and take profit.
 
I believe CIG is a strong investment not just for the aforementioned reasons but also because of fundamental analysis. CIG, a utilities supplier (electricity), met with trouble last year when a drought hit Brazil. As much of CIG’s power stems from hydroelectric energy, the rationing of water hurt it greatly.
 
2015 is looking good for them. As the drought subsides and CIG diversifies its energy sources, the stock should surge.
 
 
So for now…
 
Buy CIG!!!
 

Our penny stock portfolio (*implies a star player):

*Sign up to see our portfolio of Penny Stocks
 
 
Thanks for reading today’s newsletter.
 
Subscribe here:
 
 
USE DISCOUNT CODE DVPS1 when signing up to get your first 4 weeks for only $1 and see Damon’s portfolio of penny stocks!
 
So what about the markets? 
 
Here’s a chart we shared with clients this am:
 
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We could be very close to a potential bottom here that could take us higher into April.  Penny stocks tend to perform best when markets are breaking out!  So don’t delay!
 
Regards,
 
Carl Adams, Publisher
 
PS – We are offering this service at 1/2 off for a limited time.  By signing up now, you will lock in your subscription price for as long as you remain subscribed.  We also offer 20% off for subscribing annually.   CLICK HERE TO SIGN UP  to our Penny Stock Newsletter and don’t forget to USE DISCOUNT CODE DVPS1 when signing up.
 
PSS – Your health is very important to us - Click here for our discounted nutritional fitness products
Good morning Traders,
 
For this weeks update, we’ll leave you in the extremely capable hands of our option strategist, Gregory Clay.  Gregory’s service continues to hit it out of the park.  If you’re not trading options for income, you should be.  You can try either of his services for only $1.  I suggest starting with the WICS – Weekly Income Credit Spreads.  In addition to his weekly income credit spreads, you’ll also get the weekly article below which Gregory uses to set up the market. 
 
 
 
January Barometer Sent Strong Negative Signal
2/1/2015 5:44:31 AM
 
Market Summary
 
Stock market action so far this year has been weak and mostly negative. This action has been fueled by plummeting oil prices, weakness overseas, confusion about the Fed’s next move and it’s bellowing about low inflation. Santa’s absence and a down January are bad omens, but they do not guarantee unmitigated market catastrophe. Lower oil and energy prices, while a drain on energy companies and the people they employ, it adds a lot of money back in the pockets of consumers to put into the economy and the stock market. Also, European quantitative easing funds are likely to find their way into the U.S. stock market where prospective returns are greater. 
 
The U.S. stock market ended a rough month this past Friday, delivering its third loss in five days and extending its declines for the year. The S&P 500 index dropped 3% in January, its worse monthly performance in a year. While the U.S. economy continued showing signs of strength, energy companies suffered from a sharp drop in oil prices and some big multinational companies saw their earnings dinged by a stronger dollar. Investors also sifted through the latest batch of corporate earnings news, and the results were mixed.
 
As we said recently “…Gold Mining stocks are blasting off to start the year and Treasury Bonds continue to move higher as they have since the beginning of last year. Equity indexes are barely breaking even and how they end up at the end of January is considered a “barometer” of how they will end the year…”
 
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A tool to help confirm the overall market trend is the Bullish Percent Index (BPI). The Bullish Index is a popular market “breadth” indicator used to gauge the internal strength/weakness of the market. It is the number of stocks in an index (or sector) that have point & figure buy signals relative to the total number of stocks that comprise the index (or sector). So essentially it is the percentage of stocks that have buy signals. Like many of the market internal indicators, it is used both to confirm a move in the market and as a non-confirmation and therefore divergence indication. If the market is strong and moving up, the BPI should also be moving higher as more and more stocks are purchased.
 
Last week we stated “…the S&P 500 BPI is breaking above its downtrend line and starting a new uptrend. The market needs to finish the month on a high note to confirm a bullish breakout…” the current chart shows the breakout failed and converted into a tight trading range. The question is whether a break out of the trading-range will be to the upside or downside.
 
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The updated chart below confirms our recent analysis is still valid “…As circled in the updated chart below the dollar, treasuries and gold remain converged at high levels. Investors are expressing doubts about the global economy and are being cautious about overindulging in the stock market. This cautiousness is leading investors to park additional funds into commodity assets…”
 
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Market Outlook
As reported by the Stock Barometer, in pre-election years, February’s performance generally improves with average returns all turning positive. NASDAQ performs best, gaining an average 2.4% in pre-election-year Februarys since 1971. Russell 2000 is second best, averaging gains of 2.1% since 1979. DJIA, S&P 500 and Russell 1000, the large-cap indices, tend to lag with average advances of around 1.0%. However, February does not have a solid track record when full-month January was negative. Going back to 1950, DJIA has declined 23 times in January, S&P 500 25 times and NASDAQ (since 1971) 15 times. Regardless of index, the following February was down more often than up and the average performance was solidly negative. 
 
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We recently commented “…Next week’s performance is considered critical as a prognosticator of the market’s expected 2015 performance. According to the Stock Trader’s Almanac January has quite a legendary reputation on Wall Street as an influx of cash from yearend bonuses and annual allocations typically propels stocks higher…January Barometer simply states that as the S&P goes in January so goes the year…The long-term record has been stupendous, an 89.1% accuracy…The market’s position on January 31 will give us a good read on the year to come…No other month can match January’s predictive prowess…”According to the Stock Barometer the January Barometer indicator is negative again for the second year in a row and 5 of the last 8 years. Since the start of the secular bear market in 2000 January has been down 7 of the last 15 years with an average loss of 1.2% on the S&P and Dow and a fractional gain of 0.1% for NASDAQ. All of the major errors have occurred in secular bears, so if we still are in a secular bear market, which we contend we are; perhaps we can find some solace in this fact. We are continually reevaluating the efficacy of the January Barometer as we do with all indicators, market cycles and seasonal patterns. But it is way too early to relegate the January Barometer to the indicator graveyard. Its 754 batting average is solid. Also of note, this is the first time since 1950 our January Indicator Trifecta has registered a down Santa Claus Rally, an up First Five Days and a down January Barometer.
Last week we said, “…Commodities continue to be the top performers in the first-quarter. Fourth-quarter revenue and earnings results have not impressed investors, which are suppressing the equity indexes…”
  
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A standard chart that we use to help confirm the overall market trend is the Momentum Factor ETF (MTUM) chart. Momentum Factor ETF is an investment that seeks to track the investment results of an index composed of U.S. large- and mid-capitalization stocks exhibiting relatively higher price momentum. This type of momentum fund is considered a reliable proxy for the general stock market trend. We prefer to use the Heikin-Ashi format to display the Momentum Factor ETF. Heikin-Ashi candlestick charts are designed to filter out volatility in an effort to better capture the true trend.
 
Last week’s Momentum Factor ETF (MTUM) chart analysis said, “…The current trend is pointing towards stock indexes moving back toward recent highs…” As noted in the updated chart below, recent upward momentum converted into a new downtrend. The most probable near-term outcome is range-bound trading with triple-digit market fluctuations.
 
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Volatility is back and may be here to stay. Expect more of it moving forward this year and beyond. As seen in the graph below, the Volatility Index (VIX) and S&P 500 Index crossed last week. The VIX ended higher as the S&P 500 had a down week. Energy companies start reporting fourth-quarter revenue and earnings numbers next week. If they disappoint it is reasonable to expect the VIX to continue higher.
 
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Our previous Total Put/Call Ratio analysis said, “…investors are worried about a market pullback and loaded up on put option contracts. The current ratio is excessively bearish and reflects money managers protecting their long positions in the event traders respond negatively to fourth-quarter earnings and revenue numbers…” Investors remain bearish and are buying more puts than calls in response to higher volatility.
 
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We have been pointing out how the American Association of Individual Investor Survey (AAII) survey continues to prove its worth as a contrarian indicator. Last week we stated, “…as retail investors drastically reduced their future bullish outlook the stock market jumped higher…” This past week you can see that as individual investors’ bullishness surged the stock market responded with a losing week.
 
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The National Association of Active Investment Managers (NAAIM) Exposure Index represents the average exposure to US Equity markets reported by association members. The green line shows the close of the S&P 500 Total Return Index on the survey date. The purple line depicts a two-week moving average of the NAAIM managers’ responses. As the name indicates, the NAAIM Exposure Index provides insight into the actual adjustments active risk managers have made to client accounts over the past two weeks. Fourth-quarter NAAIM exposure index averaged 67.77%. Last week the NAAIM exposure index was 76.23%, and the current week’s exposure is 92.62%. Last week money managers drastically increased their equity exposure on stocks that are exploding during fourth-quarter earning season.
 
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Trading Strategy
The equity market is suffering under the weight of concerns about global economic growth and mediocre fourth-quarter earnings reports. The graph below is the 30-day return for the main 10 S&P equity sectors. You can see virtually all the groups are down for the month with only Healthcare and Utility sectors barely above water.
 
Our index indicators are giving bearish readings, which is more in line with the general market trend than the occasional bullish readings such as we saw last week. The Dow has fallen into a bearish “lower highs, lower lows” chart pattern. Our internal indicators have also fallen back into more bearish modes, so options traders should continue to add bearish positions. Against the current whipsaw action, it is best to take smaller positions than you normally do, but don’t sit out completely.
 
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Feel free to contact me with questions,
 
Gregory Clay
Option Strategist
 
 
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Gregory just entered a trade in Netflix – subscribe now so you don’t miss his next trade!
 
Regards,
 
Carl Adams, Publisher