Happy Holidays 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.
It was another pivotal week in economic reporting with CPI data, retail sales, the import price index, as well as the latest Federal Reserve policy update. Wednesday saw the conclusion of the two-day Federal Open Market Committee meeting in which the Fed snapped its streak of 75 basis point hikes and instead opted for a 50 basis point hike. Still, pessimism grew large following comments from Fed Chair Powell, as the Fed’s hawkish tone indicated additional exaggerated hikes and growing concerns over a recession.
The news-heavy week had me parsing through the data and searching online for the latest results as markets flipped throughout the week. Just on Wednesday, shares opened higher only to lower significantly following the hawkish Fed tone. With this in mind, I began to wonder how quickly, and if, YellowTunnel's reputation had changed. About a month ago, a scam-based review slandered my platform by illegitimate online "phishers” looking to profit where they can. Choosing the trading industry, one particular scammer conjured up a baseless overview of YellowTunnel. To this, we quickly responded at YellowTunnel with a self-audit, reviewing our own platform and tools to improve reputation, increase transparency, and improve trust.
While I have no doubt our actual subscribers trust us, I do want to squash any "is yellowtunnel.com legit" discourse that may influence non-members via the previous erroneous review. So once more, I looked into our online reputation and decided to break down one section of YellowTunnel I believe lacks genuine, online reviews and presence: Dynamic Power Trader.
YellowTunnel Dynamic Power Trader Overview
Unquestionably, it has been a nerve-wracking period for any typical investor these last few years. If you aren't adept in the stock market, just possessing shares of the S&P 500 could bank serious losses depending on the time of entry. Industrial traders manage to squeeze out gains with high-end tech and years of data and research. While I also offer those informative perspectives, my approach is quite distinct - aimed to help all levels of traders. And where certain services got crushed by inflation pressures and the latest turns of the market, my system has chugged along fairly well.
Since I began trading with my cutting-edge AI-powered stock analysis system in July 2016, even amidst the current market decline, we have beat market averages and booked profits in all trading landscapes. My algorithm has been designed to provide a balanced portfolio of stock and options trades, reducing the risk associated with each trade while maximizing your chance for success. We provide a well-rounded approach that makes it easy to stay informed and develop your own strategy when dealing with stocks and options - or both.
As you go along, you have the ability to adjust your strategy in order to reap maximum profits. In a nutshell, this is an investment system designed for any level of confidence and proficiency.
We provide you access to the sophisticated trading algorithm that has an over 85% win rate, sends out real-time trading alerts, and offers unlimited access to our weekly training sessions, videos, and webinars. Our approach to tackling the trading industry is servicing the everyday trader, as well as the experienced long-term trader, the technical and fundamental stock analysis to improve ROI and trade in any market conditions.
That's what makes YellowTunnel different and one of the best out there. Dynamic Power Trader, one of our key membership platforms, gives members access to my proven algorithmic trading system which will send out real-time recommendations every week. Detailed trade alerts inform members of entry and exit strategies - right as I place them!
Looking at my entire Dynamic Power Trader portfolio, the overview of this YellowTunnel service will show you that this system has been proven to generate an astounding win rate of up to 75%, and even 86% during these unpredictable times.
It is of particular importance to mention: this system is the exact same one I use every single day in my trading. You can see me trade with it during my live trading rooms and weekly webinars. If you are unable to attend, Our service will provide you with detailed instructions and timelines on precisely what to do, how to execute it swiftly, and when the optimal time is for exiting.
My remarkable track record is due to the combination of sophisticated algorithmic and fundamental analysis. Dynamic Power Trader is nothing short of a trading game-changer since it's capable of giving precise buy/sell recommendations just at the right moment. With this system, you won't ever have to search for another reliable trading platform again!
On top of all of that, you will also be part of the YellowTunnel trading community. Beyond trade signals, we look to help members become more well-rounded traders with our all-encompassing approach.
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
On Friday, stocks took another dip as investors worried that more stringent central bank policy and an impending recession could be on the horizon. This has been ongoing since the Fed announced its latest policy update on Wednesday, triggering a selloff to end the week - with all three major U.S. indices booking weekly losses.
This, however, was not how the week started. To open up a week of inflationary news and central bank activity, U.S. indices traded confidently as investors maintained their optimism amid the market movements. After its brief fall the prior week, stocks on Monday skyrocketed in expectation of imminent inflation data and Federal Reserve moves that could shape economic trends for the remainder of 2022. As discourse soured, stocks began to feel pressure Tuesday but held onto gains.
Tuesday's release of Consumer-Price Index data indicated that prices rose by 7.1% year-over-year in November — a notable decrease from the 9% peak experienced this past summer. Following the disclosure that inflation data was lower than anticipated, the stock market experienced a slight upsurge; still, all three key indices finished below their daily peaks. The report failed to meet expectations of 7.3% and decreased from October's surge of 7.7%. Excluding food and energy prices, the core CPI rose 6%, slightly down from October’s 6.3%.
Wednesday started off with the stock market trading slightly higher, but following the Federal Reserve's declaration to up interest rates by 0.5%, stocks quickly tumbled and closed at their lowest point of the day. This snaps four successive increases of three-quarters percentage points each, this latest raise appears more moderate than before.
With the Federal Reserve’s “dot plot” projections suggesting a near-term interest rate rise, economists anticipate that by 2023, the federal fund rates will exceed 5%. This relatively high level is expected to remain for an extended period.
The Federal Reserve is keenly aware of the potential to further depress economic demand and inflation through higher rates. This being said, they have made it clear that they are seeking only a mild recession rather than an extreme one. The dot plots, however, show that if inflation continues to remain above 2%, the Federal Reserve will struggle to achieve its objectives.
Not only did the Federal Reserve make a rate increase, but other central banks have done so as well. On Thursday, both the Bank of England and European Central Bank increased their short-term rates by half a percent - showing they are prepared to continue this trend in the near future.
Back in the U.S., retail sales plummeted by 0.6% in November, which is worse than expected; however, markets are quite content with this decline because it indicates that inflation could possibly drop and prompt a shift from the Fed’s approach.
Still, the stock market continued to sell off on Thursday in response to the Federal Reserve's monetary policy decision. The Fed's new measures could lead to a more rapid rise in interest rates and create greater financial difficulty for investors, leaving them wary about their future investments.
Adding to the U.S. markets' stress was a lower-than-expected jobless claims figure of 211,000 - which ran contrary to analysts' predictions of 230,000. Consequently, as long as indicators point to a labor market recovery and inflation decreases gradually, the Fed will not hurry with switching its policy.
Despite the instability of the market, a glimmer of optimism emerged. Bond yields remained largely unchanged in light of Federal Reserve Chairman Jerome Powell's speech as U.S. two-year Treasury yield closed at 4.245% on Thursday and stayed comparable to Wednesday’s close rate – both lower than its multi-year peak at just over 4.7%. This steady trend offers hope for investors that bond prices will remain stable despite uncertain times ahead.
With the week coming to a close, past the midway point of December, markets plummeted due to several factors such as hawkish remarks from the Federal Reserve, unexpectedly high inflation rates, renewed recession fears, unsatisfactory retail figures, and low joblessness. All signs are now pointing to a recession.
As of Friday, the 5-day chart shows the $SPY was trading 3.28% lower, near $381. All three major U.S. indices traded lower on Friday. The volatility index has had an up-and-down week but ultimately ended lower, near $23.
Currently, I am carefully monitoring the resistance levels in SPY which range from $400 to an upper threshold of $410. The $SPY support is at $390 and then $385. As of right now, it is trading in a well-defined range and I'd recommend being neutral instead of making any aggressive bets on either an upward or downward trend. Thus, I would advise my subscribers not to pursue long or short positions at this time. For reference, the SPY Seasonal Chart is shown below:
As the holiday season continues, it's likely that the markets will experience an upturn following its most recent dip. However, this surge may be brief once earnings season kicks off and starts bearing down on investors. Next week, the market focus turns to GDP and PCE data, as well as several earnings including Nike, Micron, and CarMax.
With this on deck, lies a magnificent opportunity for one particular sector to prosper in the weeks ahead!
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- Weekly Market Plan videos to keep you on top of the latest news and developments on Wall Street
- My Power Trading & Markets Weekly Newsletter — provides commentary on market events and trading education.
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Following this week's interest rate hike, market-wide pressure has subdued the holiday rally for the time being. With the next earnings season some weeks away, there is one type of trade I will be looking to execute in the coming. Specifically, I am looking at one sector and one symbol to short if the current market trend and my latest forecast uphold.
As the latest batch of data has shown us, these markets can flip on a dime. With the Fed moving towards a more hawkish stance than what was projected, one sector is set to open for potential gains with a specific type of trade.
Financial Select Sector SPDR (XLF) is currently trading at $33 and is my go-to financial sector ETF. XLF is a favored tool among traders who wish to trade the sector while simultaneously mitigating individual stock risk. With a 52-week range of $29-41, XLF currently sits just above its defined low.
Although shares of XLF have trended down over the past month, zooming out to a 6-month window we actually see XLF has booked some gains in that time frame. With this in mind, it appears XLF has not truly bottomed out yet. As stated above, the recession appears unavoidable and possibly imminent. While I still am gathering my thoughts and forecast data to project when such a recession could occur, what I do already see is that major banks and the financial sector are in trouble.
Therefore, shorting XLF is something I will be looking at accomplishing in the coming sessions. Should selloffs continue XLF is in a position to build new lows, but let's double-check with my A.I. toolset.
Sporting a model grade "A" XLF is one of the top forecasted symbols in the YellowTunnel data universe based on accuracy. Trading lower and closer to our predicted low XLF is angling towards a new low when the next forecast for XLF in my 10-day Stock Forecast Toolbox populates. Having said that, XLF is also showing another positive signal in favor of shorting the bank-focused ETF. See XLF 10-Day predicted data:
With an up-and-down vector score that fails to maintain a notable trend, XLF's 10-day forecast is showing turbulence for the symbol. If additional pressure-inducing reports are released in the market, XLF will likely continue and elongate its downswing - making it the perfect ETF to short to end 2022.
Furthermore, if XLF is to make a decent dip in the coming days, it will likely be led by some of the ETF's main players, which brings me to one symbol rip for shorting.
TRADE OF THE WEEK
As we've recently seen, the oversold market was quick to sell off upon any additional bad news. Not only were the latest economic reports met poorly, they indicated a larger problem in the coming year and even in the coming final weeks of 2022. As shares sell off and respond to these unfortunate reports while we head into a relatively quiet section of 2022, I am banking on banks seeing exaggerated pressure and specifically one symbol bottoming out.
Among the leading components of XLF, Wells Fargo & Co. (WFC) is displaying signs of vulnerability. Wells Fargo underwent a significant transformation guided by its new CEO Charles Scharf who had previously worked as the CEO of Visa and Bank of New York. After being chosen to fix the company’s reputation which was damaged due to scandals stemming from customers being sold unauthorized products, Mr. Scharf has quickly made his mark in transforming Wells Fargo for the better.
Let's break down the A.I. forecast of WFC and see if my models also show a profitable spot to short Wells Fargo.
Looking at the 10-day forecast, WFC is slated to trend lower as the symbol is firmly trading below its predicted low. The forecast similarly shows a vector trend that supports this notion. With several steep signals showing a lower vector score, my Stock Forecast Toolbox has identified WFC as a potential short opportunity. If the current economic landscape is primed for a bank sell-off, my A.I. tools are seeing Wells Fargo definitively participate in the drop-off.
When looking into our long-term forecast, we see several agreeing signals. WFC's Seasonal Chart shows a symbol is set to turn lower in the 50-day time range with strong confidence while the initial three forecasts of higher trading in the 20, 30, and 40 days offer a weak accuracy score. The subpar accuracy forecast means that as soon as Sunday's update Seasonal data, WFC can turn lower in the coming weeks. The symbol shows a sizable gap between the annual seasonal price and the current price which is another key point in picking symbols with upward potential. See WFC Seasonal Chart below: