Hi everyone and welcome to the Yellow Tunnel community, an aggressive short-term trading service dedicated to all classes of traders seeking to elevate their trading skills, market awareness and trading profits.
A good week was had by the perennial growth stocks that came quickly back into fashion after bond yields leveled off and declined over the past few sessions. Friday’s strong PPI reading, the second-highest on record, stemmed the buying into bonds, but the 10-yr yield only rose by 23 bps to 1.65%, a tepid move considering the headline.
The broadening out of the market is healthy in that most of all market sectors are participating and providing upside momentum when overheated sectors need time to consolidate. This kind of wide-ranging participation keeps the bull trend intact as earnings season unfolds in the week ahead.
CURRENT TRADING LANDSCAPE
The same boiling water that hardens the eggs, softens the potato. It’s not about the circumstances, it’s about what you do in those circumstances. Learn from your mistakes. Keep journaling. Take your time. Review your end game. Circumstances might be the same, but your actions and reactions can yield totally different outcomes.
The SPY is consolidating before the next move up. As long as the $SPY is trading above the $397 level the path of least resistance is to the upside. Technology stocks continue to lead the market. Value stocks currently overbought and started their pullback from overbought levels.
April should be a strong month for the equity market and our model projects a $410-$420 level by the end of April. The $DXY continues its move to the downside. The TLT continues to trade in the range.
The earnings season will start next week with (JPM, TSM, GS) scheduled to announce their earnings next week. I would consider raising cash at this point as the best part of the recent rally is behind us. If you are trading options consider selling premium with May and June expiration dates.
"BUY" signal based on the Aggressive Power Trader Portfolio for tomorrow is at $407 level using SPY and the "SELL" signal is at $412 for short-term traders. Based on our models, the market (SPY) will trade in the range between $388 and $420 for the next 6 weeks.
NEW WEEKLY DYNAMIC POWER TRADER SERVICE
We recently launched our new Dynamic Power Trader service that we at Yellow Tunnel are 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.
What makes this new service so special is that it offers real-time alerts via SMS and access to Vlad's live positions and order. 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.
Our Weekly Power Trader service continues to power up great trading profits. Each week on Sunday, 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.
Also, note that the Weekly Power Trader signals are meant to last for 5-10 days as long as the vector confirms the same direction as the original pick, for stocks we use a target gain of 2% and stop as 2% of the stock price.
Signals have averaged over 75% accuracy in my live trading since inception. Sometimes we hold position 2-5 days by using options (selling OTM BULLISH PUT spread) and targeting 1% target gain and 1% stop loss using stock price. The green color should be interpreted as a bullish signal and r ed color 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 stock price. I target 75% accuracy using these signals.
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 OTM put (strike less than 100) with option BID price close to $0.5.
FANNG made its way back into the spotlight as this powerful set of heavily market-weighted stocks emerged as the go-to target of fresh fund flows. I like to call it FAANG plus Microsoft because MSFT is such an important component of the tech sector.
With the focus back on big-cap tech this past week, traders that want to spread their risk across the sector should consider trading the Technology Select Sector SPDR ETF (XLK) as an excellent basket of top tech stocks with most just emerging from multi-month basing formations.
The one-month chart shows XLK has made an explosive upside breakout move, where the next pullback should provide traders an excellent long-side opportunity. Either the gap created underneath will be filled, or similar to the last breakout will trade laterally until the 20-day m.a. catches up with the stock.
That’s a very impressive chart and one that we’ll consider adding to our daily trade recommendations for Weekly Power Trader subscribers. The rising number of users of cannabis products and the momentum of future legislative deregulation of weed will also play a big part in the upward trend of the sector near-term.
At Weekly Power Trader, we apply our custom proprietary AI algorithms to every trade, giving us a serious edge on how and when to trade stocks and ETFs.
Shares of XLK offer traders a lower-risk method by which to trade a sector that has demonstrated a high level of volatility in the first quarter of 2021. Trading the ETF removes single stock risk and yet XLK has shown it has strong price action that makes for an exciting trading vehicle.
TRADE OF THE WEEK
When it comes to the favorite FAANG stocks in the current market landscape, most views are centered on Alphabet Inc. (GOOGL).
The search engine giant with burgeoning divisions in Chrome, Android, YouTube.com, Google Cloud, Google Maps and Other Bets is a force to be reckoned with. For a company its size ($1.5T market cap), it has a stellar revenue growth rate of 23% this year, estimated at $227B, with earnings forecast to come in at $70 per share, up 20% over 2020.
After posted strong Q4 results in early February, and trading to new highs, the stock consolidated for the past two months, and has recently begun a new leg higher.
When we apply the Forecast Toolbox to GOOGL we also get a bullish read on the forward prospects for the stock. Our AI model is predicting a powerful move higher to $2990 by September. That’s a powerful intermediate move higher from its current price of $2250 and presents a solid trading vehicle for traders to work with on a steady basis.
Such a terrific future in the making for the stock makes GOOGL an excellent candidate for Weekly Power Trader subscribers when our AI indicators give us the right set of parameters to trade off of.