Happy New Year 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.
This week, the marketplace seesawed between gains and losses as volume dwindled during 2022's last trading week - resulting in heightened volatility. With turbulence predicted to begin next year as well, the attention of market watchers will be on the latest employment figures and the start of earnings season next week - each with the potential to spark a fresh reaction in the markets. With this in mind, I am eager to carry out a specific trade as 2022 comes to an end and we move into 2023 - more on that shortly!
Before delving into the latest market conditions and the trade I will be adding to my portfolio, I'd like to take this time to reflect on 2022 as a whole and some of the predictions I made to start off last year. Where was I right? Where was I wrong?
Detailed Review of YellowTunnel's 2022 Predictions
While the pros and cons of YellowTunnel can be rudimentary interpreted via our portfolio performance, something I am also proud of, another way I believe YellowTunnel helps most investors is via our weekly and daily workshops. We offer webinars, both long and short, breaking down the current market conditions, how our tools are interpreting them, and where we believe the market is headed next. And as my winning trade percentage speaks for itself, what I would like to highlight and offer additional proof of the performance of YellowTunnel tools are these predictions and market analysis - regularly offered via live or recorded webinars.
To find most of my predictions for the year we are currently wrapping up, one must go back to last December's webinars where I broke down what I thought 2022 will hold. I predicted a strong dollar, a rise in interest rates, and increased volatility. All three came true as the dollar performed well this year, moving steadily higher through the first three quarters of the year, interest rates were continuously increased with several super-sized hikes this year, and volatility ran rampant as the market landscape constantly shifted in 2022. You can see some of these predictions here:
I can't take credit for all that occurred. Volatility spiked due to Fed comments, underwhelming economic data, and recession fears, however, VIX received a big uptick which remained present throughout the year as Russia's attack on Ukraine sent jitters through the market, continuing to have an impact through today. Another factor for global volatility was China's 0 COVID policy, which significantly dropped worldwide demand for commodities and products.
Fortunately, the expectations I had for the year were in line with my predictions and A.I. forecasts as I was able to wield the continuously changing year into a profitable year for myself and YellowTunnel users. Even when the market average struggled (S&P closed the year at -19% and Nasdaq closed the year at -33%), I was able to close the year in the green - and not just squeak by with minimal gains but double-digit gains! See the performance listed toward the end of the blog.
All in all, my market view of 2022 came true. The Fed had to do something to quell inflation and recessionary fears, the dollar was in a great spot to strengthen as shares wobbled, and the uncertainty regarding the political landscape, Fed action, and geopolitical tension spelled a year high in volatility. Taking these in, while reviewing my A.I. toolset I was able to book gains and make the right adjustments throughout the year. I will be looking to do the same this year - and then some! Look out for next week's Power Trading and Markets blog for my 2023 Breakdown and Predictions.
As I've stated, at YellowTunnel, we focus on not only trading-centered ideas but also non-trading opportunities that will offer our subscribers a chance to become more well-rounded and complete traders. In addition to the trading tools and ideas available on our website and during our weekly webinars, we provide other resources that can help supplement your Live Trading experience.
That is precisely why I recommend being part of our YellowTunnel trading community, where you can discuss and dissect multiple trading strategies with others. This is exactly what we did in my latest Strategy Roundtable, which we hold weekly on YellowTunnel. I recommend checking out our latest Roundtable webinar in its entirety below:
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 for 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.
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.
CURRENT TRADING LANDSCAPE
As of Friday, the 5-day chart shows the $SPY was trading 1.09% lower, near $379. Major U.S. indices were mixed on Friday, but trending lower. The volatility index saw an up-and-down week as low volume increased volatility, currently trading near $22.
As the year draws to a close, next week's unemployment figures and the looming end-of-year taxes may hold the key to predicting where the market will go. We are currently monitoring the resistance levels of SPY, which is currently at $390 and then again at $402. Meanwhile, the support for SPY stays put at around $380 and further down to about $370. We expect the market to continue to make new lows for the next 2-8 weeks. We would be BEARISH ON THE MARKET at this time and encourage subscribers to hedge their positions. For reference, the SPY Seasonal Chart is shown below:
After analyzing all the latest news and perusing my A.I. data, I am eager to move forward with a certain trade; however, let us review everything that went down in the market this week before we firmly decide on this position.
This week, share prices decreased significantly as the holiday season drew closer and trading activity slowed down. Low volume amplified market volatility, leading to a noticeable lull in action throughout the working week.
To start off the week, U.S. stock markets faced a rocky patch as their value took a nosedive; Tesla and Apple particularly bore the brunt of bearish trading activity. On Wednesday, investors took a step back to take into account China's recent relaxation of Covid-19 safety measures.
Taking into consideration China's most recent move, there is a real sense of apprehension. There are two possible outcomes - a swell in demand like that of western countries or, on the contrary, immunization levels much lower than those found in western nations and healthcare services that have reached their maximum capacity due to the dubious efficacy of COVID-19 vaccinations.
The impact of this move has already been seen with stocks like Tesla taking a hit - factories are shutting down due to the rise in COVID cases, and Tesla is in freefall due to a drop in demand from China and the US. Will this be a reflection of what the rest of the companies related to consumer spending will experience? This uncertainty caused stocks to plummet and trading volume was lower than expected which further drove down prices. Simultaneously, bond yields rose exponentially in response.
The sharp rise of bonds has had a detrimental effect on equities. On Tuesday, the yield on 10-year U.S. Treasury notes spiked to its highest level since mid-November and continues to remain above 3.8%. With interest rates edging higher and the 10-year yield breaching 3.5%, a crucial long-term support level, it is likely that we will see further dollar devaluation in the near future. As macro data forecasts are outperforming expectations, I am confident that by 2023, this rate shall drop to 2.5%.
We had a down year in both bond and equity markets. Historically, we had only a couple of occurrences when both bond and equity markets were down two years in a row. In the upcoming year, most likely the bond market will have positive returns due to inflation numbers reaching a plateau and showing a downward trend on a monthly and year-over-year basis.
Despite uncertainty in the equity markets, it is likely that we will reach our lowest points during the first six months of this year. The primary factor contributing to this forecasted volatility is a probable downward adjustment of S&P 500 revenue figures that are not currently taken into consideration when viewing current market performance.
Just this week, AAPL broke 52-week support and was in free fall. I believe the markets will follow the AAPL stock direction in January. Anticipating this trend, I have already identified a few symbols that I will be trading and shorting. Not only am I looking to short tech giants like Apple or Meta which are currently exhibiting some signs of weakness, but also inverse ETFs meant for day market performance in specific ETFs and sectors. When it comes to inverse ETFs, I am confident this ETF is capable of outperforming the market during this anticipated bearish trend.
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Since January 1, 2020, I have had an 85% winning batting average with 1463 profitable trades.
Inflation, interest rate hikes, looming recession, the 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. The more the market moves in either direction, I crank up my trades.
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…
(A portion of Yellow Tunnel sales will go to directly help the Ukrainian people)
Market research shows this year has been particularly hard on investors. After a detailed review of the market landscape post-2022, it appears not many retail traders and institutions were able to maintain significant gains. At YellowTunnel, we pride ourselves on our performance and transparency. And as we have all year, we will continue using our A.I. and additional market research to spot winners. To start 2023, I think I have just the symbol and sector for that!
ProShares Short QQQ (PSQ) is the perfect symbol for traders to take advantage of the current state of the Nasdaq 100. This inverse ETF enables you to maximize your returns during market sell-offs, offering an effortless approach to shorting the tech sector. Lately trading near $15 per share, PSQ has recently retreated after reaching its 52-week high making it a great opportunity considering our reading of the market going into Q1 2023.
When we apply PSQ to our AI-driven Forecast Toolboxfor the near term, we get a Model Grade “B” rating with a Predicted Resistance price target of $15.00 which is right above where PSQ currently trades. At $14.9, PSQ is trading in the upper range of its 52-week range of $10.71-$15.63 – selling off Thursday only to impressively rebound on Friday!
Examining the symbols projected data, we can observe an optimistic development that progresses steadily and positively after a series of up-and-down intervals. Looking at PSQ's vector trend, I am seeing an encouraging trend towards the upside which remains steady in the back half of the forecasted PSQ data. With this powerful, positive trend clearly defined within just days, PSQ is likely to experience revenue gains as soon as next week!
With the increasing possibility of a bear market, now is an ideal time to invest in $PSQ. After carefully analyzing data from various markets and utilizing my A.I. toolkit for consultation, I am certain that PSQ will experience a surge to kick off 2023!
And if that is the case, let's double down and look for the ideal symbol in the tech sector to short as we anticipate a bearish start to the year.
TRADE OF THE WEEK
As we start the new year, one of my top trades for this week is to take a short position on Meta Platforms!
Meta Platforms (META) is a staple within Nasdaq which offers Facebook, Instagram, as well as VR and other services. With the holiday rally firmly behind us, markets have resurfaced at their lows and are potentially forming new support levels. Technology stocks have been especially hard hit with Meta's current position exemplifying a heightened vulnerability during this downturn.
If a bear market is to take control at the top of 2023, look for tech stocks to bear the brunt of the burn while symbols like Meta will see heightened pressure and likely sell-offs. While the current market conditions are lobbying for such a fate for Meta, let's review our A.I. models to see if they agree.
At $118, Meta is trading closer to its 52-week low, $88, than its 52-week high, $343. Over the last month, Meta has squeaked out a small under 1% gain while for the year the symbol has taken on a major beating, down 65%. Although there is room for the upside, I do not believe Meta will get there just yet.
Earnings are upon us and if last year is any indication we can see an uptick in volatility and unexpected results very quickly. Furthermore, Meta will release earnings which will impact the movement of the symbol no doubt. If the year begins on a down stretch, as it is set up to do so, and we take into account Meta's previous earnings performance and outlook, the symbol does not have great footing entering 2023. This makes it a perfect time to short the Facebook-parent Meta!
Furthermore, looking at the 10-day forecast, Meta is boasting an impressively negative trend in its predicted data. After a single positive forecasted session, the remainder of Meta's forecast is a negative trend with the vector steadily decreasing. This is exactly what we look for in symbols we want to short. Meta could sell off and even more so under the pressure of a market-wide selloff spearheaded by tech.