Prepared By Robert Miner, Dynamic Traders Group, Inc. Major Trends Update Jan. 10, 2019 This Major Trends Report of most of the markets we follow on a regular basis in the DT Reports is a summary of the key technical positions of these markets and the probable major trends for the weeks and months ahead. There is a significant reliance on the Elliott Wave position to discover the probable trend positions and reversals. Most readers will have a working knowledge of EW 5-wave trends and simple 3-waves or combinations of 3-waves for counter trends. If you don t have a solid working knowledge of EW, you should get one. It is simple and helpful for almost all markets and time frames. Your subscription to a DT Report will include an ongoing EW education, plus there are many EW Trade Tutorials in the subscriber s archives. As a new service to subscribers, I will issue a Major Trends Report every 4-6 weeks to update the probable major trends of each market we follow and identify potential weekly if not monthly reversals. Fell free to email me your comments, suggestions or constructive criticism. If you think I ve missed something, mis-interpreted the current position or you have another perspective, I welcome your comments. I reply to all subscriber emails. As always, the analysis below will be updated on a regular basis in our regular DT Reports including identifying signals to confirm or invalidate the assumed trend position as well as specific Trade Strategies. I have produced an analysis and trade strategy report in one form or another for over 30 years. For the most part, I ve been on track for most major trends and reversals. But I have made some blunders over the years but have been relatively quick to identify (admit to!) mistakes. I ve learned to identify as best as possible what will confirm or invalidate the assumed trend position which is another way of a trader staying where is the sell or buy stop! I will continue to provide the best I have in what looks like exciting weeks and months ahead. I hope to continue to be of service to you in the years ahead. Regards, Robert Miner DynamicTraders.com DT@DynamicTraders.com Trading futures, stocks and Forex is risky and not for every investor. You could potentially lose all or more than your initial investment with leveraged positions. Past performance is no guarantee of future performance. Trade and invest at your own risk. Readers using this information are solely responsible for their actions and invest at their own risk. The information in this report is for the education of the reader and should not be construed as an offer to buy or sell securities. This information is supplied for the paid subscriber and may not be copied or distributed in any manner. Principles or associates of Dynamic Traders Group, Inc. may have positions in one or more of the markets discussed.
SPX Monthly Chart Comments The SPX had been on one of the longest Bull runs in history without a 20% or more correction from the March 2009 low into the Sept. 2018 high. The SPX has made a 20% decline into the Dec. low, but this should just be the beginning of a much more prolonged decline to at least June of this year, if not into 2020. Major Pattern Reversal Signal: The Dec. trade below the probable W.4:(5) low is a very high probability Pattern Reversal Signal that the Bull trend from March 2009 low should be complete. If this is the case, a typical correction would reach the area of the W.4 of lesser degree (May 2015 Feb. 2016) at 2135-1810 or a 27%-38% decline from the Sept. high. This overlaps a 50% retracement of the Bull trend from the March 2009 low if Sept. 2018 is indeed the W.(5) top. See the weekly chart and comments for the signal that would void the probable Bear trend. Page 2
SPX Weekly Chart The past month, the SPX made a major Pattern Reversal Signal by trading and closing below the probable W.4:(5) low. If April is indeed a W.4:(5) low as shown below and on the monthly chart, the W.(5) is complete, the Bull trend from the March 2009 low is complete, and the trend should be net Bear to at least June if not into early 2020. Whenever we identify what should be the higher time frame trend of a market, we must then identify what the market can do to void that outlook. In the present position of the SPX, a weekly close above 2658.69 is the initial signal the higher time frame trend is not Bear, the Dec. low is a W.C low with the potential to continue the Bull trend to a new high. If the SPX should make a weekly close above 2658.69, there are a couple of alternative scenarios where the net trend could remain Bear but with far less downside potential. I consider these alternatives low probability outcomes. We ll address those alternatives in the regular issues of the DT Report should a weekly close above 2658.69 be make. Page 3
What will confirm or invalidate a Bear trend? If a market strongly signals one trend or position or another, the first objective is to identify what will confirm or invalidate the assumed trend position. The SPX has given several Bear Reversal and Continuation Signals since the Sept. high to increasingly warn the Sept. high should be the W.(5) up from the 2009 low followed by a 9 months or more corrective decline. In other words, we would just be in the initial stages of this major Bear correction. Bear Continuation: An SPX daily close below 2510.03 (1/2 close) signals the Bear trend should continue to a new low. Bull Reversal Signal: A weekly close above 2856.69, the W.1 or A weekly closing low. Bear Trend Minimum Objectives: If the Bear trend continues as anticipated, the trend should be net Bear at least into next June and reach at least 2135 if not much lower. Trade the higher time frame trend. Execute on the shorter time frame trend. The regular DT Reports will keep you up to date on subsequent signals and alerts if the continuation or reversal signals are made. Page 4
Notes Monthly Chart and Comment In the past few weeks, the immediate technical position has clarified. The Oct. low should have completed a five wave decline from the June 2016 high and should be followed by a correction lasting several months. The recent high should just be a W.A of at least a three wave correction. A typical correction against the five wave bear trend from the June 2016 high should continue to July or later. Typically, a correction would last at least into Sept., the 38.2% Time Retracement. The ideal target for a correction is the 125 26-126 07 zone which includes the 50% retracement and 100% Alternate Price Projection of the W.(2). Page 5
Notes Weekly Chart and Comments The weekly chart clearly shows the impulsive advance from the Oct. low which also clearly implies the Jan. high is not a completed correction. A completed correction should not be a five wave impulse trend. With the weekly momentums DLB Bear Reversal this past week, a weekly, W.A high should be complete and a 3-5 weeks W.B corrective decline to follow. Page 6
10 Year Yields I have interest rate data going back to the 1750s. For over 200 years, rates have cycled from relatively low single digits to relatively high single digits (up to low double digits) every 16-20 years. If this consistent cycle continues, and there is no reason to believe it will not, whether we begin from July 2012 or July 2016, rates should continue to have a net advance for at least several years and eventually reach the high single digits. If this is the case, rates are only in the initial stages of a multi-year Bull trend and Notes and Bonds will have a net Bear trend for several years. Be aware of this potential and plan your long term borrowing needs accordingly. Page 7
Gold Monthly Chart and Comments Gold, silver and the GDX (gold mining stock ETF) have a high correlation to trend and reverse together. I am only going to discuss gold in this report. The comments apply to silver and the GDX which we cover in each issue of the DT Reports. While earlier this year, I anticipated that gold would eventually continue to advance to the 50% retracement if not more, the failure to exceed the July 2016 high this year and the April 2018 high reaching near the extreme in time (61.8% time Retracement, Aug. 2018) for a corrective advance strongly suggests the correction that began in Dec. 2015 should be an ABC flat and should be complete at the April 2018 high. Any advance should be a corrective rally and should not exceed the April high. Page 8
Gold Weekly Chart and Comments The advance off the Nov. low clearly appears to be a corrective pattern. It is potentially complete at the early Jan. high near the 61.8% retracement. Regardless if it is a major high or not, with the weekly momentums 4 weeks Dual Look Back OB, if the WE Jan. 4 did not complete a weekly high, the upside should be very limited before it is complete. The next weekly momentum Bear Reversal should be followed by at least 3-5 weeks sideways to down and reach at least 1251. Gold Trade Opportunity Immediate Trade Opportunity: Short following a daily close below 1285.80, the Jan. 4 close, for a probable 3-5 week net Bear trend if not longer. Page 9
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Dollar Monthly Chart and Comments The Wave Pattern of the monthly Dollar chart since the 2001 high is as textbook Elliott Wave as you can get! The most important message is the Dollar should continue the W.(4) correction from the Jan. 2017 high for many months, potentially for another year or two. The Feb. 2018 low fell far short of the minimum time typical for a W.(4) correction to the W.(3) which implies it is just a W.A of W.(4). The Nov. high is in the ideal position to have completed a W.B:(4) but needs continued decline to below the Sept. low as shown on the weekly chart. Note the prolonged W.(2) correction. 36 months and more than a 78.6% retracement of the W.(1). A W. (4) is typically greater in time than a W.(2) which implies the Dollar should be sideways to down off the Jan. 2017, W.(3) high into early 2020 or later. Page 11
Dollar Weekly Chart and Comments The Nov. high is in a position to have completed a W.B high. Need a trade below the Sept. low to confirm. With the weekly momentums DLB OS, a weekly low is near if not complete this past week. While a 3-5 week net Bull trend should follow, it is unlikely the Dollar will exceed the Nov. high. If it should, the upside should be limited to around the 61.8% Retracement. Regardless of the higher time frame pattern and trend, a 3-5 week net advance should begin soon. Dollar Trade Strategy Actionable Trade Setup: The Dollar made a daily momentum DLB Bull Reversal Thursday, Jan. 10 for a setup for a long or Bull trade that should last for 3-5 weeks. Page 12
The inevitable and possibly required disclaimer for market advisory reports. HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS & ACTUAL RESULTS ACHIEVED BY A PARTICULAR TRADING PROGRAM. ONE LIMITATION OF HYPOTHETICAL PERFORMANCE RESULTS IS THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK & NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. THE ABILITY TO WITHSTAND LOSSES OR ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS THAT CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM THAT CANNOT BE FULLY ACCOUNTED FOR IN PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULT Page 13