Vlad's Trade-of-the-Month: DE-lightful

Published Mar 9, 2021

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 ferocious reopening rotation picked up speed this past week, with high-beta stocks getting sold off aggressively in favor of money flowing into deep cyclical, value and energy sectors. The market was going through the equivalent of a wash cycle in the latter part of February and now the pure growth stocks are going through the rinse cycle that will culminate when they go through the spin cycle that is now unfolding.

The change in sentiment has been stunning. Stocks like Tesla Inc. (TSLA) that characterized the meteoric rise of ETFs like the ARK Innovation ETF (ARKK) are getting sold off to the tune of 30%+ in just the past two weeks. Many stocks very priced to perfection, the market absorbed some of the biggest IPOs in history like Airbnb Inc. (ABNB), Snowflake Inc. (SNOW), Palantir Technologies Inc. (PLTR) and Door Dash Inc. (DASH), among others.

As the market got too extended, the potential for a sizeable pullback grew with the notion of a massive stimulus plan that fueled inflation sentiment that pricked the Nasdaq bubble – and now some air is being let out. The market is going to return to its bullish ways once this corrective process has run its course, and traders that are in sync with our Weekly Power Trader service will make a lot of money when the market turns.

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

So, I literally ran to tell you this. My daughter needed a driving permit, so I obviously dreaded going to the DMV. This dates me, right? OK, the Secretary of State’s Office. I received an email from her driving school that you now needed an appointment to even enter the DMV, so I tried to make one, with no appointments available.

But do not fret. I quickly figured out that the new appointments open up at 8 am and slowly disappear throughout the day, however, on Tuesday, I was able to make an appointment for Thursday, at any time that I pleased. We showed up at the DMV at the appointment time of 3:40 and it was like I died and went to heaven. No chairs, no crazy lines, efficiency like I haven’t seen since my trip to Japan.

Explaining my excitement to my 15-year-old was no joke, she looked at me like I was nuts and I had to be really mature and say “well, have you been here before and seen what this was like, no, so there.” We were in and out, including her actually taking the permit test, in 45 minutes!!!! OK now, I cannot believe it took a pandemic for them to finally come to their senses and do this, but run to get your real id, in case they change their minds.

The SPY sold off precipitously across all asset classes except the Energy (extreme volume in QQQ and extreme level for VIX). Short-term, the SPY range remains between $368 and $395. The SPY is reaching extreme oversold levels and QQQ reached a support level that dates back to September 2nd. The DXY rallied after Powell's speech (reason values stocks sold off). The TLT is in the process of building a bottom.

The bottoming process has started and the worse part of the sell-off is now behind us. The market will finish the bottoming process in the next two weeks and will resume bullish momentum by the end of March.

I would be a buyer using any short-term corrections and use dollar-cost averaging strategy to accumulate positions. If you are trading options consider selling premium with April and May expiration dates.

"BUY" signal based on the Aggressive Power Trader Portfolio is at $375 level using SPY and "SELL" signal is at $389 for short-term traders.

Based on our models, the market (SPY) will trade in the range between $368 and $395 for the next 3 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.

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SECTOR SPOTLIGHT

As the correction runs its course, it is imperative for traders to take notice of where the market will direct its attention against the evolving trading landscape. That means looking to buy and trade cyclical and value stocks from the long side. Particularly, industrials are most likely to emerge as the favorite go-to sector where opportunities for trading profits are most significant.

The Industrial Select Sector SPDR ETF (XLI) is the best way to trade the sector for those wanting to leave out the stock-picking aspect of trading industrials. The top ten holdings in XLI make up 41.77% of total assets with the bluest of blue-chip stocks as the leading components.

Applying our proprietary AI platform to XLI, the Seasonal Chart has XLI looking very bullish for the next 10 and 20-day periods following this swift correction. Our data goes back to 1998 when measuring XLI, which carries an 85% Correlation, making it a very strong candidate for us to trade when our signals flash to do so.

Shares of XLI broke above a key resistance level in February, trading to a new all-time high of $95 before pulling back to the 50-day moving average that should provide for an attractive entry point, assuming the broader market doesn’t take another leg lower.

We’ll be looking to utilize XLI within the Weekly Power Trader service as our indicators dictate. Make sure to be a member so as to not miss out on the next trade we make in XLI and consider heavily to let us guide you through this trade if and when we put it on in what is a heightened landscape of volatility.

TRADE OF THE WEEK

Of the industrial stocks that stand out year-to-date, it’s hard to find one that compares with Deere & Co. (DE), a global farm and heavy machinery powerhouse. The company operates through three segments: Agriculture and Turf, Construction and Forestry, all of which are humming on all cylinders as the global reflation trade picks up steam.

Source: Pinterest

Global agribusiness is turning up fast and it showed up in Deere’s glowing fourth-quarter results that blew away estimates. The company posted earnings of $3.87 per share versus estimates of $2.06 and guided the Street higher for 2021.

When we plug in DE to our AI platform, we also get a very bullish readout for the next 10 and 20-day periods that bode well for those looking to trade the leading name in the industrial sector.

From a purely technical perspective, shares of DE got extended and have consolidated of late, pulling back to a rising 20-day moving average where we will consider getting our subscribers involved.

This is a very bullish set of trading parameters for which traders can be confident in trading DE from the long side, and makes for a primary candidate for Weekly Power Trader subscribers.

This is what our precision AI platform does for our members. It identifies, clarifies and verifies high-quality trades. By being a member of Weekly Power Trader, its these kinds of opportunities that our AI-driven platform provides our members to look forward to every day they put their risk capital to work on both long and short positions.

Our Weekly 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 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 look to enter a position at predicted LOW (BUY) price or yesterday's close price. For Weekly Power Trader, my stop loss for stocks is 2% and my target gain is 2%. . I target 75% accuracy using these signals.

Through the Weekly 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.

The beauty of our AI-driven system is that we are always equipped to bring new trades to our members. Trades in best-of-breed stocks and ETFs that are not yet recognized by the larger universe of traders. In just the past two weeks, our Weekly Power Trader members have booked profits in every single recommended trade for February.

Below is a table showing most of the torrid streak of 18 out of 19 winning trades closed in just the past two weeks. This is a compelling winning record by any measure and should offer those readers of this blog a strong incentive to join as a new Weekly Power Trader member and put our trading system to work right away.

We really pride ourselves on this kind of discovery process, to bring trades with very high probability risk/reward parameters to members throughout each week. Our track record speaks for itself from a standpoint of a Winning Trades Percentage, Average Return Per Trade and Net Gain.

The consistent performance of our Weekly Power Trader service is just incredible. This stellar performance is made possible by being right on 86.59% of all trades with an average profit of 34.23% per trade. Retail investors will not find this kind of track record available at an affordable price anywhere in the marketplace for trading services.

Once you’ve become a member to any of our service – Weekly Power Trader or Aggressive Power Trader, I highly encourage you to view the instructional videos on how to best use your membership and participate in live weekly strategy roundtable workshops that are also archived in the event that they need to be viewed at a later time.

Traders seeking the most-timely directional trading strategies where over 86% of all trades are profitable should take action and come alongside the Yellow Tunnel community and make Weekly Power Trader and Aggressive Power Trader your go-to AI trading platform for no-excuses performance.

Our AI platform crunches all the data, generating a constant stream of trades with the highest probability of generating incredibly profitable returns available to beginning, retail and professional traders anywhere in the marketplace today.

Go to our website at www.yellowtunnel.com and make the Weekly Power Trader service your default trading system where the AI that powers my all-world, always thinking platform and make 2021 the best year on record for your trading portfolio.