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.
Market conditions are getting more complicated as the second quarter comes to a close and volatility rises to reflect new uncertainties. Against this more difficult trading landscape, my team provided traders daily insights, succinct trading strategies, ongoing education and coaching to elevate our collective knowledge, instincts and provide a top-end trading experience for all our members.
NEW OPTION FEATURE FOR PAID SUBSCRIBERS
We recently launched our new Option Portfolio for paid subscribers to Aggressive Power Trader. This expansion of our service brings a major offering of quick-hit option strategies to our audience that thrive on trading options. We offer specific option trades of what our AI tools generate. All traders need to do is execute per the parameters set forth in the table of instructions.
Each day (8 PM and 8:30 AM CST), our expert traders use YellowTunnel Tools to provide the Top Bullish, each with an Entry Price, Target Profit, and Stop Loss. Please note, that it is possible to hit the Target multiple times throughout the trading day, so you can trade the same stock multiple times using the same entry price.
Also note that signals are meant to last for 1-2 days as long as vector confirms the same direction as the original pick. In live trading room, we use target gain as 1% and stop as 1% of stock price.
Signals have averaged over 75% accuracy in live trading account. Sometimes we hold position overnight 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 bullish signal and Red color as bearish signal.
Sign up today and get in on the next set of trades due out early next week!
CURRENT TRADING LANDSCAPE
SPY was able to hold on to 200 day moving average and close at $307. Value stocks continue to underperform and are retesting last week’s lows. The short-term bottom is at $293 and potentially can be retested this week or next. SPY longer term overhead resistance is at $323. Market is oversold and SPY is trading at 200-day moving average. Market correction of 10-15% can start in the next 1-3 weeks. At this point I am reducing my exposure to the market.
I expect the market volatility and the two percent daily market moves to persist. SPY top is set at $322 and market can potentially retest this level in the next 1-2 weeks. Market can overshoot support and resistance levels when VIX is elevated. Short term support is set at $293. My strategy is to buy 10-15% market corrections.
Based on our models, the market (SPY) will trade in the range between $275 and $330 for the next 4 weeks.
The sudden shift to a risk-off trader sentiment was sparked not only by a spike in coronavirus caseload, but also concerns that the massive amount of government stimulus will fall short of re-energizing the economy back to pre-pandemic levels any time soon. As such, there is a lot of talk of $1-$3 trillion in additional stimulus that will be passed and implemented in the weeks and months ahead to address the situation.
The surge in debt creation has pressured the dollar lower to levels where a break below 96.0 would open the way for a move lower to 94.0 and then ultimately 90.0. Such a technical violation will likely put a bullish bid under the gold and gold miners sectors as a natural reaction that has a long history or correlation.
As this trade looks to come into view, one of my favorite ways to play this set up is with the VanEck Vectors Gold Miners ETF (GDX). There are two camps in the gold trading world; one that focuses only on the bullion and the other that argues for trading the gold mining companies. Here are the top 10 holdings in GDX.
A view of our proprietary AI-based Stock Forecast Toolbox gives GDX and “A” Model Grade rating with a 10-day price target of $37.16 representing about a 10% gain in what I consider a very high-quality trade.
It’s a compelling set up for aggressive sector traders to take full advantage of per my buy signals to maximize optimal entry points. I’ll be looking to trade this sector for those that want to trade on our signals within our Aggressive Power Trader advisory service.
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94% Meltdown Batting Average!
My trading algorithms found winning trade after winning trade. As of this writing, my total batting average since the meltdown is an astounding 94%.
(That’s 47 winners out of 50 -- with winners pulling 15-250% per trade.)
You can get a list of all my upcoming picks.
And it’s easier than you think.
TRADE OF THE WEEK
A resurgence of the coronavirus has trading capital rushing out of economically sensitive sectors and into highly defensive sectors as the week came to a close. I’m seeing strong rotation into some of the consumer staples stocks that offer cleaning and sanitation products, over-the-counter health items and food and beverages.
As a sector, consumer staples made a solid move during 2019, got crushed with the market this past March, and like many other sectors, has been on the mend and trading in a wide range.
As the market favored growth and cyclical stocks during the past few weeks of the “grand reopening” of the U.S. economy and economies around the globe, the consumer staples sector lagged. But with the resurgence of COVID-19 cases sweeping across the nation, money is quickly finding its way back into the kitchen and bathroom stocks.
The best way to trade the sector is through the S&P 500 Consumer Staples SPDR ETF (XLP) where the stock and options are super liquid. Among the top 10 holdings are some very familiar names, with Proctor & Gamble Co. (PG), PepsiCo Inc. (PEP), Walmart Inc. (WMT), just to name some of my favorites. Quite frankly, this top ten list is world class in not just name recognition, but also in financial strength.
The sector doesn’t get nearly the coverage or appeal from the financial media and the investment community that is more infatuated with all things tech-related, biotech related and consumer discretionary-related. However, every sector has its day in the sun and my view is that the sun will be shining down on XLP as the ground shifts under the market landscape.
If the economy fails to live up to growth expectations that have been aggressively priced in during this torrid rally off the March lows, the near-term shift into the consumers staples will morph more into a trend that could provide a reliable place to churn out multiple trades for steady profits during the course of the summer months.
Applying our AI tools, the Seasonal Chart is bullish on XLP for the next 10 days as momentum for the sector picks up speed in the new risk-off landscape.
At its current price of $58, the stock is sitting on key short-term technical support where it should turn higher in the days ahead and challenge $60-$61. Traders should be on alert in that I may be adding this position to our trading portfolio in the coming days.
Our Aggressive Power Trader advisory service takes positions in only blue-chip stocks and ETFs that are “green lighted” by my proprietary AI tools, and when confirmed, are added to the portfolio with my investment capital invested in each and every trade.
In our primary trading service Aggressive Power Trader, I direct our subscribers through the “trade decision-making process” with the mindset of being in and out of trades within 24-48 hours with the objective of booking 30%-60% gains against the amount of capital at risk on each and every trade with 75% accuracy.
The major element of this service is that it provides tomorrow’s featured trades the night before so traders can analyze and work on how they might best want to participate. You get to examine stock candidates well ahead of when I’m going to execute my best ideas the next day. It’s my TOP STOCK watch list of trading candidates with the various parameters that I use to trade each trade with defined risk levels, entry points and projected exit prices.
Each day at 8:00 PM and 8:30 AM CST, we provide our Top Bullish and Bearish Stocks, each with an Entry Point and projected exit price. Our signals are meant to last 1-2 days. Below are actual recommendations with parameters found on our Aggressive Power Trader Watch List.
I’m only showing a few stocks and ETFs that will show up every Thursday evening on our Watch List, so, there are plenty of trading opportunities in stocks, and ETFs to put to work on a daily basis. There are typically 10-12 trading strategies to consider.
I also post details of our trading activity and updates on the Watch List at the bottom section of our daily blog. So, make sure to stay tuned in that service as well.
Trading Thoughts: 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 and allocate no more than 5% of trading capital to any single trade.
I allocate less than 5% of my portfolio if I hold a position overnight. On average, less than 1% of the portfolio should be at risk if you hold a position less than one day. I personally enter a position at predicted LOW (BUY) price or yesterday's close price. My stop loss is 1% and my target gain is 1% of a stock price. I target 75% accuracy using these signals.
Through the Aggressive Power Trader service, we tie our Tradespoon Live Trading Room to manage the parameters of every trade. And we update our closed positions daily. The two platforms work seamlessly to provide our subscribers with the most robust trading experience available anywhere in the market today.
For those that have followed since inception, a $100,000 initial investment when backtested may have grown to over $1.8 million dollars. This stellar performance is made possible by being right on every 3 out of 4 trades with an average profit of 24.84% per trade. These kinds of incredible returns wouldn’t be possible without my decades long and hard work in developing the most advance AI tools available to retail traders.