China's Magical Trade
Hello 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.
Q4 Earnings season has officially kicked off, with major banks reporting their results Friday. This comes on the heels of a relatively positive week, in which major U.S. indices climbed higher off the hope and eventual results of the latest inflation data. With now six straight months of cooling inflation, a Fed that has signaled its intention to curb hikes when appropriate, and the latest earnings season upon us, it appears the bear market narrative has temporarily shifted. Still, as outlined last week, I believe 2023 will predominantly be a bear market and one in which active short-term investing succeeds far better than passive.
With that in mind, I'd like to review and highlight one of my favorite services to use during times like these: Earnings Power Trader.
YellowTunnel Trading Tool Evaluation
At YellowTunnel, our software-based trading tools allow users to research their own trades as well as review our latest recommendations. With Earnings Power Trader, my intent was to create a system that would utilize and analyze earnings trends leading up to, through, and after earnings season in order to book gains that are time-specific. And that is exactly what I did. My A.I. model compiles up to 10 best trades, which are then sorted into selective time frames and referenced with a list of companies set to release earnings soon before being scanned for the best opportunities. I help sort the data and initiate buy alerts when appropriate.
The primary objective of Earnings Power Trader, my earnings-based online trading tool, is to take advantage of elevated and implied volatility during earnings season. This brings its fair share of market shake ups, as companies are evaluated while the market is analyzed through that lens. With an uptick in volatility traditionally found around changing times, as well as the current recession-focused and inflation-watching state of the market, Earnings Power Trader provides a leg up for most retail investors. We aim to help all levels of traders, and this system does just that.
One key attribute of EPT I would like to discuss is its ability to hedge stock and use an iron condor. During my weekly webinars, I discuss various hedging strategies as appropriate. Letting you directly into my trading portfolio, I share with full transparency exactly how I approach the market.
This strategy is of additional benefit during earnings season as we could use the implied volatility to our advantage. An iron condor is an investment strategy that groups puts (long and short) with calls (also long and short), all having the same expiration date. This tactic provides maximum return when the underlying asset falls in between its middle strike prices at expiration - aiming to exploit a symbol's volatility.
The iron condor strategy, while not the only strategy we use with EPT, yields exceptional returns when the underlying asset remains stagnant; however, it can be customized with either a bullish or bearish outlook.
Likewise, an additional benefit of iron condors lies in its safety; profits from this trade are limited to the premium received while losses are capped as the difference between the call and put strikes minus the net premiums.
Using this strategy falls in line with the YellowTunnel service mantra of applying both fundamental trading strategy and guidance along with a psych angle. Knowing earnings will yield volatility but perhaps not as prognosticate offers us the opportunity to move in on spots we believe we have an edge on. And EPT does just that by highlighting these companies!
The three key attributes Earnings Power Trader provides to the everyday trader include:
- Weekly participation in my Strategy Round Table where you will get live stock and option picks that you can profit from right away.
- Roughly 10 trade recommendations per day - using the same algorithms and my research delivering an average % per trade!
- Weekly Market Plan videos to keep you on top of the latest news and developments.
To get a good look into all the happenings at YellowTunnel, and the strategies we are currently implying, I recommend joining us for our upcoming webinar this week, Thursday, January 19th, at 1 PM ET:
Best 2023 Inflation/Recession Resistant Earnings Season Trades
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 also 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.
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 1.82% higher, near $397. Major U.S. indices edged higher by week's end with the latest CPI data providing support. The volatility index steadily declined throughout the week, trading near $18 level on Friday.
This week's most influential market mover was the CPI data release - as well as the beginning of the latest earnings season with $JPM, $TSM, and $DAL data. Currently, the SPY is encountering its overhead resistance levels of $395 and then $402. Its support sits below $385 and then a further level down to $375. In the coming weeks, I anticipate that the market will continue to hit new lows. I would be BEARISH ON THE MARKET at this time and encourage readers to hedge their positions. See $SPY Seasonal Chart:
To open the week, stocks surged on Monday in anticipation of this week's inflation statistics and corporate earnings reports. This did not last long, however, as by day's end stocks saw a bit of a pullback, reducing their prior rally from Friday. Additionally, Treasury bonds are high and yields have decreased, not to mention rising oil prices due to China's relaxing of border control restrictions amidst the Coronavirus pandemic.
All eyes this week were on U.S. inflation data and fourth-quarter earnings season, officially kicking off with major banks releasing their reports on Friday.
Although some Federal officials have expressed worries that the economy could suffer further harm, these fears were somewhat alleviated on Tuesday when the Central Bank Chairman's speech provided few specifics and left stockholders hoping for a brighter future before Thursday's Consumer Price Index report.
When CPI data was released on Thursday, markets received a welcome line of support.
All three major U.S. indices rose following the release of the latest Consumer Price Index report, which showed signs of slowing inflation and raised expectations for a change in course from the Federal Reserve. Sentiment improved as investors began envisioning a Fed that would cease rate hikes for the time being.
According to the consumer-price index, prices in December came in at 6.5% more than a year ago—with core CPI (excluding food and energy costs) at 5.7%. This is in line with forecasts that inflation should be moderating and lower than the November reading of 7.1%. For six consecutive months, we have observed a decline in inflation, which supports and aligns with the Fed's goal to reach 2% target inflation.
Moreover, the bond market is suggesting that the Federal Reserve's rate-raising trend may be coming to a close. The two-year Treasury yield had reached 4.2%, but when the results were reported it quickly plummeted to 4.120%. Similarly, 10-year yields dropped from 3.55% down to a mere 3.425%. These figures are an indication of market expectations about future federal funds rates and demonstrate how drastically investors reacted when faced with new economic information.
This brings us to Friday the 13th. Five major financial institutions—JPMorgan Chase (JPM), Bank of America (BAC), Citigroup (C), Wells Fargo (WFC), and BlackRock (BLK)—released their Q4 earnings, essentially marking the start of the earnings season. As major banks traditionally kick off earnings season, they provide insight into where the market is heading and how other earnings results could potentially turn out. JPMorgan Chase and Bank America lead the way with both earnings topping estimates and shares soaring. Along with quantitative results, investors looked to additional qualitative clues as to how companies and the economy were doing. With some contrasting views, it appears an upbeat view is present, albeit with some hesitation regarding geopolitical factors and further examination of Fed action and inflation levels.
Monday will see markets closed in observance of MLK Day while Q4 earnings season officially will be in full swing with hundreds of reports due as well as several major names. Marquee reports next week include Goldman Sachs, United Airlines, Charles Schwab, Netflix, American Airlines, and Procter & Gamble. Additionally, look out for the latest Beige Book during the shortened trade week.
As we move into the second part of January, I am keeping an eye on a particular sector with enthusiasm and anticipation. Taking into consideration that the market is currently oversold, more volatility should be expected as the earnings season approaches and could very well spark it.
At the midweek point, U.S. rates declined after Europe's buoyant CPI news and the dollar stayed stable. 10-year yields were still near their long-term support of 3.5% in spite of services PMI data - but then quickly improved when Thursday brought out positive U.S. CPI information.
In my estimation, the bear market will remain in place throughout 2023. As of now, the U.S dollar has seen widespread selling; however, I anticipate a renewed strength beginning as early as January and continuing through February.
With diminishing demand, the cost of oil and gas has dropped to an all-time low of $65 a barrel for West Texas Intermediate. Outlined in similar CPI data sourced from Europe, there is sustained growth within the market that I am predicting will reach its peak between $390-$400 on SPY stocks.
I anticipate that equity markets will be volatile and, at best, the market will reach the bottom in the first half of the year. The main reason is that S&P 500 revenue numbers will most likely have to be revised downward, which is not factored into the current market levels.It appears investors are less concerned with inflation data and are starting to concentrate on recession expectations as yields continue to drop.
With this in mind, let's review my latest Sector and Trade of the Week.
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Free Event
BEST 2023 INFLATION/RECESSION-RESISTANT EARNINGS SEASON TRADES
WHEN: Thursday, January 19th
THE TIME: 1:00 PM Eastern Time (12:00 PM Pacific)
TOPIC: HOW TO RACK UP TO 36% GAINS OVERNIGHT FROM Inflation/Recession Resistant Earnings Season Trades
Right now is the best time to pick through the trades that are expected to soar.
Don’t miss this opportunity.Click Here to join.
A prompt reply will save you a spot.
I expect upcoming events to be challenging for most traders. But you’re my followers, and I want you to come out ahead during this earnings season inflation/recession frenzy.
The next 30 days look like the “filet mignon” of the entire trading year.
Many traders expect an earnings recession this quarter. Most companies are expected to reflect earnings eaten away from inflation. But there will be many surprises. Don’t miss this opportunity to cash in and feast on stocks the market has overlooked.
Just click on the following link below to register right now for my “How to Rack-UpTo 36% Overnight Gains From Inflation/Recession Resistant Earnings Season Trades” Webinar at 1 p.m. ET on January 19th…
Click Here to Register Now
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SECTOR SPOTLIGHT
iShares China Large Cap ETF (FXI) carefully monitors a market-cap-weighted index of the 50 most significant Chinese stocks that are actively traded on the Hong Kong Stock Exchange and currently trades at $31.81. Trading near the middle of its 52-week range of $20-$39, the symbol had slightly sold off Thursday after moving higher throughout the week, before recapturing gains on Friday.
Despite the potential of a bear market this year, there are still chances to take advantage of and book profits. I'm looking closely at this symbol with anticipation for possible rallies in the near future. Because China recently altered their COVID policy by opening its borders again, Chinese-based businesses may exceed all expectations and grow throughout 2023!
The 10-Day Stock Forecast Toolbox prognosis of FXI displays an impressive, sustained vector trend pointing northward. This phenomenon provides me with assurance in my forecasts and decisions concerning this stock symbol.
Not only is the chart pattern promising, but our Artificial Intelligence platform has also generated a "buy" signal. Our analysis of seasonal charts in three distinct time frames—20 days, 30 days, and 50 days—has shown a strong probability of trading higher; this suggests that investing in this stock could yield significant gains! See $FXI seasonal chart below:
If Chinese businesses are to boom, then there is one symbol I will certainly be getting involved with, along with FXI, to book gains in the first quarter of 2023.
TRADE OF THE WEEK - CHINA’S MAGICAL TRADE
Alibaba Group Holding Ltd ADR (BABA) is one of its largest holdings in FXI and is one of China's most well-known and important companies. BABA is the undisputed leader in providing internet retail services in China and has a substantial business-to-business presence. With cloud computing, digital media, and platforms tailored to support start-up businesses by nurturing their innovations, it comes as no surprise why many refer to them as 'the Amazon of China'.
Currently trading at $115.45, BABA's 52-week sits at $58-$136. This symbol is offering an unprecedented chance to purchase a top-name stock at a slight discount with massive room for growth as China’s economy resumes post-COVID restrictions, making this the perfect opportunity for the start of 2023!
Looking at BABA's 10-day forecast we see similar results to that of FXI: an impressive, one-directional trend towards the upside.
The Stock Forecast Toolbox predicts that BABA will experience a positive trend in the next 10 days, with strong and consistent gains. The Model Grade "B" provides me with confidence in the A.I. forecast and the strong vector trend displayed in its predicted data offers me a strong indication to buy in. All this gives me confidence in 'The Amazon of China' going forward!
Furthermore, let's inspect BABA's longer-term forecast via Seasonal Chart. Looking at the Seasonal Chart of BABA seen below, the symbol is flashing a very impressive probability to go higher in the next 20 and 30-day time ranges. Over the past few weeks, BABA's seasonal level and current level have been steadily converging, leading to a scenario where investors can achieve profits at its present price.
This week, I’ll be adding $BABA to my portfolio.
Discovering this trade 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 85.01% 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 looking for a more timely approach to trade should join the YellowTunnel community, where nearly 85% of trades were profitable, and utilize one of our AI trading platforms for no-excuses Trading. Our AI platform breaks down and analyzes hundreds of proprietary performance indicators to help you get the edge on your portfolio!
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 the first quarter of 2023 the best trading quarter of your portfolio yet!
Have a fantastic week, keep Ukraine in your thoughts and prayers, and let's make some great money together.
One more thing, I've had the opportunity to take additional action with a great organization supporting families in Ukraine directly. Gate.org is a foundation where fundraising is held for specific families, allocating funds to multiple families currently living in Ukraine. I am on the board of directors for this great initiative and encourage everyone to check it out and donate if possible. The war in Ukraine is escalating and families are being negatively impacted and displaced daily. To learn more about this initiative to help families, please see the link below:
Thank you for subscribing to my blog, let's have a great trading week!