Weekly Report 4/12/20

Dow 1980 ,40 year cycle

We start by showing a chart of 1980 which we have pointed to before. The market will soon be at a moment of decision. Will we have a V shaped recovery, shown above, that continues to rocket higher after  a brief pull back over the next 10 trading days - or will we start to deviate from the 40 year cycle and work towards a W bottoming pattern with a low or higher low in early June? We will be prepared for either scenario and, either way the moves will be massive. 2000-4000 point moves on the Dow Jones allow for massive profit potential in either direction, long or short. There will be a tremendous amount of profit potential the next 60 days trading in the share market. We will alert our Gold Members with our new positions shortly!

Should new treatments for the virus be confirmed; this would put in a major floor in markets. As well, one can make the case that the true economic damage from Covid-19 has yet to show itself. Enter second quarter earnings/guidance and a new paradigm of a post-virus consume world. The crux of our economy is consumer spending. The markets are forward looking but, If the consumer takes his or her time to come back , stock markets will suffer.

A retracement is coming - not if but when. The chart above shows what we believe to currently be a maximum top on this recent move up. We entered long positions for gold members and our ourselves and captured a significant piece of this. We entered March 23rd the day of the current existing bottom. This is not a time to short this market. The pullback we expect may be shallower than shown on chart above. The Federal Reserve has released a Bozooka on the financial markets with the release of QE to infinity. We will be watching the end of April time period to enter positions on the stock markets.

We see a very large disconnect from spot gold which is currently $1685 per ounce as compared to the June futures contract, $1750. First, there have been logistical problems moving the metal around for delivery based on the virus. Secondly, last week was a holiday week and many bullion banks were not active shorting. The normal spread between futures and spot price is $6-10. When this spread widens gold typically pulls back. 1750 is significant resistance and 1800 is a brick wall. Not the best set up to go long gold in our eyes. Gold would become interesting to us on pullbacks. The next ultra bullish cycle for gold we have is a projected cycle low in June then up into the election, October of 2020. We expect a pull-back over the coming days. Depending on the size of the pull-back there may be opportunity.

We have not seen oil prices at these levels since the 1970s. This will be a highly volatile market , news driven, with the Saudis and Russians slugging it out over production limits. However, oil has gotten stretched too far to the downside that we see modest upside in the near future. Make no mistake though, oil is not headed back over $40 per barrel anytime soon. Demand is expected to be decreased for quite some time. Are you getting on a cruise ship or taking an unnecessary flight anytime soon? Probably not. 

We are alerting traders and investors that now is the time to become a a Gold member. Volatility like this comes around rarely and it equates to enormous profit potential. Great trades lay ahead.  The moves in various markets over the next 60 days should be spectacular.

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