Vlad’s Red Hot Trade Of The Month

Published Dec 20, 2020

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.

Rising hopes of a broad stimulus package will arrive by next Monday propelled the major averages to new all-time highs. Most sectors are participating in the rally, with technology showing fresh leadership with its heavy index weightings accounting for much of the percentage gains.

NEW WEEKLY POWER TRADER SERVICE

We recently launched our new Weekly Power Trader service that we at Yellow Tunnel are very excited about. 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. Green color should be interpreted as a bullish signal and Red color as a bearish signal.

CURRENT TRADING LANDSCAPE

Wednesday is my allocated me time. Several years ago, I made a decision to take a couple of hours, in the middle of the hump day, every hump day, and dedicate them to, who else, me.

In the beginning, it felt weird. There were millions of unfinished phone calls, unanswered emails, and of course, the never-sleeping stock market. But I fought the urge to cancel and met my friends at the Russian Banya, also known as the Turkish baths, the Finnish sauna or in the words of my wife, a spa. From that point on, I never looked back.

With Covid, I was forced to scale down and have a semi-spa experience in my basement. I installed a portable sauna and have continued to enjoy my three hours of weekly sanity. Things might be happening outside, but in my happy place, it’s peaceful and calm.

The SPY continued to make incremental gains and both QQQ and SPY made new all-time highs. IWM (Small Cap Stocks) staged an impressive rally. $364 level is the key support level short term. I expect short term corrections to be shallow and the bull's rally to continue.

As long as the SPY is trading above the $364 level, the SPY will continue to make incremental gains and can reach the $375-$385 level by the end of this year.

The U.S. Dollar ($DXY) is trading at a two-year low and U.S. Treasuries (TLT) continued to trade in the downward channel. GLD and SLV broke out from the most trading range.

My opinion has not changed. The bull market has resumed its rally and will continue to make new highs in December. I would be a buyer using any short-term corrections, and use the dollar cost averaging strategy to accumulate positions at this level. If you are trading options consider selling premium with February and March expiration dates.

"BUY" signal based on the Aggressive Power Trader Portfolio for tomorrow is at $371 level using SPY and "SELL" signal is at $373 for short term traders.

Based on our models, the market (SPY) will trade in the range between $350 and $385 for the next 4 weeks.

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 which can be accessed from whatever device your 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.

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 stock is trading at $100, I would sell OTM put (strike less than 100) with option BID price close to $0.5.

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SECTOR SPOTLIGHT

Of the many investment themes that are in the spotlight, one of the most compelling is the clean energy proposition addressing the reduction of future domestic and global carbon emissions. Environmental, social and governance (ESG) funds have popped up to help investors capture some of the momentum from this powerful trend.

Of the many choices available within the ETF community for which to approach investing in clean energy, the most widely traded and institutionally favored ETF is the iShares Global Clean Energy ETF (ICLN), which will average over 5 million shares changing hands every day. Below are the top ten holdings that makeup 48.2% of the fund’s total assets.

A couple of these holdings are familiar stocks, while arguably most are not. And that’s what makes it a very compelling ETF because it stands to reason that the underlying top holdings are not crowded trades and are not household names yet within the investment community. This simply means there is room for these stock to trade higher.

Talk about a hot trading sector, shares of ICLN have embarked on a steep up-and-to-the-right angle of pursuit that is one of the most exciting uptrends in the market today. I can see multiple opportunities to trade this powerful trend from the long side within its 10% bullish band – about as ideal of a short-term trading vehicle as one could ask for.

TRADE OF THE WEEK

Of the top holdings in ICLN, most professional traders have a history working with and trading First Solar Inc. (FSLR), one on the true pioneers of the solar industry. FSLR provides photovoltaic solar energy solutions and operates in two segments, Modules and Systems.

The Modules segment designs manufacture and sells cadmium telluride solar modules that convert sunlight into electricity to integrators and operators of PV solar power systems.

The Systems segment provides power plant solutions, such as project development; engineering, procurement, and construction; and operating and maintenance services to utilities, independent power producers, commercial and industrial companies.

First Solar soundly beat Wall Street expectations for its third quarter and provided implied guidance for the year. First Solar said it earned $155 million, or $1.45 a share, in the quarter, compared with $31 million, or 29 cents a share, in the year-ago quarter. Sales rose to $928 million from $547 million a year ago. Analysts polled by FactSet had expected earnings of 63 cents a share on sales of $677 million.