Bank ON America!
Bank ON America!
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.
The rolling correction has worked its way through most of the 11 market sectors, with REITs, utilities, healthcare, consumer staples and energy in their own bull markets. The narrative of the Fed having to take more hawkish actions to tamp down inflation has traders moving toward the mindset of a pending hard landing for the economy.
The notion of a global slowdown is taking hold the longer the war in Ukraine goes on, the 45 cities in China that are either in full or partial Covid-related lockdown and the ongoing supply chain constraints that are keeping prices of goods and services elevated. The effects are being felt much more outside the U.S. than here at home.
Bond yields have also moved up to levels not seen since 2018 after Fed Chairman Jerome Powell telegraphed a 50-basis point hike at the upcoming May 4 FOMC meeting. The market is more convinced a 75-basis point increase is coming. Adding to the angst, the yield curve inverted Wednesday, where this trifecta of negative news for bonds spilled over into the equity markets triggering a major downward reversal.
To the bullish camp, the labor market is very tight, wages are up and spending is healthy. If inflation is peaking, then a lot can change for the good very quickly. Traders will get several economic reports and high-profile earnings releases next week that will help determine if the market has overreacted to the downside. And we have to remember that roughly 70% of market volume is attributed to high-frequency trading tied to algorithms that trade off of headlines and technicals rather than fundamentals.
CURRENT TRADING LANDSCAPE
The week closed out on a solidly negative note after bond yields rose sharply. The $SPY broke short-term support at $441. The value/reflationary ($VTV) closed lower 1.0%, at $147, failed at to break the all-time highs. The technology sector ($QQQ) trades lower by 1.5% at $329, below the 50 DMA and the 200 DMA.
The $DXY trades higher to the $101.3 level and breaking above the March 2020 high. The $TLT trades lower by 0.7%, at $120, and below the July 20219 lows. The ten-year yield closed higher at 2.95%, retesting 4-year highs. The $VIX trades higher near the 26 levels, above the historical average.
The $SPY short-term support level is at $435 followed by $420. The SPY overhead resistance is at $447 and then $451.
Assuming the geopolitical risks in Ukraine have reached the status quo, it is reasonable to assume that the $SPY February low is set and the pattern of higher highs and higher lows will continue in the next two to six weeks.
I would be a buyer of the low beta stocks into the pullbacks and have a market BULLISH portfolio at this time.
I do not expect the $SPY to post new all-time highs in the first half of this year. There is a high probability that the $SPY main long-term support at $415 is now set but might be retested in the next few months.
The "BUY" signal based on the Aggressive Power Trader Portfolio for tomorrow is at the $434 level using SPY and the "SELL" signal is at $450 for short-term traders.
If you are trading options, consider selling premium with July and August expiration dates.
Based on our models, the market (SPY) will trade in the range between $415 and $470 for the next 2-4 weeks.
NEW EARNINGS POWER TRADER SERVICE
We recently launched our new Earnings 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.
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.
Signals have historically averaged over 85% accuracy in my live trading since inception. Sometimes we hold position 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.