Vlad’s “Pot of Gold” Stock
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.
No complaints from my end this week. Corrections and pullbacks have been short and swift, a very bullish construct to the primary uptrend where a year-end run higher for the major averages looks likely.
Strong optimism of further Fed fiscal support, a pandemic stimulus plan, widespread distribution of vaccines, a forthcoming infrastructure bill and still huge cash on the sidelines (about $5 trillion) is big fodder to keep the bullish fire lit.
JPMorgan’s Chief Investment Officer also put out a 2021 target for the S&P of 4,400 implying a gain of 18%-20% based on the underlying prevailing forces. It’s a solid backdrop and any dip the market might offer from the Georgia runoffs should be used to initiate and add to positions.
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 af 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
During my latest dental cleaning, I was told that I had tooth decay and had to have the tooth extracted. I was terrified; however, the extraction went smoothly and I barely noticed the empty space.
Weeks later I was scheduled for a follow-up, in order to prepare the area for an implant. Without a second thought, I showed up to my appointment, only to be tortured for weeks on in.
I have been dealing with swelling and pain, as well as the side effects of two different types of antibiotics for several weeks. It’s interesting how sometimes we expect the worst, only to be pleasantly surprised, and more often than not, are hit with the worst, when we least expect it. It’s best to always be ahead of the game and prepared for whatever might come your way.
Technology stocks had a quick sell-off in the middle of today's trading session. Both Technology (QQQ) and Value (VTV) stocks are facing major overhead resistance levels. The market is due for a shallow pullback back to the $355 level in the next 1-2 weeks.
The $350 level is key support for the bulls. I expect short term corrections to be shallow and the bull's rally to continue. The market gains have been selective and bullish momentum is deteriorating.
As long as the SPY is trading above the $350 level, the SPY will break out from the current range to the upside and potentially can reach the $370-$385 level by the end of this year.
The U.S. Dollar ($DXY) is trading at a two-year low and U.S. Treasuries (TLT) continued to trade in the downward channel. GLD and SLV have started their bottoming process.
My opinion has not changed. The bull market has resumed its rally and will retest recent highs in December. I would be a buyer using any short-term corrections and use 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 $363 level using SPY and "SELL" signal is at $372 for short-term traders.
Based on our models, the market (SPY) will trade in the range between $340 and $375 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 that 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 the stock is trading at $100, I would sell OTM put (strike less than 100) with option BID price close to $0.5.
The luster of gold is hard to hide when their writing is on the wall. Unlimited issuance of fiat currencies around the world by central banks is putting pressure on most currencies due to burgeoning debt around the world.
The best way to leverage a play on gold is to buy into the gold miners sector, best represented by the VanEck Vectors Gold Miners ETF (GDX). Pound for pound, the gold mining stocks move about 1.5 times higher and lower than that of physical gold itself. So, being a bull in gold at present, I view the gold miners are a better play.
The top 10 holdings of GDX comprise 58.79% of total assets and make for an excellent way to cast a net over the entire sector that includes all the best stocks.
Shares of GDX are building a bottom and are set to trade higher in the weeks and months ahead. Currently, GDX is working off its 200-day moving average, where I expect it to hold and eventually trade up higher off of it. Be sure to be a member of our Weekly Power Trader when we start to move on GDX aggressively!
TRADE OF THE WEEK
One of our trademarks at Yellow Tunnel and the trading services we offer is that we only trade large-cap, blue-chip stocks and the most institutionally traded ETFS. Our AI platform responds best to these high-quality assets and is why this week’s pick is the top holding in GDX – Newmont Corp. (NEM).
Newmont Corp., for lack of better wording, is the “gold standard” of the gold miner’s sector. It stands head and shoulders above the rest of the sector components, boasting a market cap of $47 billion. The company sees very stable production, lower costs and rising demand over the next several years.
In the gold bar production business, that’s a formula for tremendous success. Newmont is forecasting production of 6.5 million ounces of gold in 2021 and an all-in sustaining costs of $970 per ounce. When gold is selling at $1,800 per ounce in today’s market, that’s phenomenal margins for the company and shareholders.
From a technical standpoint, shares of NEM hit a high of around $72 in early August and have pulled back to $60 where I find the stock to be very attractive.
When we apply our AI platform tools, such as our Stock Forecast Toolbox, we see how our AI model is predicting the stock to trade up to $79 over the near-term. A big move over the next several weeks that will provide numerous trading opportunities from the long side. This will be a go-to ETF that can potentially produce outsized trading profits.