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Gold
1315.505
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Weak

One Of These Markets Is Going Down Big Time

Hello MarketClub members everywhere! Not sure if you live in the rain soaked mid-Atlantic states, but enough already with the rain! It is depressing. The reason I bring this up is the erratic and somewhat depressing action in the stock market.

On Tuesday we watched a massive rally in stocks and everyone was singing happy days are here again. Yesterday, reality and gravity came into the market and took away practically all of Tuesday's gains.

As I said on Monday when I talked about "The Next Big Swing", I believe that the markets are putting in a major top as both the S&P 500 and the NASDAQ have all flashed red weekly Trade Triangles indicating to be out of the market and on the sidelines.

Apple Inc. (NASDAQ:AAPL)
So sad about Apple, here is a stock that was the "apple of every investors' eye" and now this once super stock is now in the dumpster. The question is, with all the Trade Triangles red and pointed lower for Apple, is it just a false signal or is this really the start of a bigger problem? I believe that Apple has some serious hurdles ahead and as the weeks and months pass these problems will come to the forefront.

The biggest problem for Apple right now is that it is not seen as an innovative growth company. Can anyone say "Nokia" and not wonder what happened to this once-leader in the mobile phone market? The next problem Apple has, and this could well be its number one problem, is perception. Apple is just not perceived as a "cool" company anymore. Apple's third problem is expanding its market for its cash cow iPhone. It very much looks like China wants to put the kibosh on any further Apple iPhone sales as they really want to sell their own smart phones (so much for free trade).

The next big psychological level for Apple is $90.00. Once we see around $89, you will see many more investors throw in the towel. On Thursday the 28th of April, Carl Icahn stated on CNBC that he no longer owned any Apple stock. MarketClub's Trade Triangles exited Apple six days earlier at $104.88. I am guessing Mr. Icahn exited around the same time before he made his big announcement on CNBC.

Daily Chart of Apple Inc. (NSDAQ:AAPL)

[Read more...]

The Next Big Swing In Stocks

Over the weekend I was analyzing the charts and it appeared to me that with Friday's red Trade Triangle on the S&P 500 that stocks have topped out. The similarity between August and September and this January and February is quite startling. If the same pattern holds true then the next big swing in the stock market will be to the downside.

Already we have seen weekly Trade Triangles in the NASDAQ (NASDAQ:COMP) and just recently in the S&P 500 (CME:SP500). These weekly red Trade Triangles many times act as early warning system and are a strong indicator to move to the sidelines in the case of the Indices.

I would not be surprised to see more back-and-forth choppy trading action before the market eventually falls under its own weight.

I am looking for stocks to make a cyclical low sometime in June if the same cycle holds true.

Daily Chart S&P 500 (CME:SP500)

S&P 500 Chart Legend

1. First Low
2. Pivot Point
3. Second Low
4. Cyclic High
[Read more...]

Crude Oil Slips Ahead Of Doha Meeting

Crude Oil (NYMEX:CL.K16.E) is falling for the 3rd straight day and is currently trading near session lows. But why the sudden drop you may be asking.

OPEC producers are due to gather in Doha on Sunday, to discuss whether to freeze oil production output at January's levels. Oil is dipping this morning as hopes of a deal between oil producers has faded. Hopes had been that OPEC would agree to freeze output, but it seems that Iran has other plans. Iran has already stated that it won't agree or adhere to a production freeze as it looks to boost its production. Reason being that sanctions on its oil sales were just lifted in January.

As you can imagine the other OPEC producers are desperate to make a deal and to raise the price of oil. After all, low crude prices have cost them billions of dollars so far.

If you take a look at the chart, you can see that the Trade Triangles entered into a sidelines position today. This is based on the red daily Trade Triangle that triggered at $40.09 this morning.

Daily MarketClub Chart of Crude Oil (NYMEX:CL.K16.E)

Key Levels To Watch:

1. 38.07 - The 50-day moving average provides the key level of support at 38.07. If this level is breached, oil could drop to $30 a barrel.

2. 35.24 - The weekly Trade Triangle will change to red if oil breaks through this level. This would confirm a move to the downside and further weakness.

3. 42.16 - The daily Trade Triangle will change to green if oil breaks through this level. This would confirm a move to the upside and further strength.

As we head into the weekend, I think that the sidelines positions indicated by the Trade Triangles is the best place to be based on the uncertainty of the outcome of the Doha meeting.

Have a great weekend!

Every Success,
Jeremy Lutz
INO.com and MarketClub.com

All Aboard The Gold Train

Yesterday, the Trade Triangles issued a green weekly Trade Triangle for gold. Gold (FOREX:XAUUSDO) now has three green Trade Triangles indicating that it's ready for the next upward leg in this long-term bull market.

As I have pointed out before, this quarter is the highest-rated quarter with an 83% success rate for gold trades using the Trade Triangles. Let me just be clear that this does not mean that this particular trade is guaranteed to be successful, but the odds are heavily in your favor.

I've added two charts below, a daily chart and a quarterly chart to illustrate the last time gold was in a prolonged bull market. That bull market started in Q1 of 2009 and continued for 11 quarters ending in April 2011. On the quarterly chart, you will see that every quarter for those 11 quarters the market closed higher than the previous quarter. If that same scenario plays out again, gold has 9 quarters to go.

Quarterly Chart of Gold (FOREX:XAUUSDO)

Key To Quarterly Chart

1) The start of the 11-quarter bull market
2) The RSI indicator moves to its highest levels in 3 years
3) Gold is 2 quarters into a long-term bull market

While the quarterly chart gives us a view of the big picture of how gold has acted in the past, the daily chart shows you how to use the Trade Triangles. For intermediate-term trading, you use the weekly Trade Triangle, which we just had a signal with yesterday, as the trend indicator and the daily Trade Triangle for exit and entry signals. If you are a long-term trader, then you want to rely on the monthly Trade Triangle, which has been positive for quite some time. [Read more...]

This Stock Could Appreciate 50% In The Next 6 To 12 Months

In case you missed it yesterday, Alibaba Group Holding Limited (NYSE:BABA), took a 5% position in Groupon Inc. (NASDAQ:GRPN) which was enough to push this stock up 40%. Yesterday's action by Alibaba was seen as a black swan event that could not be predicted by any indicator. Groupon had been in a steady decline after hitting a peak of over $27 when it began trading. Since that time, the stock has steadily moved lower and recently traded perilously close to the $2 level.

As I have said many times before, perception is very important in stocks. The fact that Alibaba took a 5% stake in this company should not be overlooked.

Technically speaking all of the Trade Triangles turned green and positive yesterday for the first time in a long, long time. You also saw a 12 month downtrend line broken to the upside which also helped change Groupon's momentum.

Daily Chart of Groupon Inc. (NASDAQ:GRPN)

With all of these positives happening to Groupon, how high can this stock go? [Read more...]

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