Stock Market Analysis

Tuesday, August 22, 2017

22 Aug Report Sent...

Today's daily report has been sent to all paid subscribers via email. Today, I discuss a critical reversal signal made in the market yesterday! Sign up now to receive this report today!

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This week is also my birthday week! Yes, celebrating my 41th birthday on the 25 Aug, my Star Trading System mentoring course will be available for sign up at a huge 50% discount! Yes, learn the exact secret of my stock picking method and arrive at the exact same trades and conclusions that I do independently for life! Take advantage of this discount now!

Monday, August 21, 2017

US Market Outlook Week 4 Aug

Welcome to week 4 of August!

Time flies and it is my birthday week again and that means another round of Jason's Birthday Sale on my Star Trading System Mentoring Course! Check it out now and learn with me 1 to 1!

The US market continued downwards last week after a failed reversal and the Dow proceeded to retest the 30MA as I have expected in my original outlook 2 weeks ago.

A lot of people asked me if this is the start of a market crash and I have always answered, no. I not only expect this to be a healthy intermediate correction for the sake of higher prices in the near future, I also expect this bull market to last at least for the next year as long as Trump remains in office. Why is that so? So far, nothing in the economic data suggests a bubble like all previous market crashes and nothing in the economic data suggests weakness as well. In fact, we are looking at a healthy growing economy riding on the back of an extremely conservative policy making which is aimed at reviving the local business, bringing back Jobs and business to the US (at the expense of many of the other countries that are so used to selling cheaper products to the US of course). As long as such policies are in place and are being developed, I see strong fundamental support and reason for the bull market to continue.

In fact, the last market crash of 2008 is arguably the worst market crash in the history of the US market due to many toxic reasons that built up in the US economy over the decades. That one crash "detoxed" the US economy, straightened up credit policies which was the cause of the whole bubble, cleared out the housing bubble etc, setting the fundamentals for the economy to grow in a more healthy manner and for the stock market to go into yet another real bull market that has not been seen since the tech bubble of 2000.

Many experts would disagree with me on these. In fact, many are quoting the Hindenburg Omen for basis of a market crash but lets not forget how the Hindenburg Omen missed it last year when it was ringing off its hooks. US is having a president that has never been seen before with policies that never have been pushed for before and growing on reasons that never have existed before. This makes many of the historical patterns that we were so used to less than effective. At least this is what I think and so far, I think I have been pretty accurate about the US market for the past 12 years.

For now, the market remains in short term bear trend within an intermediate neutral trend and primary bull trend.

Friday, August 18, 2017

US Market Returns To Intermediate Correction...

In one fell sweep, the market reversed back on track for the intermediate correction I talked about so much over the past two weeks again. Good thing my Master's Stock Options Picks subscribers and I  only took very small positions in call options on QQQ over the last two days partly because I was anticipating the possibility of such a move and didn't want to make the usual commitment.

The Dow made is biggest single day fall since May, dropping 274 points, taking out all of the small gains over the past few days and restested the 30MA all at once. Indeed, as I have said before last week, the intermediate correction is going to retest the 30MA and then go largely sideways with a bit of bearish inclination just like what it did back in March. This is because there isn't anything in the fundamentals that warrant an all out market crash yet and such intermediate corrections are very common especially around critical psychological levels like the 22K level and the 21K level etc. The Dow also took months of sideways bearish inclined movement before it mustered enough strength for a real 21K break out in April.

Supporting that outlook is also how the Dow made a volume spike yesterday. Such volume spikes almost always suggest an overdoing and a short term reversal. The lack of any real disappointment in the economic numbers also suggests that this drop is an overdone one. As such, I will be switching back to the intermediate correction trading plan I talked about last week, seeking long and call entry opportunities around this level and also layer strategically into my existing QQQ call options.

For now, the market turns a short term bear trend within an intermediate neutral and primary bull trend.

Wednesday, August 16, 2017

US Market Reverses Out Of Intermediate Correction!

Over the past two days, the US market did a surprise reversal out of the intermediate correction on news that North Korea has halted its plan to shoot at Guam. This is the kind of news that awakened investors, turning the market around. Here was what I told paid subscribers in yesterday's report:

"... so strongly that the reversal yesterday is that kind that once again, like back in November 2016 when Trump got elected, the intermediate correction has come to a screeching halt, broke its pattern and it is my opinion that it has been reversed..."

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In fact, on Monday midday, when I heard the news and saw investors reacting to it strongly, I knew the dynamics behind the intermediate correction is all but reversed and it is time to accumulate ahead of where I expected to around the 30MA line. My Master's Stock Options Picks Subscribers and I resolutely took call options positions on the QQQ on Monday and am now sitting on some profit. This is how quickly real traders need to identify and react to changes in the stock market and in one's outlook. (did you miss making money YET AGAIN? Come on, quit short changing yourself and join me for just $1 today!)

In fact, I like how both the S&P500 and the Nasdaq 100 has reversed back up above their 30MAs from below it, technically completing a short term pullback the kind we saw back in June. As such, calling this a reversal isn't really that far fetched since the bulk of the market as indicated by the S&P500 has already retested and rebounded from the 30MA even though Dow's 30 stocks hadn't. 

The move these two days were also supported by a continued rise in bond yields as investors continue to join in the party and leaving the safety of bonds. All in all, I think this is a great time to start layering in longs, not 100% in yet, but slowly, step by step in case the intermediate correction isn't done yet. Again, if you don't know how to do so yourself, let me tell you how to do it for just $1!

For now, the market remains in short term neutral trend within an intermediate neutral trend and primary bull trend.

Monday, August 14, 2017

How Might This Correction Unfold?

Welcome to week 3 of August 2017! This is also expiration week for August options so those of you holding vanilla August options, please take note of this Friday's expiration. (Read more about Plain Vanilla Options)

The market has pulled back into an intermediate correction since I identified the inverted hammer signal on the Dow last week, textbook style. In fact, the Dow closed its most negative week last week since May 2017, closing a -1.06% week. However, even that is nothing compared with the really negative weeks we saw back in 20015. This is still a very very impressive year so far.

In fact, I continue to be surprised with the amount of strength holding up against the correction so far as we can see significant accumulation in the Nasdaq last Friday and slight positive close on both the Dow and the S&P500. This is a sign of strength showing that investors are not afraid to buy into a falling market and holding it across the weekend. In fact, looking at the bond yields and the total equities put call ratio, none of them are shouting out bearish market very strongly at all but continue to be more or less uncertain. All of these supported by the ever strengthening economic numbers  supports my opinion that this isn't the start of a market crash like so many experts out there are predicting but just a largely sideways bearish inclined intermediate correction like we saw back in March.

We should still see a retest of the 30MA this week though and most likely also a crossing under of the 10MA below the 30MA. And that area would be where I would be seeking to identify good call options opportunities for my Master's Stock Options Picks subscribers.

Have a great and profitable week ahead!

For now, the market remains in a short term bear trend within an intermediate neutral and primary bull trend.

Friday, August 11, 2017

Intermediate Correction Starts...



Exactly as I have predicted since last week, the US market hit yet another exhaustion point at 22,000 points, just like it did back in 21,000 points, and is undergoing an intermediate correction before it can muster enough energy to break the 22,000 points level for real, just like it did back in 21,000 points. Yes, in my report to paid subscribers yesterday morning, I pointed out a confirming signal that the market did on Wednesday close that confirms the inverted hammer signal of 3 days ago to be the beginning of the intermediate correction. This was part of what I said:

"What this means is that yesterday's... confirmed and reinforced my prediction that the Dow is going to turn around significantly following yesterday's topside inverted hammer candlestick..."

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Yes, even though I have called this intermediate correction, I am also of the opinion that as long as Trump remains in office, this primary bull rally has about another year to go and is about only 1/3 way through. Why do I think that way? Because the fundamentals are still strong and getting stronger. Within the framework of such strengthening economic fundamentals, a pullback like this is not likely going to develop into a full on primary bear market crash. As such, I won't be too eager to bet to downside but to keep my eyes opened for opportunities to enter to upside when this short intermediate correction bottoms out.

Supporting this intermediate correction so far is how the volume has contracts all through to the inverted hammer which marked the peak and then starts rising into the fall (see picture on top). This is such a 3 points textbook and classic reversal pattern that it cannot be missed by anyone who has learned even very elementary technical analysis.

Point 1: inverted hammer candle occurring at new high after 10 consecutive up days
Point 2:  volume dropping prior to inverted hammer candle
Point 3: volume rising into the drop

Looking at my favorite support indicators, bond yields continued to retreat as investors continue their rush back to the safety of bonds, supporting the current bearish sentiment. Total equities put call ratio is somewhat at par so traders are a little uncertain now with the market dropping by so much in a single day.

All in all, I see a retest of the 30 days moving average coming up and mostly likely a brief visit below before everything return to normal again.

For now, the market turns a short term bear trend within an intermediate neutral trend within a primary bull trend.

Thursday, August 10, 2017

10 Aug Report Sent...

Today's daily report has been sent to all paid subscribers via email.

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Wednesday, August 09, 2017

Dow Forms Dangerous Signal...



The Dow broke its 10 days bullish run yesterday with a small 16 points retreat after my loooong report to paid subscribers yesterday. Here was what I said:

"The Dow continued higher yesterday, its 10th straight positive day, putting the odds of the next week being negative at more than 90%."

Yes, with the Dow making 10 straight positive days on Monday, the odds are overwhelming for a turn around, which it did.

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Yesterday, the Dow formed an extremely bearish signal that further reinforced my prediction that this is when the US market could go into an intermediate correction before it finds strength to break the 22K level for real. Yes, just a couple of days peek above a powerful psychological level like the 22K and 21K level isn't a breakout at all. In fact, most of the time, its a bull trap (meaning a delicious positive day before everything turns down), just like what we saw back at the 21K level. The bearish signal I am talking about is an inverted hammer candlestick with a volume surge, occurring with new historical high price made on the wick of the candle itself. An inverted hammer candlestick is a candlestick which has a long tail on top and a small body near the bottom which is formed by the the market moving strongly intraday, hit a new high and then selling sets in to take it all the way to close at or near the opening. This is a price action that tells us that people are selling into the high strongly and is winning at it. This is an EXTREMELY bearish candlestick setup which, occurring at such a level usually means a significant pullback is in the books. In fact, the volume yesterday was the highest since June and is the kind of sudden volume surge that usually suggests something is about to change. 

Investors and traders continue to be uncertain and split as bond yields rises with a return to equities while total equities put call ratio remained at par. Such is the kind of pattern that tops show. As such, I continue to believe that this is at least where you don't want to be newly long and be patient and see what the market does for the rest of the week before considering an entry.

For now, the market remains in short term neutral trend within an intermediate and primary bull trend.


Tuesday, August 08, 2017

8 Aug Daily Report Sent...

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Monday, August 07, 2017

US Market Still On Track For Intermediate Correction...


Welcome to the second week of August!

Last week was truly one incredible one not only in terms of stock market performance but also in terms of economic data performance!

In terms of stock market performance, even though the S&P500, which is the broadest measure of the US stock market of the 3 major indices, did continue largely sideways as I have predicted, the Dow has continued to defy gravity and made 9 straight positive days on its own, breaking the 22,000 points level.

In terms of economic data, last week's ISM index and Jobs Report, the two main heavyweight economic indicators of each month, beat all expectations just like how economic data seems to have been doing since Trump took office. Yes, ever since Trump took office, economic data has tended to surprise to upside, leading to the persistent rally that we have experienced so far.

So, am I wrong that this is where the market might pullback? Should we chase after this bunny?

Not quite yet.

The S&P500 and the Nasdaq are both quite on track, moving largely sideways with strong bearish inclinations and that continued to support my intermediate bearish outlook. Even though the Dow continued to behave as the runaway horse here, it is actually stacking up more and more reasons to be bearish on it. On top of the reasons I have qouted to paid subscribers last week, here are 3 more for this week (wish to be on the paid subscriber email list? Subscribe by hitting the yellow button on the right below my profile photo) . First of all, it making 9 straight positive days. Whenever the Dow makes that many positive days in a row, it tended to pull back within the next week or so. Secondly, volume has been steadily declining while the Dow climbed higher, that is a very strong bearish reversal signal especially when occurring around psychological levels like the 22K level and multiple day rallies. Thirdly, big levels like the 21K and 22K level just don't give in without a fight. When the Dow first broke the 21K level back in March, it did so with grandeur before collapsing straight into an intermediate pullback, the kind of sideways extended bearish inclined pullback that I am expecting this time round too. Even though the Dow didn't quite go downwards at the 20K level, it did struggle along that line sideways for about 2 months before it gather enough energy for a real breakout.

All in all, I am saying the market is still in line for that intermediate pullback that I have spoke of over the past 2 weeks and therefore, this is not the time to be newly long. In fact, my Master's Stock Options Picks subscribers and I exited yet another one of our call options positions last week and luckily in a positive way.

For now, the market remains in short term neutral trend within an intermediate and primary bull trend.

Thursday, August 03, 2017

3 Aug Daily Report Sent...

Today's daily report has been sent to all paid subscribers via email.

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Wednesday, August 02, 2017

Uncertainty Continues To Build Up... Intermediate Correction Coming?

US Market continues to struggle as uncertainty continues to build up while the Dow continues to be the runaway horse, making yet another significant positive day.

However, like I told paid subscribers in yesterday's paid only report, the Dow don't seem to be able to lead as a runaway like the Nasdaq can due to it being comprised of just 30 stocks. Here was what I said...

"...I am not so positive when the wild horse is the Dow as the Dow contains too few stocks to be very representative of a significant portion of the market."

 In fact, I do expect the intermediate correction to start when the Dow at last runs out of steam and turns downwards. Yesterday, I explained to paid subscribers a formation that the Dow made which indicated that it has ran out of steam (wish to be on the paid subscriber email list? Subscribe by hitting the yellow button on the right below my profile photo) and interestingly, the Dow continued to make yet another of that indication, making it increasingly dangerous and therefore increasingly uncertain. Another thing that supports the intermediate correction happening at this level is how the market failed to react positively and strongly to a surprisingly strong ISM index released yesterday. The ISM index, along with the Jobs Report, is one of the two most important economic indicators that investors and the Fed watch very closely. The fact that even such a report failed to move the market tells me that the slightest bad news may start a bear slide.

Looking inside, bond yields barely nudged and total equities put call ratio remained at par as both investors and traders remain uncommitted to either direction. This is a very typical behavior when the market is at a very uncertain point.

"Uncertain" means that investors are not committed strongly in either direction due to having plenty of reasons to believe that the market can go up as well as down. If uncertain means down, it won't be uncertain, right? 

Yes, even though I am seeing increasing signs that this may be the start of an intermediate correction, investors and traders are both not committed to my prediction yet, perhaps waiting to see how Friday's heavyweight Jobs Report would turn out. However, with the Jobs Report widely expected to miss expectations, that may be the trigger that push investors and traders towards the bearish camp.

Today, me and my Master's Stock Options Picks Subscribers would also be looking to exit the last of our profitable call options positions. Did you profit from this last rally like we did? Join me for just $1 now!

For now, the market turns a short term neutral trend within an intermediate and primary bull trend.