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.
Sometimes just because the calendar tuns over to a new year, there are implications that all different sorts of developments will take shape to influence the stock market in both a positive and negative way. From what is known and unknown heading into 2021, I would venture to say that traders should expect more of the same.
When I mean more of the same, it translates to the Fed all but guaranteeing to let the market endure any kind of material decline, Congress spending hundreds of billions more dollars on pandemic and infrastructure stimulus, the dollar depreciating further, bond yields ticking higher, commodity prices increasing, gold and bitcoin continuing their rally and emerging markets leading a global reflation trade.
Collectively, this is a very bullish backdrop for the trading environment and if we do see the market react negatively from the Georgia election runoff, it will in my view, only create a very attractive buying opportunity that would be a welcome consolidation of the heady market gains realized in the past two months.
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
You can’t keep a good market down. The SPY continued to make incremental gains. All asset classes rallied into the long holiday weekend except mega cap technology stocks (AAPL, MSFT, AMZN). The SPY $364 level is the key support level short term. The U.S. Dollar and the Treasuries continued to trade in the downtrend.
As long as the SPY is trading above $364 level, the SPY will continue to make incremental gains and can reach $375-$380 level by mid-January 2021. There are some technical signs the bulls are losing some short-term momentum as seen by some rotation out of the hottest growth tech stocks and sizzling IPOs that had captured the fantasy of traders all years.
The market is prone for 5-10% garden variety correction in January-February. At the same time, the bull market will resume its rally and continue to make new highs into March-April. 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 March and April expiration dates.
"BUY" signal based on the Aggressive Power Trader Portfolio for tomorrow is at $370 level using SPY and "SELL" signal is at $374 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 the 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 predicted LOW (BUY) price or yesterday's close price. My stop loss is 1% and my target gain is 1% of 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.