The FTSE 100 remained on the back foot by mid-morning, down 4 points or 0.045% at 7,775. Not only was it a quiet start, things aren’t likely to get much busier as the day progresses because Wall Street is closed for the Martin Luther King Day public holiday. In absence of major trading catalysts, expect …
The German DAX 30 was down by 0.35%, while the British FTSE 100 retreated by 0.11% mainly due to weaker technological shares. In other news of the UK, the British construction firm Carillion collapsed after the government’s efforts to reach an agreement with the company’s creditors failed. Even if …
Overall the FTSE 100 was suffering from blue Monday malaise, down 6.5 points at 7772.9. But GKN was making gains after potential suitor Melrose said it was gearing up for a hostile battle for the engineer. Melrose said it is commending a series of shar…
Our trading partner Chris Vermeulen has our readers off to an amazing start for 2018. If this is any sign of what we have to come this year we are in store for one of our best years of trading possibly ever.
Chris just sent over his latest article and it explains how our old reliable Transportation Index is guiding the way once again. Read “How to Know if This Rally Will Continue for Two More Months”.
Our research has been “spot on” with regards to the markets for the first few weeks of 2018. We issued our first trade on Jan 2nd, plus two very detailed research reports near the end of 2017 and early 2018. We urge you to review these research posts as they tell you exactly what to expect for the first Quarter in 2018.
Continuing this research, we have focused our current effort on the Transportation Index, the US Majors, and the Metals Markets. The Transportation Index has seen an extensive rally (+19.85%) originating near November 2017. This incredible upside move correlates with renewed US Tax policies and Economic increases that are sure to drive the US Equity market higher throughout 2018.
In theory, the Transportation Index is a measure of economic activity as related to the transportation of goods from port to distribution centers and from distribution centers to retail centers. The recent jump in the Transportation Index foretells of strong economic activity within the US for at least the next 3 months.
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One could, and likely should watch the Transportation Index for any signs of weakness or contraction which would indicate an economic slowdown about to unfold. In order to better understand how the Transportation Index precedes the US Equity markets by 2-5 months, let’s compare the current price activity to that of 2007-08.
This first chart is the current Transportation Index and shows how strong the US economic recovery is in relation to the previous year (2017). As the US economy has continued to strengthen and open up new opportunities, the Transportation Index has related this strength by increasing by near +20% in only a few short months. This shows us that we should continue to expect a moderate to strong bullish bias for at least the first quarter of 2018 – unless something dramatic changes in relation to economic opportunities.
In comparison, this chart (below) is the Transportation Index in 2007-08 which reacted quite differently. The economic environment was vastly different at this time. The US Fed had raised rates consecutively over a two year period leading up to a massive debt/credit crisis. At the same time, the US had a Presidential Election cycle that saw massive uncertainty with regards to regulation, policies and economic opportunities. Delinquencies as related to debt had already started to climb and the markets reacted to the economic alarms ringing from all corners of the globe. The Transportation Index formed a classic “rollover top” formation in late 2007 and early 2008 well before the global markets really began to tank.
Our analysis points to a very strong first quarter of 2018 within the US and for US Equities. We believe the economic indicators will continue to perform well and, at least for the next 3 months, will continue to drive strong equity growth. We do expect some volatility near the end of the first Quarter as well as continued 2-5% price volatility/rotation at times. There will be levels of contraction in the markets that are natural and healthy for this rally. So, be prepared for some rotation that could be deeper than what we have seen over the last 6 months.
In conclusion, equities are this point are overpriced, and overbought based on the short term analysis. We should be entering slightly weaker time for large cap stocks over the next couple weeks before it goes much higher. Because we are still in a full out bull market, Dips Should Be Bought and we will notify members of a new trade once we get another one of these setups.
In our next post, we are going to talk about two opportunities in precious metals forming for next week!
Read the analysis we presented before the end of 2017 regarding our predictive modeling systems and how we target our research to helping our members. If you believe our analysis is accurate and timely, then we urge you to subscribe here at The Technical Traders to support our work and to benefit from our signals. We believe 2018 – 2020 will be the years that strategic trades will outperform all other markets. Join us in our efforts to find and execute the best trading opportunities and profit from these fantastic setups.
Chris Vermeulen
Technical Traders Ltd.
The hotel has been a luxury detention centre for dozens of princes held on suspicion of corruption.
The FTSE 100 drifted 7.9 points lower to 7,770 as subdued investor sentiment put banking stocks and utilities under pressure. Among the biggest fallers … Midcap Melrose (MRO) was still keen on taking over FTSE 100 engineer GKN (GKN) despite its offer…
If anyone was in any doubt that the collapse of Carillion is bad news for the taxpayer you only need to take a glance at the share prices of its outsourcing rivals this morning. Against a flat FTSE 100 opening Serco shares are up by 4.42 per cent, G4S by 4.1 per cent and Capita 4.65 per cent. And that’s no …
The European planemaker says it will stop making its giant A380 jet if it does not get any more orders.
The Detroit motor show is a major industry event, but technological advances are changing the traditional order.
The euro strengthened against its major counterparts in the European session on Monday, as speculation intensified that the European Central Bank is preparing to unwind its massive stimulus sooner than anticipated.
Hopes of a shift in the ECB stance …
Both sides will tour the City to convince fund managers their strategy will deliver more value ahead of a February 5 deadline for Melrose to make formal a bid for the FTSE 100 engineering giant. Top GKN shareholders are BlackRock, Vanguard, Deutsche Ba…
Melrose has sketched out its strategy to turn around acquisition target GKN, saying the FTSE 100 engineer lacks “clear focus” and “needs fundamental change”, as analysts predict it will improve its offer for the aerospace and automotive group. The turnaround specialist made an £8bn approach for GKN …
The FTSE 100 (INDEXFTSE:UKX) edged downwards this morning on track with its European counterparts as Carillion’s rivals benefited from the UK’s second biggest construction company’s demise. The blue chip share index fell 0.15%, down 11 points at 7,766.95 by 11.17 GMT. Carillion’s downfall, with …
LONDON, Jan 15 (Reuters) – The following FTSE 100 companies will go ex-dividend on Thursday, after which investors will no longer qualify for the latest dividend payout. According to Reuters calculations at current market prices, the effect of the resu…
Ireland’s foreign trade surplus decreased in November, as exports fell and imports rose, data from the Central Statistics Office showed Monday.
The seasonally adjusted trade surplus fell to EUR 3.51 billion in November from EUR 3.86 billion in Octobe…
Johnson Matthey PLC (LON:JMAT) found support today from an upgrade in rating by German broker Berenberg to ‘buy’ from ‘hold’ saying it believes the specialty chemicals firm’s stock offers an electric car battery “opportunity for free”. The broker also raised its target price for the FTSE-100 listed firm to …
Johnson Matthey PLC (LON:JMAT) found support today from an upgrade in rating by German broker Berenberg to ‘buy’ from ‘hold’ saying it believes the specialty chemicals firm’s stock offers an electric car battery “opportunity for free”. The broker also raised its target price for the FTSE 100 listed firm to …
Latvia Nov Current A/c Surplus EUR 74 Mln Vs. EUR 95 Mln In October
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Ireland Nov Exports Down 1% On Month, Imports Up 4%
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Ireland Nov Trade Surplus EUR 3.51 Bln Vs. EUR 3.86 Bln In October
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In this video, the Trader Guy looks at the cryptocurrency, bitcoin for the January 15th session.
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Spain’s IBEX 35 was fractionally higher at 10,466.90. The U.K.’s FTSE 100 index was off 0.1% at 7,773.41 (http://www.marketwatch.com/story/ftse-100-steps-back-from-record-with-carillion-collapse-in-focus-2018-01-15) after Friday’s record closing high. The euro bought $1.2263, rising from 1.2200 late …
The success of forex trader depends on many aspects. Among them is the ability to comprehensively see the situation in the financial market. Fundamental analysis is one of the main types of market analysis. It represents a study of the political and financial situation in some important countries. The financial situation of every country forms the rates of the national currency. Traders who trade according to the fundamental analysis have to be aware of the political situation of the world’s major countries. A trader […]
Ravi Menon, who is the chief of the Singapore’s de facto central bank, expressed hope on Monday that technologies underpinning cryptocurrencies and the blockchain would survive a crash in the former, news agency Reuters reported.
The Managing Direct…
The U.S. dollar slipped against its major opponents in early European deals on Monday.
The greenback fell to near a 3-month low of 0.9616 against the franc and a 4-month low of 110.53 against the yen, from its early highs of 0.9685 and 111.18, respec…
Company boss Richard Branson says he was unaware of the decision to stop stocking the newspaper.
Not only was it a quiet start, things aren’t likely to get much busier as the day progresses because Wall Street is closed for the Martin Luther King Day public holiday. In absence of major trading catalysts, expect more commentary around Carillion’s downfall. “It appears to be the end of the road for …
The euro area trade surplus increased in November from October, data from Eurostat showed Monday.
The trade surplus rose to a seasonally adjusted EUR 22.5 billion from EUR 19 billion in the previous month.
Exports grew 3.4 percent month-on-month to…
U.S. Dollar Dips To Near 4-month Low Of 0.7296 Against Kiwi
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U.S. Dollar Slides To 1-1/2-year Low Of 1.3808 Against Pound
The material has been provided by InstaForex Company – www.instaforex.com
