Hi everyone and welcome to the Yellow Tunnel community, a family of trading services dedicated to all classes of traders seeking to elevate their trading skills, market awareness, and trading profits.
This week, inflation once again reminded us of its stronghold on market sentiment and direction as several domestic economic reports and foreign banks showed the elongated effect the latest inflation levels have had. But even closer to home, I saw its impact firsthand.
The balcony in our home has been in need of repair for some time and as summer went on I contacted a few contractors to receive estimates for the job. While I factored in some price hikes due to inflation, I was not expecting manual labor and parts to have ballooned this much in price!
Shocked by the prices of my local handyman, I took my efforts online and sought several second opinions. Angie's list, and apps alike, brought me to similar and even pricier conclusions. Somehow, the new standard for work was a minimum of $1000 a day, even if the job took less than half of that!
Ultimately, I was reminded of an Ayn Rand character who took on physical labor during a labor strike in order to accomplish the work he wanted and had originally planned to hire out. The arch showed the joy of taking action into your own hands and accomplishing your goals when exterior forces appear against you.
Over the weekend, I had some time and did just that. After cleaning off the balcony, I headed to Home Depot to rent proper power tools. As I removed the tiles, sanded the ground, and began replacing the tiles, I began to feel a growing sense of accomplishment. The process was not easy by any means but attainable the more I put into it, growing my confidence as the process went on exponentially. For example, if you would've seen me with the concrete sander when I first turned it on you would've thought I could have better luck taming a wild horse - for the life of me I could not reign control of the sanding machine.
But with no outs and only myself to depend on, I knew I had to figure it out. I regained control of the sander, found the right setting, and settled into a nice groove as I continued my home improvement project.
This is no different than what I did at Options Express. Instead of relying on others, I took my trading and my career into my own hands and built the tools necessary for my success. Now, I want to share those tools and methods I learned while taking matters into my own hands.
And that's just how it goes. Sometimes, you've got to take things into your own hands to get them done. However, sometimes you are able to be part of a group heading towards a specific goal - working in tandem. That is why I recommend being part of a trading community where you can discuss and dissect with others. This is exactly what we did in my latest Strategy Roundtable, which we hold weekly on YellowTunnel. I recommend checking out our latest Roundtable webinar in its entirety below:
With the unpredictable nature of the market and the uncertainty ahead of us, I can’t emphasize enough how vital it is for our readers and members of the Yellow Tunnel community to keep referring to our Live Trading Room so as to maintain a close tie of how our I and my AI platform is navigating us in and out of select trades. It’s FREE and I highly encourage everyone to sign up to the Live Trading Room and keep checking in throughout the trading day.
Every Monday and Wednesday, I highlight our best strategies and potential trading setups via the DISCORD server. It’s the future of bringing together a trading community’s total services, educational products, live chat venues, support, news, how-to tutorials, webinars, live-trading demonstrations, and tons of market analysis. It is incredibly interactive and full of crucial and timely information. Just go to:
I also want to emphasize to traders how vital a stop-loss discipline is to winning and being successful in an unforgiving market. We employ specific stop-loss instructions with every trade. The buy and sell programs controlled by high-frequency related algorithms can create great profits or cause sudden losses, so it is imperative to maintain an element of controlling risk with each trade.
CURRENT TRADING LANDSCAPE
As of Friday, the 5-day chart shows the $SPY was trading 1.41% lower, just over $361. The S&P 500 continued its selloff on Friday as the latest movement in the bond market appeared to weigh on assets throughout the market. Likewise, oil and gold traded lower throughout the week, though gold was traded slightly higher on Friday. Global markets saw back-and-forth action throughout the week, with European markets closing higher on Friday, while Asian markets remained mixed.
The 5-day $TLT chart showed the Treasury ETF primarily moved lower throughout the week, finishing near $103. The $DXY marginally fell on Friday, near the $112 level, after trading impressively higher throughout the week.
This past week, U.S. Stocks saw a back and forth week that appeared to have developed its bottom following the latest Federal Reserve policy update. After two straight days of losses early in the week which had shares near multi-month lows, U.S. indices rebounded on Wednesday. However, the bounce was limited, and stocks continued to fall on Thursday.
On Thursday afternoon, following the release of a set of mixed economic reports that pushed up the probability of the Federal Reserve moving to raise interest rates sooner than later in order to keep inflation under control, stocks registered sharp declines. The $VIX is trading near the $30 level, of its $33 high from earlier this week.
Additionally, global policy updates have been dominating the market discourse, with two developing updates coming from Japan and England. On Wednesday, the Bank of England announced it would buy an unlimited amount of bonds in an effort to restore “orderly market conditions,” which immediately sent yields lower. Initially, the Bank of England’s decision to resume its bond-buying program in an effort to stabilize the country’s bond market caused global yields to pull back, giving stocks a boost on Wednesday.
England's move was preceded by Japan taking additional action as the Bank of Japan announced this week that it will buy Japanese government bonds through a special operation. The BOJ plans to buy debt with ten- to twenty-five-year terms and securities with five- to ten-year durations, worth 250 billion yen in total.
As global interest rates climbed to unprecedented heights, the Japanese bond market was straining as a consequence of an exceptional rise in global interest rates, with major central banks including the U.S. Federal Reserve and the European Central Bank speeding to raise rates to cool overheated prices. The yield on benchmark 10-year bonds reached 0.25%, which is the policy barrier, as global rates surge and the bank tries to keep up.
As a result, the dollar touched a twenty-year high, reinforcing the idea of a market downturn while also establishing a solid bottom. It seems that inflation will be a long-term problem, and short-term U.S. yields have increased sharply, now trading near the 4% mark. Although they have gone down somewhat from this week's high, as long as they stay above 3.5%, there is a chance of more pressure on markets.
Reviewing the above levels of the SPY seasonal chart with the latest news in mind, it is clear the latest market pullback is underway. The dollar has spiked to a 20-year high while a Treasury-ignited selloff took place. Action by the Bank of Japan and Bank of England, as well as previous comments from the FOMC, have added pressure to global markets.
I am keeping an eye on overhead resistance levels in the SPY, which are presently around $376 and $390. The $SPY support level is at $360 and then $350.
Short-term the market appears to be oversold and I believe the current pullback will continue for two to eight weeks, with the ability to reach June/July lows.
Still, there is potential for the market to stage a multiple-week rally in the November-December time frame. I would be a seller into any further rallies and encourage subscribers not to chase the market at these levels.
NEW EARNINGS POWER TRADER SERVICE
I recently launched our new Earnings Power Trader service which I am very excited about. Each week, our expert traders use our AI Tools to provide the Top Bullish and Bearish Stocks, each with an Entry Price, Target Profit, and Stop Loss.
This new service is special because it offers real-time alerts via SMS and access to Vlad's live positions and orders. When I put together this system, I wanted to be in the fight with other investors. That’s why I don’t play on your emotions to sell newsletters - I put my money where my mouth is.
Every trade recommendation that I make using this system – comes straight from the list of trade recommendations I use myself.
Not only that but every trade I make is logged in detail for you to review at any time. You can see my entire trading history, updated LIVE so that you can see, learn from, and even copy my trading strategy. Click here to learn more.
Signals have historically averaged over 85% accuracy in my live trading since inception. Sometimes I hold positions for 2-5 days by using options (selling OTM Calls and Puts spread) and targeting 1% target gain and 1% stop loss using stock price. The green color should be interpreted as a bullish signal and the red as a bearish signal.
How To Use Our Signals
Once you become a member, I encourage you to review our Live Trading Room recordings to see how I trade Aggressive Power Trader signals in my account. A snapshot of how we produce our Live Trading Room Sessions shows how we pack in a lot of information that can be accessed from whatever device you’re driving.
As a reminder, consider buying near the "BUY" level with a "10 days prediction" higher than the close price. In our live trading room, I usually hold a position for 1-2 days.
I allocate less than 5% of my portfolio if the position is being held overnight. On average, less than 1% of the portfolio should be at risk if you own a position for less than one day.
I enter a position at the predicted LOW (BUY) price or yesterday's close price. My stop loss is 1% and my target gain is 1% of the stock price. I target 75% accuracy using these signals.
A few subscribers asked about Options trading using the signals provided. Please review live trading room recordings. I often sell OTM credit put spread using weekly options and collect 0.5% using stock price. For example, if the stock is trading at $100, I would sell an OTM Put (strike less than 100) with an option BID price close to $0.5.