{"id":159629,"date":"2019-11-12T07:45:44","date_gmt":"2019-11-12T12:45:44","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=159629"},"modified":"2019-11-12T07:09:50","modified_gmt":"2019-11-12T12:09:50","slug":"welcome-to-the-zombie-land-of-investing-part-ii","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/11\/welcome-to-the-zombie-land-of-investing-part-ii\/","title":{"rendered":"Welcome to the Zombie-land Of Investing \u2013 Part II"},"content":{"rendered":"
November 12, 2019<\/div>
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By TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n

In Part I<\/a><\/strong> of this research post, we highlight how the ES and Gold reacted 24+ months prior to the 2007-08 market peak and subsequent collapse in 2008-09.\u00a0 The point we were trying to push out to our followers was that the current US stock market indexes are acting in a very similar formation within a very mature uptrend cycle.<\/p>\n

We ended Part I with this chart, below, comparing 2006-08 with 2018-19.\u00a0 Our intent was to highlight the new price high similarities as well as the price rotation similarities between the two critical peaks in market price. We are terming the current market a \u201cZombie-land\u201d because it appears global investors are somewhat brain-dead as to the total risks that are setting up in the global markets right now. But, wait before you continue reading make sure to\u00a0opt-in to our free market trend signals newsletter<\/strong>.<\/strong><\/p>\n

Forward guidance is waning. Earning expectations are decreasing.\u00a0 Debt levels are skyrocketing all over the planet.\u00a0 Global banks are continuing to move into more Quantitative Easing measures to attempt to spark growth.\u00a0 The equity markets are 9+ years into a rally while the global central banks are 10+ years into some form of continued QE efforts.\u00a0 Global economic data suggests a moderate downturn in economic activity and growth for many foreign nations.\u00a0 We believe the next crisis will not originate in the US, but from outside the US.\u00a0 We believe the risks associated with the massive debt levels in the foreign markets will be the reason for another price decline.\u00a0 Quite possibly, a commodity price collapse (think OIL) will become the catalyst for this event.<\/p>\n

If Oil were to fall below $45\u2026<\/h3>\n

If Oil were to fall below $45 (eventually possibly flirting with the $30 price level) as our predictive modeling suggests<\/a><\/strong>, then we believe many foreign nations will suddenly become serious risk factor related to debt\/credit and could potentially create a domino-process where the US\/Global markets collapse on this new risk factor. Our last predictive model signal was for natural gas and we just close out the trade locking in 19% profits this week.<\/p>\n

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Is 2007 setting up all over again?<\/h3>\n

But what if this is 2007 setting up all over again?\u00a0 Take a look at the ES chart above \u2013 where a peak setup in May\/June 2007, followed by a deep price correction.\u00a0 Follow that price move even further to see how price rallied to a new all-time high throughout July, August and most of September before setting up in a deeper price rotation in late September and carrying forward into October.\u00a0 Now, take a look at this current ES Weekly chart to see if there is any similarity between them.<\/p>

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Gold up 50% From Its Lows Already<\/h3>\n

Gold has already rallied nearly 49% from the 2015 lows and the recent price rotation is somewhat similar to what happened to Gold in 2006-2007.\u00a0 The extended base that set up between 2017 and 2018 could be interpreted as a similar type of base that set up in 2006-07.\u00a0 The current rally is somewhat similar to what happened in late 2007 and early 2008 when the US stock market began to collapse volatility expanded in a strong uptrend which was followed by a moderate price retracement before Gold began a rally totaling more than 250% from the base\/bottom.\u00a0 Is this setup happening again right now?<\/p>\n

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Weekly NQ chart shows the extended melt-up<\/h3>\n

This Weekly NQ chart shows the extended melt-up that is taking place after the October to December deep price rotation that took place in 2018.\u00a0 We believe this deep price rotation is similar to the deep price rotation that happened between July and September 2007.\u00a0 The subsequent \u201cmelt-up\u201d process is a function of the \u201czombie-land\u201d function of price and bias.\u00a0 Investors chase after security and returns by pushing the price higher and higher when fundamentals and expectations don\u2019t align with these expectations.\u00a0 This same type of \u201czombie-land melt-up\u201d happened in 2007 as well.<\/p>\n

We understand the implications of this research post and want to warn all of our followers they need to be extremely cautious of the current market setup.\u00a0 Even though the US stock market may continue an upside bias within a melt-up process, we believe there are very strong underlying risks in the markets that could prompt a very deep price correction.<\/p>\n

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The US Fed is not lowering rates because \u2026<\/h3>\n

The US Fed is not lowering rates because of market strength and super strong forward guidance.\u00a0 They are lowering rates because they believe risks exist in the debt\/credit market and are trying to stay ahead of a big problem \u2013 a potentially very big problem.\u00a0 The overnight REPO market has been a topic for our researchers for the past 45+ days as this temporary institutional debt tool has exploded recently.\u00a0 Now, the US Fed has actively decreased rates and has begun acquiring more debt on its balance sheet.. hmm.\u00a0 That seems strangely similar to another credit\/debt crisis event.<\/p>\n

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(source: https:\/\/thesoundingline.com\/october-saw-the-largest-increase-in-feds-balance-sheet-since-the-financial-crisis\/<\/a>)<\/p>\n

We know many of our followers may consider this just another warning from a bunch of doom-sayers again.\u00a0 We\u2019re not wishing for this outcome \u2013 trust us.\u00a0 We simply look at the technical data, determine a probable outcome and present our findings to our followers to try to keep them informed.<\/p>\n

Too many similarities are starting to align to make this just some strange coincidence.\u00a0 Too many unknowns and uncertainties are aligning just 12 months before a US presidential election cycle.\u00a0 It seems strangely familiar to us that these same types of price events are unfolding now.\u00a0 If there is no correlation then we\u2019ll likely be incorrect in our analysis.\u00a0 But if we are right and there is a major price reversion event setting up, we think it is wise to alert as many of our friends as possible.<\/p>\n

Keep reading our research because our proprietary tools have been nailing all of these price targets and move many months in advance.<\/p>\n

I urge you visit my\u00a0ETF Wealth Building Newsletter<\/strong>\u00a0and if you like what I offer, join me with the 1-year subscription to lock in the lowest rate possible and ride my coattails as I navigate these financial market and build wealth while others lose nearly everything they own during the next financial crisis. Join Now and Get a Free 1oz Silver Bar!<\/p>\n

As a technical analysis and trader since 1997, I have been through a few bull\/bear market cycles. I believe I have a good pulse on the market and timing key turning points for both short-term swing trading and long-term investment capital. The opportunities are massive\/life-changing if handled properly.<\/p>\n

Chris Vermeulen –\u00a0TheTechnicalTraders.com<\/u><\/a><\/strong><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By TheTechnicalTraders.com In Part I of this research post, we highlight how the ES and Gold reacted 24+ months prior to the 2007-08 market peak and subsequent collapse in 2008-09.\u00a0 The point we were trying to push out to our followers was that the current US stock market indexes are acting in a very similar […]<\/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-159629","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/159629","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=159629"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/159629\/revisions"}],"predecessor-version":[{"id":159636,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/159629\/revisions\/159636"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=159629"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=159629"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=159629"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}