Best of the Week
Most Popular
1. Gold Final Warning: Here Are the Stunning Implications of Plunging Gold Price - P_Radomski_CFA
2.Fed Balance Sheet QE4EVER - Stock Market Trend Forecast Analysis - Nadeem_Walayat
3.UK House Prices, Immigration, and Population Growth Mega Trend Forecast - Part1 - Nadeem_Walayat
4.Gold and Silver Precious Metals Pot Pourri - Rambus_Chartology
5.The Exponential Stocks Bull Market - Nadeem_Walayat
6.Yield Curve Inversion and the Stock Market 2019 - Nadeem_Walayat
7.America's 30 Blocks of Holes - James_Quinn
8.US Presidential Cycle and Stock Market Trend 2019 - Nadeem_Walayat
9.Dear Stocks Bull Market: Happy 10 Year Anniversary! - Troy_Bombardia
10.Britain's Demographic Time Bomb Has Gone Off! - Nadeem_Walayat
Last 7 days
Stock Market Pause Should Extend - 21st April 19
Why Gold Has Been the Second Best Asset Class for the Last 20 Years - 21st April 19
Could Taxing the Rich Solve Income Inequality? - 21st April 19
Stock Market Euphoria Stunts Gold - 20th April 19
Is Political Partisanship Killing America? - 20th April 19
Trump - They Were All Lying - 20th April 19
The Global Economy Looks Disturbingly Like Japan Before Its “Lost Decade” - 19th April 19
Growing Bird of Paradise Strelitzia Plants, Pruning and Flower Guide Over 4 Years - 19th April 19
S&P 500’s Downward Reversal or Just Profit-Taking Action? - 18th April 19
US Stock Markets Setting Up For Increased Volatility - 18th April 19
Intel Corporation (INTC) Bullish Structure Favors More Upside - 18th April 19
Low New Zealand Inflation Rate Increases Chance of a Rate Cut - 18th April 19
Online Grocery Shopping Will Go Mainstream as Soon as This Year - 17th April 19
America Dancing On The Crumbling Precipice - 17th April 19
Watch The Financial Sector For The Next Stock Market Topping Pattern - 17th April 19
How Central Bank Gold Buying is Undermining the US Dollar - 17th April 19
Income-Generating Business - 17th April 19
INSOMNIA 64 Birmingham NEC Car Parking Info - 17th April 19
Trump May Regret His Fed Takeover Attempt - 16th April 19
Downside Risk in Gold & Gold Stocks - 16th April 19
Stock Market Melt-Up or Roll Over?…A Look At Two Scenarios - 16th April 19
Is the Stock Market Making a Head and Shoulders Topping Pattern? - 16th April 19
Will Powell’s Dovish Turn Support Gold? - 15th April 19
If History Is Any Indication, Stocks Should Rally Until the Fall of 2020 - 15th April 19
Stocks Get Closer to Last Year’s Record High - 15th April 19
Oil Price May Be Setup For A Move Back to $50 - 15th April 19
Stock Market Ready For A Pause! - 15th April 19
Shopping for Bargain Souvenirs in Fethiye Tuesday Market - Turkey Holidays 2019 - 15th April 19
From US-Sino Talks to New Trade Wars, Weakening Global Economic Prospects - 14th April 19
Stock Market Indexes Race For The New All-Time High - 14th April 19
Why Gold Price Will “Just Explode… in the Blink of an Eye” - 14th April 19

Market Oracle FREE Newsletter

Top 10 AI Stocks Investing to Profit from the Machine Intelligence Mega-trend

VIX Cycles Point to Stock Market Correction

Stock-Markets / Stock Markets 2018 May 17, 2018 - 03:20 AM GMT

By: Chris_Vermeulen

Stock-Markets

Recently, we authored an article about Fibonacci price levels in which we referred to a term called “Fibonacci Price Ladders”.  This is our own term, as far as we know, and we used it as a way to attempt to explain how price operates within the Fibonacci theory.  Our objective was to allow the reader to think of a standard ladder and how each ladder rung allows the climber to advance (move up) or decline (move down) using the ladder.  We hope it helped all of our readers to better understand the concept of how price rotates within a trend to establish longer-term price trends.


Within this post, we are going to revisit this Fibonacci Price Ladder concept to show you how recent price rotation may be setting up for a new, and possibly historical, price advance in the near future.  We urge our readers to revisit our earlier Fibonacci Price Ladder research to refresh your memory should you have any questions about this research.

Daily DOW Index Chart

This Daily YM Mini DOW Index chart shows the price rotation, downward, that moved directly to our Fibonacci support level near 24,600.  Technically, this constitutes a “new price low” formation and could foretell the end of this price correction before a new price advance begins.  If you remember, our prior analysis has indicated a very strong potential for a very strong price move higher from recent lows.  Yes, we expected this move and actually protected ourselves and our members by pulling profits in some trades near the highs last week.  Now that this move appears to be nearing completion with a proper Fibonacci price rotation, we believe a new price bottom will form quickly near the 24,600 level (with massive support existing above 24,400) driving a new price advance within days.

Daily ES Chart

This Daily ES chart helps to confirm the Fibonacci Price Ladder analysis by showing an even deeper “new price low” price rotation recently forming.  Massive price support exists in the ES between 2684 and 2700 and we believe this level will hold to form a price bottom/base before a new leg higher will advance price to new highs.

This Fibonacci Ladder process is simple to understand, once a new price high or low is established, any failure to continue to set new immediate higher highs or lower lows constitutes a potential failure of the current price trend.  So, if this recent low price move is a move to near a market base/bottom, then we should expect an upside price rotation to set up fairly quickly over the next few days.  We believe this will be the case and that traders should already be looking for new entry levels for the next leg higher.

Daily VIX Chart

This last Daily VIX chart showing Fibonacci Time/Price cycles shows that we are nearing a major cycle date, with resistance just above the current price of the vix.  We should expect the current downside stock market price to possibly extend downward, briefly, to establish a low price rotation and then reverse higher to begin a new upside price leg.

It is our belief that the VIX will stall near the resistance level and fall back to near or below $11 as the new upside price advance in the US majors extends to near all-time highs.

Currently, we see this price rotation as a healthy normal price rotation that is essential to a further price advance.  Price MUST attempt to rotate while establishing new price lows in order to establish new price highs.  This is healthy, normal price rotation that we believe will result in a larger price advance in the immediate future.

We are already searching for new entry triggers to take advantage of the future price leg higher.  If you are searching for ways to profit from this, and other future price moves, then visit www.TheTechnicalTraders.com to learn how we can help with Daily video content, extensive and proprietary research and price modeling, detailed trade triggers and analysis and more.  Our job is to assist you in becoming a better and more successful trader.

53 years experience in researching and trading makes analyzing the complex and ever-changing financial markets a natural process. We have a simple and highly effective way to provide our customers with the most convenient, accurate, and timely market forecasts available today. Our stock and ETF trading alerts are readily available through our exclusive membership service via email and SMS text. Our newsletter, Technical Trading Mastery book, and 3 Hour Trading Video Course are designed for both traders and investors. Also, some of our strategies have been fully automated for the ultimate trading experience.

Chris Vermeulen
www.TheTechnicalTraders.com

Chris Vermeulen has been involved in the markets since 1997 and is the founder of Technical Traders Ltd. He is an internationally recognized technical analyst, trader, and is the author of the book: 7 Steps to Win With Logic

Through years of research, trading and helping individual traders around the world. He learned that many traders have great trading ideas, but they lack one thing, they struggle to execute trades in a systematic way for consistent results. Chris helps educate traders with a three-hour video course that can change your trading results for the better.

His mission is to help his clients boost their trading performance while reducing market exposure and portfolio volatility.

He is a regular speaker on HoweStreet.com, and the FinancialSurvivorNetwork radio shows. Chris was also featured on the cover of AmalgaTrader Magazine, and contributes articles to several leading financial hubs like MarketOracle.co.uk

Disclaimer: Nothing in this report should be construed as a solicitation to buy or sell any securities mentioned. Technical Traders Ltd., its owners and the author of this report are not registered broker-dealers or financial advisors. Before investing in any securities, you should consult with your financial advisor and a registered broker-dealer. Never make an investment based solely on what you read in an online or printed report, including this report, especially if the investment involves a small, thinly-traded company that isn’t well known. Technical Traders Ltd. and the author of this report has been paid by Cardiff Energy Corp. In addition, the author owns shares of Cardiff Energy Corp. and would also benefit from volume and price appreciation of its stock. The information provided here within should not be construed as a financial analysis but rather as an advertisement. The author’s views and opinions regarding the companies featured in reports are his own views and are based on information that he has researched independently and has received, which the author assumes to be reliable. Technical Traders Ltd. and the author of this report do not guarantee the accuracy, completeness, or usefulness of any content of this report, nor its fitness for any particular purpose. Lastly, the author does not guarantee that any of the companies mentioned in the reports will perform as expected, and any comparisons made to other companies may not be valid or come into effect.

Chris Vermeulen Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules