Adam's 5 Big Market Predictions for 2011

It's that time of year again when everyone who is considered an "expert" comes out of their ivory towers and makes their annual market predictions for the New Year.

It's time to kiss those predictions goodbye.

I can honestly say that I wish I had a crystal ball like these other forecasters, but that's not quite how the markets work. You see, markets don't give a "Rats A**" about what forecasters say or what predictions economists make. The market is the only true voice out there.

Think about that for a moment. How many predictions do you remember that were even close to being spot on a year in advance? I remember several forecasts for 2010 and most of them were far from accurate.

Does it make any sense to trade on a year-end forecast, not knowing what can happen in this crazy world we live in? It doesn't make any sense to me or to other professional traders who never trade based on year-end predictions.

So let's get back to reality and take a look back on 2010 to see what the big trends are showing for 2011.

1. GOLD: Major Trade Triangles Bullish

Let's start with everyone's favorite market, gold. Gold is without question the most emotional market in the world. Investors and traders who are involved with this metal are passionate about its future and that can be a bad thing. Let me explain. Back in 1980 gold peaked around $850 an ounce. Had you purchased gold around that time, it would have taken approximately 30 years for gold to get above that level again. Call it the lost 3 decades.

Now the arguments are that the gold market should be trading well above $2,000 and that the central banks and governments are manipulating the price for their own advantage. Don't believe it. There are also hundreds of other conspiracy theories that seem to pop up for this particular market. Like I said, it is a passionate and emotional market.

Here's how I'm going to trade gold in 2011. In 2011, I'm going to rely on MarketClub's "Trade Triangle" technology which has an excellent track record in gold. (You can take a look at MarketClub's track record right here.) By taking a methodical approach and not guessing which way the wind is blowing, you have a far greater chance to close out 2011 with a big plus for the year.

I expect the gold trend will carry over from 2010 and then change somewhere along the line. This is the history of this market. One thing that I can be 100% certain of is that gold prices will fluctuate in 2011. That's a guarantee!

2. CRUDE OIL: Major Trade Triangles Bullish

Next, let's take a look at a market that impacts everyone's pocket book, crude oil. Crude oil recently moved over $90 to two-year highs and once again shook up excitement in this market. When looking at the fundamental market, we're running out of oil, production continues to go down, and no new oil fields have been discovered in the last several years. The other fundamental story is that China and India are becoming more affluent and developing a middle-class economy which will lead to increased oil consumption to power their newly purchased cars and scooters. This could all be true, however; it really doesn't change the way you should be looking at the market. Once again, we are going to rely on MarketClub’s Trade Triangle technology, which has done a stellar job identifying trends in this market over the last few years. (You can see MarketClub's track record here.)

So at the moment, the trend in crude oil is on the upside for 2011.

3. US DOLLAR INDEX: Major Trade Triangles Mixed to Negative

The other big market that everyone is talking about is the US dollar. You may or may not remember the doomsday forecasts in December of 2009 for the dollar. Quite the opposite occurred as the dollar enjoyed a spectacular rally for the next six months. That's the whole point of this report; listen to the markets and ignore the predictions of the so-called experts. (MarketClub has had a very successful run in the dollar index and you can see the results here.) Again, we will be relying on our Trade Triangle Technology and the technical approach to follow market trends in 2011.

4. GLOBAL STOCK MARKETS: Major Trade Triangles Bullish

I want to talk about the stock market, both in the US and overseas. One of the more interesting portfolios we created in 2010 was MarketClub's "Global Strategy" portfolio that tracks five different countries. The MarketClub technique using the ETF markets has worked well for our members. We track the following five countries: Brazil, Russia, India, China and Australia. (This portfolio, which is available to all MarketClub members, can be seen here.) We also follow the ETF SPY as it tracks the S&P500. Once again, we use our Trade Triangle Technology to determine the trends in five ETFs. (You can see the MarketClub's trading rules right here.)

5. COMMODITY MARKETS: Major Trade Triangles Bullish

Lastly, I want to talk about the commodity markets. You have no doubt heard or have seen that copper prices are at record highs, but you also have other markets that are jumping up and these are all anticipating both strong demand and are now in the beginnings of an inflationary spiral that we envisioned sometime back. Commodities are going to be very important in the future. Traders should be paying close attention to these markets and creating in a new portfolio manager with various commodity portfolios to track these lucrative markets. If you want to see how we have have performed in these markets you may want to take a look at MarketClub's "World Cup" Portfolio. Since July of 2007, your money would have multiplied 786.16 %by June of 2010. That’s enough to turn $50,000 into $391,580.00 in just three years.

So maybe this is not as exciting or as hyped up as someone saying, “Here are my top five picks for 2011,” but it's a way to make real money in 2011 and not without having to wing it like so many investors will be doing in the new year.

I think 2011 is going to offer some extraordinary opportunities in the markets listed above. Remember, in every crisis or every boom there are opportunities to make money. It's when things are dull and boring that it becomes more difficult to produce the type of returns that we are looking for.

So what’s my number one tip for 2011? Watch and trade with the MarketClub's Trade Triangle technology and ignore the hyped up new year predictions.

Here's wishing you every success in 2011.

Adam Hewison
Cofounder, MarketClub.com

38 thoughts on “Adam's 5 Big Market Predictions for 2011

  1. SILVER IS THE BEST INVESTMENT IN THE WORLD.
    Silver has gone up 600% in the last ten years.
    Silver is three times better than gold and
    will go to $400 an ounce. Buffett made a mere
    70% in ten years with his "legendary" Berkshire
    Hathway. He has LOST money in the last three years.
    Silver is the best investment in the world and
    has been for a decade now. You didn't mention
    silver Adam. We're 100% invested in silver.

  2. Thanks for that wonderful rendation.It appears to me the CLUB is not meant for those of in FOREX trade? I think you concentrate so much on others but only scrtch forex on the surface.Have a wonderful New Year

    1. Nodieze.

      Thank you for your feedback.

      MarketClub does in fact cover and focus on forex. We have real-time prices and charts on all the major pairs and a number of lesser traded cross-rate.

      All the best,
      Adam

  3. Hello. I love , love your service. I find it deadly accurate. I use it for swing trading and it never has failed , even once. I have just one request. I have to keep lists of the scores so I can follow if they are rising or falling. Would it be possible to have an extra column to indicate the most recent previous score or the direction that the present score is moving. I notice that when I rank them they seem to come up in order of strength now. I hope my request would be something that's easy to program . Thank you and best wishes for 2011. Florence

    1. Flo,

      Thanks for your feedback.

      Check out our new portfolio manager which is coming out any day now. It will do what you wantI think you are going to love it.

      All the best.
      Adam

  4. Hi Adam,

    I moved much of my money last year into precious metals and miners and have done very well. I am of the belief that we are heading for bad times ahead in the next few years. I don't think you are going to see a market crash, in fact I think you are going to see a inflation driven market rally. Problem is with that rally will come the devaluation of the U.S. dollar. I'd like to see you spend more time on silver as I feel many investors will flock to silver as gold prices the little guys out of the gold market. Would you consider doing a video every week or every other week on silver? Might be fun to watch in 2011. Silver is going to be THE 2011 trade.

    Thanks
    Tom

  5. Adam,

    Two questions:

    Have you thought of adding an agricultural ETF like DBA to the Perfect R portfolio for those of us who are unskilled at trading the futures in the world cup portfolio?

    I have heard from many people that USO creates bad tax consequences that can wipe out capital gains. Any advice on dealing with these?

    Thanks,
    David

    1. David,

      Happy New Year.

      I can't advise you on taxes.

      As for adding an agricultural ETF like DBA to the Perfect R portfolio it is possible for you to do this yourself. Here are the rules that need to be followed:

      How "Trade Triangles" work in ETFs (PerFect "R" Portfolio)
      The major "Trade Triangle" to watch in trading the 4 ETFs in MarketClub's Perfect "R" Portfolio is the monthly "Trade Triangle" as this triangle determines the trend and your position. You would use the monthly GREEN "Trade Triangle" as an entry point and use the monthly RED "Trade Triangle" as an exit point. You would only reenter a long position if and when a GREEN monthly "Trade Triangle" kicked in. This portfolio is suitable for 401K and IRA retirement accounts therefore it is not allowed to short ETFs.

      All the best,

      Adam

  6. Scott -- go to alerts tab and get alerts emailed to you about anything in your portfolio, it's fast and easy. I set up a separate folder in my email client to catch all these, and check it regularly. I have them send me lots, as it's easy to select them all and delete them once read. As often as not, the good ones come out the night before, which is pretty decent.

    Listen to what Adam is saying here -- you get the best out of this system if you enter when it says, not later and higher, which you can verify by manually back-testing on the charts -- they're telling the truth about when the triangles were put on. Since not every trade is a winner (only nearly all of them) you add to your risk by entering higher than the relevant triangle you are timing off of, and should only enter lower than that if other indicators say that the drop is probably temporary, eg divergence in macd or obv or other indicator you've learned the use of. For example, if it's lower but rising fast, catch it!

    If you have some experience day trading (which is where I was before re joining) you can sometimes catch better entry and exit points and do even better....but that takes some fairly serious experience and the usual homework. I'll exit before the triangles sometimes if a quick peak gives "too good to be true" results, for example, and maybe get back in if the thing mean-reverts after that (often). It does take a lot of practice to actually do better than Adam's scheme above, however, and I don't always manage.

    So, keep it simple and you'll do fine, or at least I do, and I do it just like he's saying above. Any extra little bit I've gotten by being "Tricksy" is usually canceled out by missing the next move anyway. His system gives me the confidence to be more patient around the little dips and I make more money using it.

  7. i think next year
    crude oil tread 112.00 $
    gold 1530.00 $
    silver 40.00 $
    eur 1.7400 $
    gbp 1.7400$
    and next year
    2012
    gold 1140.00 $
    oil 160.00 $
    and more +9233-4395740

  8. I just joined. Is there a way to have the buy/sell signals emailed to me for the Global Strategy portfolio? Also, if I joined today, and the Monthly triangle is green for any of the ETFs, is it ok to enter, or does one enter only when the fresh signal is generated?

    Thank you

    1. Scott,

      You might want to put half a position on and the other half on a pullback.

      Here are the rules for trading in ETFs.

      How "Trade Triangles" work in ETFs (Global Strategy Portfolio)
      The major "Trade Triangle" to watch in trading this portfolio is the monthly "Trade Triangle" as this triangle determines the trend and initial positions. We use the weekly "Trade Triangles" for timing purposes. Let me give you an example, if the last monthly "Trade Triangle" is GREEN this indicates that the major trend is up for that ETF. You would then use the initial GREEN monthly "Trade Triangle" as an entry point and use the weekly RED "Trade Triangle" as an exit point. You would only reenter a long position if and when a GREEN weekly "Trade Triangle" kicked in. You would then use a weekly RED "Trade Triangle" as an exit point. Providing that a monthly GREEN "Trade Triangle" is in place the trend is positive for the ETF. The reverse is true if a RED monthly "Trade Triangle" shows that the trend is down. You would then use the weekly RED "Trade Triangle" for entering short positions and the GREEN weekly Trade Triangle exiting the market.

      Thank you for your business and every success in 2011.

      Adam

  9. My biggest wish for improvement would be plots that are either log labeled or constant percent, followed by being able to overlay two for comparison purposes. I currently have to go to Google to get these, and it's very useful. After all, I don't care about a 10 cent move (which is very different on a $5 stock than a $500 one) - I do care about a 10% move. Linear charts, particularly auto-scaled ones that blow everything up to full scale fool most people and make it harder to make good decisions.

    Further, with autoscale, things like the flash crash reduce many long term plots to more or less a straight line except for one long vertical line in May, again, making it harder for traders.

    If you're using any sort of decent money management, you're trading/investing in "units" of money, not fixed amounts of shares, and you're looking for percent, not dollar, gains on a trade -- the current system (which by the way, my TD Ameritrade software also lacks) makes it harder to know what's worth trading.

    Kind of a pain to have to have so many browser tabs open to flip over to Google to get log plots and comparisons, which are VERY useful. Nothing like being able to overlay, say, all the oil/energy companies and see who's really moving, or all the gold miners vs gold and so on. Very easy to see then who is best in class in a market, and whether a recent big change is the norm or not.

  10. I have been trying to make subscription to ino market-club but my credit card payment could not be charge . can ino please tell any bank in Malaysian credit card/ bank that i can use to subscribe and can be easily be charge with . thanks

    1. Hi Vick,

      I have passed your information along to Melissa in our member services department and she will be contacting you to see if we can get this resolved.

      Thank you and we look forward to you becoming a member of MarketClub in time for the New Year.

      Every success,
      Susan, on behalf of the MarketClub Team

  11. ..gold prices will fluctuate in 2011. That’s a guarantee!
    ..at the moment, the trend in crude oil is on the upside for 2011.
    ..we will be relying on our Trade Triangle Technology and the technical approach to follow market trends in 2011.
    ..we use our Trade Triangle Technology to determine the trends in five ETFs.
    ..Watch and trade with the MarketClub’s Trade Triangle technology and ignore the hyped up new year predictions.

    As predictions go, I can safely ignore these Adam.
    Please predict when the real-time quotes will be coming. It's almost 1.5 years since I was told 3 months.

    1. Larry,

      I know, it has been a challenge. But here is what's happening. We are rolling out a new portfolio manager that will make keeping multiple assets and portfolios as easy as 1,2,3. Expect that any day now.

      Now here is the answer to your question regarding real-time quotes. Once the portfolio manager launches which will be any day now, our whole team will be focused on real-time equity quotes and charts. For the last several months we have been building out the infrastructure which is the foundation for doing real-time right. Our whole IT team is devoted to getting this online and getting it right. So I ask you to keep the faith and bear with us awhile longer. You will not be disappointed.

      All the Best,

      Adam

  12. Interesting... much safer to chose sectors than individual stocks. No one has a crystal ball... and you're right, the Markets are the truth tellers. Cheers!

  13. Thank you Adam, as always, you are in the corner of the little guy.

    I expanded my Perfect Portfolio to include the UUP/FXE component for long and short the dollar.
    I like the DBC for the long haul and use the GLD/USO for short-term swings when the charts look good.
    Also instead of the SPY, I've been using the IWM to good results, and I use the EEM to add the world component
    to my modified Perfect Portfolio. In a Down Trend, I use the RWM to short the market.

    Those sideways, choppy, volatile movements sometimes trigger those Weekly Triangles to my disadvantage,
    so I've been tweaking the Triangle Method just a bit to see if I can get more capital preservation during the sideways-choppy movements.

    Definitely during the Trends and subsequent Pauses, the Triangle Method works very well.

    1. John,

      Thanks for your feedback and suggestions. I plan on looking into them in more detail in the New Year. The sideways markets are the price we pay for catching the mega trends.

      All the best in 2011.
      Adam

  14. Jeremy,

    Thanks for your comment. I was unaware market club did individual stocks - sheesh. Is there any depth to the stock coverage or is it primarily just the heavy weights?

    Ed

    1. Ed,

      Thank you for your comment. MarketClub provides great depth of the Stock Market. We currently track, chart and produce the Trade Triangles for the complete U.S. and Canadian Exchanges. We give access to all the symbols whether they are the heavy weights or the light weights. I urge you to take a trial and see what MarketClub can do you for you.

      http://club.ino.com/join/

      Happy New Year,
      Jeremy

  15. I have truly enjoyed/used Market Club information - general market triangles to assist in my individual TA stock trading - VERY HELPFUL.

    If I were also doing futures - I'd join Market Club.

    Thank you for your insights and help. When I trade futures again. I'll be joining Market Club.

    My Best to You and Yours,

    Ed Ward, MD

  16. Jeremy:
    >the Triangle’s are placed they never leave the chart. You can at any time go back and test the strategy yourself on any chart/symbol to see how it >would of performed for you and your trading style
    Great thanks. A post of how to do this would be good. I always look in graph view, should I look to table view to facilitate this?

  17. "Now the arguments are that the gold market should be trading well above $2,000 and that the central banks and governments are manipulating the price for their own advantage. Don’t believe it. There are also hundreds of other conspiracy theories that seem to pop up for this particular market. Like I said, it is a passionate and emotional market."

    Adam, was it not you who said you like to be out of the markets during the "Silly Season? "Dare I mention the M word" you said. I am confused. You were right the first time. Markets DO usually get manipulated when thinly traded. Especially silver and this brings down the gold price. JP Morgan may have given it a rest this time because off all the adverse publicity it has been getting. But to say "don't believe it" should only apply to Santa Claus and tooth fairies.

  18. Laughing about your statement about how much the markets care about predictions of pundits (and shills)! It may take awhile to stop giggling.
    Anyone who thinks they don't have to earn it, and could just put things on "auto" might as well just light their money on fire in this world we have now.
    Closest you're going to get is the triangles, pay attention, do your homework, and you'll get the money you earn thereby.

    Happy new year!

  19. Adam: I agree with your predictions. I use weekly trade triangles to manage my positions. Long GLD, DBO, DBC, DBA, EEM, EWZ, EMF, IWM, SPY, QQQQ, DIA plus individual stocks such as COST, LLTC, NUE, AAPL which have all worked fairly well on the trade triangles. (not equally weighted in the above).
    One prediction I would love to hear from you is when the multiple portfolio feature will be available to members. I was told some time ago it was very close. My last e-mail to customer service was ignored.
    One other thing that I think would make Marketclub even better: Some tickers work better with one trade triangle better than others (monthly, weekly, daily). As I know you have the database already, the ability to backtest on trade triangle signals would be a killer ap. If you tell me it's there already, of course, I will be red-faced.
    Happy New Year and good investing for all in 2011.
    Anthony

    1. Anthony,

      The Portfolio Manager will be available very soon. I don't have an exact date as to when just yet, but we are in the final stages of Beta testing with it. So stay tuned! As for a back testing app, we are looking onto to adding this feature to the service in the future, however once the Triangle's are placed they never leave the chart. You can at any time go back and test the strategy yourself on any chart/symbol to see how it would of performed for you and your trading style.

      Have a happy New Year,
      Jeremy

      Jeremy Lutz
      Head Of Technical Support and Customer Service
      MarketClub and INO.com

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