Vlad's Best Trade: Short Circuit QQQ
Hi everyone and welcome to the Yellow Tunnel community, a family of trading services dedicated to all classes of traders seeking to elevate their trading skills, market awareness, and trading profits.
September is upon us, which means Q3 is coming to an end and the next Federal Open Market Committee meeting is right around the corner. Last week, Fed Chair Jerome Powell's comments at the Jackson Hole Economic Symposium sent shockwaves through the markets as the Fed reinforced what many expected: interest rate hikes will continue and the Fed will do anything within its means to fight inflation. Most of the week was spent reacting to the announcement, which shifted market sentiment and triggered several selloffs.
As we continue feeling the response in the market to the marquee event, I am reminded that while we are always connected to our past -- be it reacting, reflecting, or rejecting it– it is more important to be aware of what's ahead.
What's ahead in the market is the latest employment data, the latest Beige Book, and additional inflation reports. What's ahead at home is a much-needed trip and reset.
Over the Labor Day holiday, my wife and I, as well as a group of close friends, headed out to Croatia. While summer was filled with activities for the kids, as we sent them off to school, and before fall really kicked into gear, we decided to take a trip to somewhere we've always discussed.
Beautiful vistas, a unique culinary experience, and quality time with lifelong friends were just what the doctor ordered. We made plans to jet ski, sightsee in Split and Zagreb, and, what we were looking forward to the most, truffle hunting!
As I kept my focus on the market this past week, I was also looking ahead to spending this time overseas with friends I've had since high school. Our group friends, which have been together for over 20 years, have built up many memories and strengthened connections, and continue to do so every year!
I've made it a priority to stay in touch with them, and feel lucky that they did the same with me! As I grow older, I realize how hard it is to make new friends, and even how easy it is to lose them. Having this trip with people I've known since my teens reminds me of the power of compounding investment -- something I strongly believe in with trading.
Over the years, we've stacked experiences into each other's lives just like a disciplined trader would with their profits. We've done it so long that it's pretty much second nature, and with any good discipline, it's important to maintain it and tend to it. During this trip, we will strengthen the connections we have with each other and add to our "investment."
This type of discipline is key for maintaining friends over such a long period of time as well as trading during volatile times, which is exactly where I believe the market is headed. If you are a patient and disciplined trader, even in volatile markets small incremental investments can be made, and large cash positions can help you safely grow your portfolio.
This is something we addressed in my latest roundtable webinar, hosted every Thursday on YellowTunnel. Trying to keep up with the market by yourself can be overwhelming. That is why I encourage you to join a trading community where you may interact and analyze with others. I recommend checking out our latest Roundtable webinar in its entirety below:
How To Trade a Bear Market Strategy Roundtable
With the unpredictable nature of the market and the uncertainty ahead of us, I can’t emphasize enough how vital it is for our readers and members of the Yellow Tunnel community to keep referring to our Live Trading Room so as to maintain a close tie of how our I and my AI platform is navigating us in and out of select trades. It’s FREE and I highly encourage everyone to sign up to the Live Trading Room and keep checking in throughout the trading day.
Every Monday and Wednesday, I highlight our best strategies and potential trading setups via the DISCORD server. It’s the future of bringing together a trading community’s total services, educational products, live chat venues, support, news, how-to tutorials, webinars, live-trading demonstrations, and tons of market analysis. It is incredibly interactive and full of crucial and timely information. Just go to:
I also want to emphasize to traders how vital a stop-loss discipline is to winning and being successful in an unforgiving market. We employ specific stop-loss instructions with every trade. The buy and sell programs controlled by high-frequency related algorithms can create great profits or cause sudden losses, so it is imperative to maintain an element of controlling risk with each trade.
CURRENT TRADING LANDSCAPE
This week, employment data dominated financial discourse as a bevy of labor reports were released. August concludes with all three major U.S. indices booking losses as shares continue to sell off to start September.
On Wednesday, ADP data showed the U.S. private sector added 132,000 jobs in August, which was a steep decline from July. Then, on Friday, after initially moving higher on the news that August's job report showed the U.S. economy added 315,000 new jobs last month, which is roughly in line with expectations of 318,000 jobs, stocks lost ground later in the afternoon.
Also, on Friday, the latest monthly employment report was released which showed rates rose from 3.7% to 3.5%, making it the highest jobless rate in six months and matching a 50-year low last seen pre-COVID in 2019. Hourly pay moved 0.3% higher in August while the rise in pay over the past year stayed at 5.2%. The Fed will certainly take these levels into consideration during their upcoming Fed meeting, scheduled for September 21-22.
The volatility index traded as high as $28 level this week, likely continued reaction from Powell's Jackson Hole comments, but concluded the week around $25.
On Friday, the $SPY closed 0.78% lower, at $393, booking a 2.31% decline for the week. The technology sector ($QQQ) closed lower by 1.49%, at $294, trading above its 52-week low. The $DXY closed lower, near the $109 level.
The $SPY short-term support level is at $390, followed by $380. The SPY overhead resistance is at $406 and then $417. I expect the market to continue the current pullback for the next 2-8 weeks.
I would be a seller into any further rallies and encourage subscribers not to chase the market at these levels. See SPY Seasonal Chart below:
Looking at the levels listed above, I expect a short-term relief rally to pop up somewhere in the next 2-3 weeks since the market retraced 50% of the June-August rally. The bear market should resume its downward momentum into the end of this month and the beginning of October and there is a high probability to retest or marginally break this year's low.
As I've previously stated, the dollar's rebound from the recent pullback supports the notion that the previous rally has come to an end. All eyes will now be on the upcoming CPI data set to release on September 13th and then the FOMC, which will follow. Market sentiment is expecting a 0.5-0.75 basis point rate increase during the September meeting.
As market participants come back from their "Croatian" end-of-summer trips, I expect market volatility to resume and volume to increase.
NEW EARNINGS POWER TRADER SERVICE
I recently launched our new Earnings Power Trader service, which I am very excited about. Each week, 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.
This new service is special because it offers real-time alerts via SMS and access to Vlad's live positions and orders. When I put together this system, I wanted to be in the fight with other investors. That’s why I don’t play on your emotions to sell newsletters - I put my money where my mouth is.
Every trade recommendation that I make using this system – comes straight from the list of trade recommendations I use myself.
Not only that but every trade I make is logged in detail for you to review at any time. You can see my entire trading history, updated LIVE so that you can see, learn from, and even copy my trading strategy. Click here to learn more.
Signals have historically averaged over 85% accuracy in my live trading since inception. Sometimes I hold positions for 2-5 days by using options (selling OTM Calls and Puts spread) and targeting 1% target gain and 1% stop loss using stock price. The green color should be interpreted as a bullish signal and the red as a bearish signal.
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 Earnings 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 you’re 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 entered 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.
A 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 an OTM Put (strike less than 100) with an option BID price close to $0.5.
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Dear Skeptic,
Inflation, War in Ukraine, global uncertainty, and the COVID-19 pandemic have turned our world - and our markets - upside down.
As a trader, I have seen these events as opportunities.
I spent years building a sophisticated, proprietary trading algorithm that would be immune from overall market performance - and the current market conditions are no exception. To read more click below…
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SECTOR SPOTLIGHT
With the market having started its next leg down following the latest employment reports, marginal lows could be seen in the September-October time frame. With mega-cap as a leading indicator of market direction, there is one particular sector that could buck this trend during the likely period of volatility upon us. Having traded in this sector previously, there are a handful of trends that are making this a must-buy now!
As we've seen, the tech started to sell off and show weaknesses as August concluded. Apple, and specifically the QQQ, sold off. For all intents and purposes, the bear market has resumed.
Oil and commodities have pulled back. U.S. regulations regarding Chinese companies and COVID lockdowns in China are pressuring global markets. U.S. regulators will start auditing U.S. listed Chinese symbols, which could spark the FXI, the leading Chinese index, to outperform U.S. markets going forward.
Taking that into consideration, I am looking at shorting major tech ETFs. Chip makers sold off following the U.S. regulation announcement on Chinese companies. The lack of earnings and additional kick-starters for the market will enforce the pressure the tech sector has already witnessed. If that is the case, shorting ETFs like the S&P 500 with $SH is exactly the type of trade I am looking for.
My A.I. tools, along with my reading of the market, have brought me to one particular symbol to double down on as a way of hedging upcoming volatility.
TRADE OF THE WEEK
There are several short ETFs I have had an interest in in the past but for the upcoming period of volatility, I'm squarely looking at one symbol to short this specific sector. This unique opportunity lines up with our reading of the market and the trends my A.I. arsenal has been recently signaling.
If the bear market resumes, expect tech to see substantial moves lower. To profit from this, there is one symbol that should easily move higher during the volatility: ProShares Short QQQ ETF (PSQ.)
PSQ is the QQQ's inverse ETF which seeks to profit from the daily performance of the Nasdaq. Currently trading at $13.55, this ETF is trading between its 52-week high and low of $15.05-$10.63. The symbol has built some momentum in moving higher in the past few sessions and if my reading of the market is correct, with continued selloffs and volatility as the bear market resumes, then this inverse ETF is primed for a great month. My proprietary A.I. tools are signaling just the same.
Looking at the 10-day Stock Forecast Toolbox predicted data, we see a similar reading that shows the potential for this symbol to grow. PSQ holds a model grade of “A” and shows a strong and consistent positive vector trend in the upward direction. The symbol is still trading below our predicted high level of $13.77 and could easily extend past the predicted high in the weeks to come.
Looking at my Seasonal Chart, I am seeing positive signals for PSQ right out of the gate! The symbol is seeing mute forecast and accuracy percentages which show a symbol set to buck its latest trends. Just this week, the annual seasonal prices, seen by the green line, swapped places with the current price, portrayed via the blue line. This is a trend that could send shares higher as QQQ continues to sell off. See PSQ Seasonal Chart below:
Volatility is due to shake markets. Technical indicators are pointing at a sell-off and tech has displayed kinks in its armor. If the bear is to continue, there is no better spot to short than tech via the inverse QQQ ETF: PSQ!
This week, I’ll be adding PSQ to my portfolio as a strong hedge against volatility.
This is precisely where AI technology comes in handy. We connect our Live Trading Room to YellowTunnel in an effort to assist you in managing the current inflationary trend. We keep our positions updated on a regular basis and our AI system seamlessly integrates with our platform to give our customers the most comprehensive trading experience available today.
The beauty of our AI-driven system is that we are always equipped to bring new trade ideas to our members. Trades in best-of-breed stocks and ETFs that are not yet recognized by the larger universe of traders.
And our track record speaks for itself from the standpoint of a Winning Trades Percentage, Average Return Per Trade, and Net Gain.
The consistent performance of our services is just incredible. My historical stellar performance is made possible by being right on 84.76% of all trades that I made, with an average profit of 37% per trade on our collective trade recommendations. To my knowledge, this trading performance is one-of-a-kind that stands alone in the marketplace for superior trading advice where our numbers and results speak for themselves.
Traders interested in the most-timely moving trading methods, where previously nearly 85% of all my trades were profitable, should join the Yellow Tunnel community and utilize one of our AI trading platforms for no-excuses Trading.
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Go to our website at www.yellowtunnel.com and make one of our services your default trading system where the AI that powers my all-world, the proprietary platform, can help you make 2022 the best year on record for your trading portfolio.
Have a fantastic week, keep Ukraine in your thoughts and prayers, and let's make some great money together.