{"id":147169,"date":"2019-05-07T08:00:27","date_gmt":"2019-05-07T12:00:27","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=147169"},"modified":"2019-05-07T06:41:07","modified_gmt":"2019-05-07T10:41:07","slug":"us-stock-markets-could-rally-beyond-expectations","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/05\/us-stock-markets-could-rally-beyond-expectations\/","title":{"rendered":"US Stock Markets Could Rally Beyond Expectations"},"content":{"rendered":"
May 7, 2019<\/div>
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By TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n

Late Sunday afternoon, President Trump surprised the global markets with the announcement of increased trade tariffs with China relating to the ongoing trade negotiations and delayed trade talks between the two global superpowers. The global markets reacted immediately upon the open Sunday night (Asian open). The VIX short position puts quite a bit of professional traders at risk of big losses today while those of us that were prepared for an increase in volatility and price rotation is poised for some incredible opportunities.<\/p>\n

The US stock market is set up for a price move that will likely make many people very wealthy while frustrating many others over the next few months.\u00a0 We\u2019ve recently posted many articles regarding the 2020 US Presidential election cycle and the fear cycle that comes from these major political events.\u00a0 In November 2016, we remember watching Gold rally $60 early in the election night, then fall $100 as news began reporting the surprise winner.\u00a0 There is so much capital, and future capital expectations that ride on these election cycles \u2013 it can actually drive the markets in one direction or another.<\/p>\n

Right now, we have two things we want to alert you to regarding our proprietary Fibonacci price modeling utility.\u00a0 First, the current trend is Bullish and the chance of a downside price move is still valid.\u00a0 Remember, one of the primary price rules within Fibonacci price theory is that price must ALWAYS attempt to seek out new highs and new lows \u2013 at all times.\u00a0 This means that once price establishes new price highs, any failure to continue establishing new price highs, through standard price rotation, will result in its price attempting to establish new price lows.<\/p>\n

So, as we continue with our expectations, remember that any failure of price to continue the push higher means it WILL rotate lower and attempt to establish new price lows.<\/p>\n

Taking a look at this IWM Monthly chart shows a very clear price rotation near the end of 2018 and that the current price has yet to rally above the October 2018 highs.\u00a0 In this instance, we have a FAILURE to establish new price highs within the current price move.\u00a0 We also have a new price low established in December 2018.\u00a0 This high and low sets up the range of $173.99 and $125.80.\u00a0 Fibonacci price theory tells us that PRICE WILL attempt to establish a new price high or new price low from within this range.\u00a0 Therefore, the price WILL either continue to rally higher and break the $173.99 level or price WILL reverse lower, without reaching the $173.99 level and target the $125.80 level.<\/p>

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Our modeling system is currently telling us that price and trend is bullish and that the current price level has clearly rallied above the Fibonacci price trigger levels near $143.50.\u00a0 Should price rotate lower and breach these Fibonacci price trigger levels, then we would expect the price to move much lower.\u00a0 Right now, we don\u2019t expect that to happen based on a strong US economy, employment and earnings.<\/p>\n

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This Monthly SPX chart shows a similar setup \u2013 yet the main difference is that the current HIGH PRICES are clearly above the October 2018 previous highs.\u00a0 Thus, in this instance the SPX has reached \u201cnew price highs\u201d as a component of Fibonacci price theory and, because of this fact, must continue to strive for new price highs or risk failing and rotating lower to establish new price lows.<\/p>\n

In fact, the past three trading sessions are proprietary SP500 index trading system issued two quick winning trades for members. The two trades pulled 2.5% and 2% out of the market in less than 24 hours from the entry prices. This momentum and trend trading system are going to be a new trading weapon for us to follow and trade the markets once we implement this into the member\u2019s area for viewing the charts and signals at any time.<\/p>\n

Take a look at last weeks trade and today\u2019s trade which both hit T1 (Target 1).<\/p>\n

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Take a look at the chart below then consider what that last statement really means.\u00a0 It suggests that we have already reached into new price high territory.\u00a0 Fibonacci theory suggests that \u201conce new price highs are established, the trend MUST continue to attempt to establish new higher price highs \u2013 OR FAIL and attempt to establish a new price low.\u00a0 Well, a failure at this level could mean a price move all the way back towards recent lows near December 2018 \u2013 near $2346.58.\u00a0 Therefore, it is critical that we see other markets, like the IWM, continue to push higher in an attempt to support this broader upside price move for all the US major stocks.<\/p>\n

The most important factor going forward is to be prepared to think and react very quickly to price rotations, news, and the election cycle process.\u00a0 Take a look at how volatile the market has become over the past 12 months and consider the fact that we could continue to see this type of volatility in the markets for the next 15+ months \u2013 at least through the election cycle process.<\/p>\n

Remember also that the US economy is operating on very strong fundamentals, employment, and outputs.\u00a0 Disruption of future expectations could lead to a massive displacement of capital in the global markets.\u00a0 Watch Oil, Gold, Silver and other commodities for any signs of weakness.\u00a0 And pay attention to the levels we are suggesting in this research post.\u00a0 If the SPX falls below $2600 \u2013 be prepared.\u00a0 If the IWM falls below $142 \u2013 be prepared.\u00a0 Price is always seeking out new price highs and new price lows.\u00a0 If it can\u2019t get one side, it will attempt to get the other.<\/p>\n

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The global market \u201cShake-out\u201d that we wrote about weeks ago is just starting.\u00a0 Our expectations are that an increase in price volatility, as well as a minor price rotation, will take place in the US markets before a continued upside price bias will drive prices higher again.\u00a0 There are two main drivers that will become leaders of any bigger rotation in the global markets \u2013 Metals and Commodities.\u00a0 If we begin to see a collapse in commodity prices, pretty much across the board, while metals breakout into a rally, then we are setting up for a bigger downside price move.\u00a0 Until that happens, continue to expect an upside price bias to continue in the US stock market.<\/p>\n

Secondly, should a massive currency revaluation event take place, where global currencies weaken as the US Dollar stays strong, then we could be setting up for a \u201cslow unraveling\u201d of foreign debt markets and foreign equity markets.\u00a0 This would be almost like a \u201cslow bleed out\u201d as a currency devaluation event prompt incredible pricing pressures on local foreign governments to support their economies.\u00a0 These devaluation events, if they happen, could prompt a hyper-inflation type of event that could disrupt weaker nations to such a degree that they could weaken world-leading economies that have exposure to these foreign nations \u2013 Think China\/Russia.<\/p>\n

Our advice continues to be to look for opportunities as the volatility increases and continue to expect an upside price bias in the US stock market \u2013 at least until we have any strong evidence that price trend has changed.\u00a0 Don\u2019t buy into the doom-sayers just yet.\u00a0 In our opinion, this US upside price move is not over yet.<\/p>\n

If you want to become a technical trader and pull money from the markets during times when most others cannot be sure to join the Wealth Trading Newsletter<\/a><\/strong> today. Plus, for a few days only I\u2019m giving away and shipping Free Silver Rounds to subscribers who join our select membership levels.<\/p>\n

Chris Vermeulen – TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

By TheTechnicalTraders.com Late Sunday afternoon, President Trump surprised the global markets with the announcement of increased trade tariffs with China relating to the ongoing trade negotiations and delayed trade talks between the two global superpowers. The global markets reacted immediately upon the open Sunday night (Asian open). The VIX short position puts quite a bit […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-147169","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/147169","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=147169"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/147169\/revisions"}],"predecessor-version":[{"id":147170,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/147169\/revisions\/147170"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=147169"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=147169"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=147169"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}