Key levels for a "Trade Triangle" ALERT for all Major Indices

Posted on by The INO.com Team

Posted at 8:45 am EST.

Here are the key levels we are watching  today.

DOW: 10,268.71

NASDAQ: 2,163.07

S&P500: 1,076.69

A move this week below the above levels turn our weekly "Trade Triangles" red indicating a strong down trend.

54 thoughts on “Key levels for a "Trade Triangle" ALERT for all Major Indices”

  1. I started playing with the houses money today - BGZ until it either bombs or we go down to 9650. Thanks for the analysis.

  2. Adam, here we are trading at a significant support level of 10,000, would we break and close below it and head much lower?

  3. The economy has trillions of dollars US in cash in the magazines of corporate America's takeover weapons. When Corporate America doesn't want to look long term, it maraudes the financial canyons than create.

    Potash is just the opening shot. Could we see other takeovers on such stocks in precious metals, energy and retail? Gold seems to be heading up. Silver is holding its own. But iron and scrap are soft.

    In retail, could we see retailers with solid locations but hangovers from there previous acquisitions be targeted such as Walgreen or Rite Aid?

    Ric U.

  4. anyone short NFLX yesterday or today ? what do the trade triangles say ?

    thanks whomever...........

  5. HELLO - THE DOW IS IN THE EARLY STAGES OF DIVING BELOW 10,000 AS THE FED LET THE 'PROVERBIAL' CAT OUT-A-DA BAG LAST TUESDAY - HELLO!

    WE SHOULD SLAM/HIT HARD TO 9900 BY LABOR DAY. I WOULDN'T GIVE A RED INDIAN CENT FOR THE WALL ST & BANKING FIASCO IN THIS, NOW, 2010 BEAR MARKET OF AUGUST, 2010

  6. Anyone like a LONGERTERM view of TMV - FOR A 6MTH - 1 YR hold.
    I know its a tremendous loser now, and maybe has more to fall - but ,.,.,.,.
    thoughts?

  7. Adam,

    Of course there are no guarantees but I don't agree with the trade traingles on this one.......

  8. Adam, did your Trade triangles say to SHORT AKAM and the EURO recently before huge upmoves also
    On a percentage basis, how accurate is your trade triangles?
    Thanks in advance for your answer.
    Bush Or Obama?

    1. Rich,

      The question on how accurate are MarketClub's Trade Triangles is a good one and varies from market to market. The success rate is between 60 and 80 %.

      A better question might be is how profitable are the Trade Triangles? I think The Perfect Portfolio and "MarketClub World Cup Portfolio" answer that question very well. We have said this many time before, diversification and a game plan are the keys to success in the markets.

      All the best,

      Adam

      P.S. We got stopped out of AKAM and the EURO

  10. OK, so all the signals point to a short when the S&P trade is 20 points higher, which puts it on the high range of the resistant channel... it may not get that high. Maybe it's too early to collapse so move quickly if there's a bounce back on the rally. I think we'll keep rallying until something like Israel, or the straights and oil come to play... something bad... could be after Memorial day like everyone thinks. Things go a bit sour in Sept/Oct. Let me know what your doing, thank you.

    Adam, thank you very much, you're the best!

  11. Sorry if this is redundant but we did get the red triangle today on the weekly, is that correct? Thanks.

  12. Interesting... Keep your heads up and stop losses tight! Still some great winners out there!

  13. Hi Adam,
    Thanks very much for the heads up, I too was still watching the 1056.88 as my weekly signal
    for the ''Monthly / Weekly Double Red Triangle Combination.''
    So today I went short the S&P500 @ the 1,076.
    It looks like Mr.Market stuck his toe in the ''Bear Pond'' looking for some bottom.
    So if we get a bounce, I will add some more short -- ditto a new low below 1069.
    Cheers.

  14. Just to confirm ... since we broke through the key levels for all 3 indices this morning, your weekly “Trade Triangles” are now red (indicating a strong down trend). Correct?

  15. Hi Adam,
    Thanks for this great site.
    Do you see any confluence between your numbers and the Hindenburg Omen or do you see this purely as coincidence.
    Your insight is always appreciated.

    Regards,

    Kel

  17. Well, looks like ALL 3 INDEXES have intra-day successfully dropped below the stated trigger alert levels. That being the case , the Trade Triangles officially turn Red on the weekly, confirming a Strong Down Trend!!.

  18. This seem to indicate a bottom pickers paradise in the making. All the news is bad. The only point is whether there is truly poor news on the far side of this. Does the US lose its AAA+ rating? Do we become a 3rd rate nation?

    Or, do we stop this madness of manufacturing adverse economics?

    Ric

  21. The traditional definition of a Hindenburg Omen requires that:

    1. The daily number of NYSE new 52 Week Highs and the daily number of new 52 Week Lows must both be greater than 79. (Source: http://www.safehaven.com/article/3882/the-hindenburg-omen-a-potential-stock-market-crash-signal)
    2. The daily number of NYSE new 52 Week Highs and the daily number of new 52 Week Lows must both be greater than 2.2 percent of total NYSE issues traded that day.
    3. The NYSE 10 Week moving average is rising.
    4. The McClellan Oscillator is negative on that same day.
    5. New 52 Week Highs cannot be more than twice the new 52 Week Lows (however it is fine for new 52 Week Lows to be more than double new 52 Week Highs). This condition is absolutely mandatory.

    These measures are calculated each evening using Wall Street Journal figures for consistency. The occurrence of all five criteria on one day is often referred to as an unconfirmed Hindenburg Omen.

    A confirmed Hindenburg Omen occurs if a second (or more) Hindenburg Omen signals occur during a 36-day period from the first signal.

    The Hindenburg Omen mechanism can be applied to other stock exchanges like Paris, Frankfurt, Tokyo or Sydney but the criteria for it must overall be the same.

  22. Adam - does your algorithm take volume into account ? A drop below support on any index on light volume may not be very meaningful.

  23. Will you do the same calculation for some of the inverse etfs like EPV, QID, SDS and TWM etc?

    Thanks.

    1. Michael,

      Time is the enemy here. I can't promise this will be done. As a member (thank you for your business) you can create the same portfolio with the following rules.

      How "Trade Triangles" work in stocks and ETFs.
      The major "Trade Triangle" to watch in trading stocks is the monthly "Trade Triangle" as this triangle determines the trend. We use the weekly "Trade Triangles" for timing purposes. Let me give you an example, if the last monthly "Trade Triangle" is green this indicates that the major trend is up for that stock. You would then use the initial monthly "Trade Triangle" as an entry point and use the weekly red "Trade Triangle" as a stop out point. You would only reenter a long position if and when a green "Trade Triangle" kicked in. You would then use a weekly red "Trade Triangle" as a stop out point. Providing that a monthly green "Trade Triangle" is in place the trend is positive for the stock. The reverse is true if a red monthly "Trade Triangle" shows that the trend is down. You would then use the weekly "Trade Triangle" for entering and exiting the market.

      All the best,
      Adam

  24. Why did I not get this email until several hours later?

    John, New Traders Blog Post Alert
    Date: 8/16/2010 1:16:24 P.M. Eastern Daylight Time
    From:

    li*******@in*.com

    Is there a delay for a reason?
    JohnZ

    1. JohnZ,

      I recommend that you check our blog before the opening every day. It is by far the fastest easiest way to see alerts.

      All the best,
      Adam

  27. Thanks a lot for the videos and the updates. It really is a big help and is really apreciated.

  29. July 1 – Foreigners And The Bond Market –
    When bonds go up, the yield goes down. When the yield goes down, foreigners stay home. They don’t buy our currency they would have to have to purchase our bonds. If they don’t buy our bonds, the yield has to rise to a point where they come back to buy our debt.
    When the government deficit-spends, interest rates go up in tandem with commodity prices. When interest rates go up, our interest-rate entities become attractive. We must remember. The so-called Dollar Index is a basket of other foreign currencies vs. our currency. When the Dollar Index goes up, it can be because other currencies are going down. It’s a relative thing. When the currency in Germany depreciated after W. W. I., that currency fled to different markets, trying to hedge against its depreciating value. So, at one time, the real estate market was on fire, another timecommodities went up, another time it was stocks. At one time, the government had all the newspaper companies busily printing the currency, and it is told, that at one time it took a wheelbarrow full of paper to buy a loaf of bread. Don’t laugh, it could happen here.
    Now that the Congress has apparently dismantled the Constitutional monetary system initiated by the Founding Fathers, we think that rising interest rates will be the death knell that announces the death of the stock market and the economy

    Lawrence Sarsoun
    Author of “America’s Monetary Mess”

    July 8, 2010 THE FEDERAL RESERVE AND THE FOURTH OF JULY
    By Lawrence Sarsoun, The ETF Report

    At this time of the year, when we are meditating on the benefits of living in a supposedly free country, we should consider history. Like what happened in the second decade of the 20th century, 1910-1920. We are all familiar with the Marxist-Leninist takeover of half of the earth that took millions into slavery for most of the century. But few equate it to the curious events that took place in the U.S. during that same period. Consider the event that changed how we elected Senators. In those days, the legislators of the state would elect the Senator to represent the interests of the State. Then there is the introduction of the Internal Revenue and the Income Tax. We all know where that has led (Talk about slavery?!). Then the strange introduction of a central bank, the Federal Reserve (which is not really Federal- it is private, and has no reserves. The fed is supposed to be an agent of the U.S, But an agent is supposed to do the bidding of another, yet on the other hand, the Fed trumpets that it independent? Now, you can’t be both, an agent, yet independent. This is an oxymoron). And if they are supposed to be an agency, how come they show up in Congress weeks after the fact and tell us what they have already done!!
    We started off on the silver standard (Coinage Act of 1792). During the Civil War, President Lincoln wanted to borrow money from the bankers to run the war. But the bankers, being the scum that they are, wouldn’t lend (probably British and Rothschild-run) Lincoln conceived the idea to issue paper notes (the greenbacks) which promised to pay money (silver coins) after the war. Lincoln got a bullet in the head for his trouble, but the greenbacks were all eventually redeemed and made good.
    But the introduction of paper started us on the slippery slope of fiat money. With the initiation of a central bank, the door was open to the creation of the Federal Reserve note (FRN) Now, the FRN is a note for money. A note is an I.O.U., evidence of debt. Something was borrowed, and payment is not made until when and if the note is converted (redeemed) into money. That’s why, back in 1965, it said on the FRN

    This note is legal tender for all debts, public and private, and is redeemable
    in lawful money at any Federal Reserve bank or the U.S. Treasury

    Now, if the FRN was redeemable in lawful money, I like to say the FRN was not lawful money, it was “awful” money, i.e., it was a money substitute, and a poor one at that. But this legend flew in the face of article one, section ten, which says the states could only accept gold and silver coin as a tender in payment of debts. I went to the Fed and the Treasury in 1965 and tried to redeem the notes and they laughed me out of both places. So I was not surprised when the legend was eventually changed to something that roughly says, “Take It or Leave It”. And I was not surprised when silver was removed from our coinage. So now, we have no money! However, don’t feel bad, we have, therefore, no debt!
    What we are using for money is illegal, fraudulent, unconstitutional. Remember, the more they print of it, the less it is worth. The Emperor really has no clothes. Really. Therefore, the rule of the day has to be convert, convert, convert. Redeem, redeem, redeem your depreciating paper into things of value like food, clothes, guns and ammo, things that later can be used as money, like gold and silver.

    Lawrence Sarsoun
    Wren Services
    Author of “America’s Monetary Mess”
    321-259-4729

    July 15, 2010 Inflation vs. Deflation. The battle goes on between these two forces, trying to figure out who is winning. Meanwhile, everyone worries how to make things better. Free markets, however, go through catharsis, and despite the thrill of barfing one’s insides out, a certain piece comes to the body that has rid itself of the poison that was ailing one’s self, in time. For example, the housing market ate poison (easy money and all the ills of the last two or three years, etc.) rose to unsustainable levels, then proceeded to cleanse itself of all the silliness, and eventual, at a more reasonable level, will hopefully right itself and become whole once again.
    Another free market adjusting itself is the stock market. The key is that it is free (relatively speaking). So it can adjust to the distortions of the economy.
    However, there is one market that cannot adjust itself, because it is not free. It is manipulated (by law) and thus cannot adjust to this new paradigm. That market is the labor market and the manipulators are the Congress. Years ago, when I ran for (actually, against) the Congress, I wrote a booklet called “America’s Monetary Mess”. In that booklet, I said that there was a body more dangerous to the American people than the KGB and the Mafia combined, and that body was the U.S. Congress. I stand behind that statement to this day. By creating the Minimum wage law, they have made it impossible for wages to adjust to deflation, with the result that millions of Americans have been pushed out of the labor market and lost their jobs because there is no free market in labor to allow prices to adjust to a new paradigm. In the bible
    there is an interesting story (parable) of the employer who hired on laborers early on in the day at one price and later hired others late in the day at the same price. While the early hires yelled that this was not fair, when you think about the absolute economical sense of it all, the employer late in the day still needed to get something accomplished, so he was willing to pay as much at a later hour as he had paid the earlier hires. The parable illustrates the wisdom of having a free market in which owners and workers can settle on a fair wage to get something done. Ask an unemployed worker if he would like to go to work for a price less than the Minimum wage? Somebody go take a poll, quick. My feeling is that we are Americans and we like to work. Get out of our way, let us go back to work at some wage, so that we can finish buying our homes, pay our bills, pay our mortgages, buy a newer car, rebuild the economy. Free us from the tyranny of the Minimum wage and allow employers and employees the ability to contract with each other and settle with each other for a fair wage unencumbered by the strait jacket of the Minimum wage. Then watch things get accomplished like never before.

    Lawrence Sarsoun

    July 22, 2010 Chickens Roosting, Part II. Years ago, we wrote an article titled “Economic Consequences of Abortion”. The article foretold the disastrous results of killing off the next generation. The abortion Unlaw was decided upon by the Supreme Killers back in the 70’s. The children killed by this evil would have become added into the work force starting around the mid 80’s. Their absence has come to mean we do not have the benefit of their incorporation into our society, their ideas, their productivity, their taxes, their contributions to Social Security. In a publication that purports to be the very words of God, He states that children are a heritage. So when we allow the elimination of 25 million of our future citizens to our society, need we wonder that we are in big economic doo-doo? This nation was founded by men who centered their thinking around the strictures found in the aforementioned volume. They would be shocked by our behavior. Other cultures that we have allowed to come here, despite their outwardly expressed animosity toward us, our values and Judeo-Christian ethics, have been populating away, in fact, will soon have the numbers (already in Europe) sufficient to control the structure and direction of our culture.
    Having addressed one underlying fundamental cause to our distress, I cannot go away without offering some aid to our broken economy. We have talked about the Inflation-Deflation debate and controversy. We noted that some markets, being supposedly free, have had the ability to adjust price to reflect the wounds inflicted. Today, we would like to address labor and wages. Decades ago, when I wrote “America’s Monetary Mess” and ran against Congress, I called the Congress (in the book) more dangerous to the American people than the Mafia and the KGB. I still abide with that thought. With the passage of a Minimum Wage (I will not call it a law, since nothing in the Constitution gives the Congress such over reaching power to regulate contracts between employers and employees), the Congress has forced us into an artificially controlled economy where labor is not free to make unfettered deals with employers. So I suggest we abolish this so-called “law”, and allow people to work for other people at whatever price the two parties agree upon. Certainly we can all agree that a paper currency of doubtful and fluctuating value can be questioned as a yardstick for setting up a standard by which to measure the value of that labor. My bumper sticker would read
    I WANT TO WORK
    ABOLISH THE MINIMUM WAGE
    Now this act might do a lot toward getting America back to work again. Could it be that people who are interested in paying their bills, their mortgage, even eating, might be persuaded to return to work at some given wage? We’ll never know unless we give it a try.

    L. Sarsoun
    August 5 – Watching Interest Rates – Every day, we watch CNBC, and one of the things we especially watch is the yield on the 30 year bond. And the pattern is pretty much the same. Overnight, the yield falls, and every day, during the day, the yield climbs

    This past week, in reviewing my recommendations (I follow about 54 items), I noticed that almost all of the commodity-related items
    were in bullish mode. Stocks, oil, natural gas, agriculture, metals, currencies were all bullish. I thought, this can’t last forever with interest rates at historically-low levels, something’s got to give, folks. When I wrote my booklet 40 years ago (Prices and the Prime) for a major brokerage firm, we had been tracking the CRB index vs. the Prime Rate, and we noticed that the two indices went up and down in tandem with each other. The price(cost) of money is reflected in its interest rate, so as time went by, the 30 year return became so attractive, that people dumped their commodities, they liquidated stuff like pork bellies and soybeans so that they could buy the long bond and lock in a very attractive return FOR 30 YEARS!!! Now, we have the horse out of the barn again (shades of the late ‘70s) and interest rates are ridiculously low. Something’s not right, folks. Fool me once, shame on you, fool me twice, shame on you!
    I hate to sound like a broken record, but the symbols are TBF and TBT. These ETFs reflect yields. When yields go up, so will these two. Our currency, which I personally think, is illegal, immoral, and unconstitutional, fell to an index of 80 vs. other currencies in the basket, our currency fell this past week in purchasing power vs. most important hard items. Perhaps investors (especially foreigners) are getting out of the paper going into companies that hold assets with intrinsic value, like manufacturing capability, but all American companies are denominating their activities in this depreciating currency. This lack of knowing what you are dealing with will, some day, come back to bite us. The Emperor does NOT have any clothes on.
    Week of August 9th – The Emperor has No Clothes – We are firmly convinced that the idiots we call the Federal Reserve are either 1) super-Crooks of the Nth degree carrying off the greatest scam of all time, or 2) the Stupidest fools of all time. Contrast that to the simplicity and honesty of the system put together by our Founding Fathers. It calls for a bi-metallic money based on a dual commodity, two commodities system based on a centuries-old history of integrity, intrinsic value, using two attractive and malleable substances, gold and silver. This bi-metallic process firmly entrenched for over a century, this system was overthrown and hi-jacked by evil men, thieves, who conned an ignorant populace through sleight of hand and surreptitiousness.
    Let us explore our basic law document, the Constitution, and see if we can understand how this system works. Article 1, section 8, says that we, the people, are in charge, and the powers of the Congress, our representatives, come from us. We gave Congress, not the Federal Reserve, the power to coin (not PRINT) money, and article 1, section 10 prohibits the States from using any thing but gold and silver coined money as tender in payment of debt. So if the Congress is given the power to coin money, what does that coin have to be, wooden nickels, cupro-nickel slugs, kowrie shells, wampum? No, the coined money must be coined gold and silver. Now that we know what money in this country is supposed to be, it says Congress can borrow money (the coined gold and silver). Now comes the crucial point – Is there a finite amount of gold and silver on planet Earth that can be mined and coined into money? Yes! So therefore – is there a finite amount of coined gold and silver money that can be borrowed by the Congress of the United States? Yes! Therefore, we can, with confidence, declare that paper notes that are not redeemable in such money are bogus, unconstitutional, and immoral. The more they print of these things, the less they are worth. Whose notes are they? Take that paper out of your pocket or wallet and read what it says. Sucker. We have built our house of cards, this house of paper, on these things. Protect yourself, convert, get out of paper and convert to something of inherent value. If there were chaos, would your family have something to eat for awhile? Buy some food. Wheat has just soared to over $7 a bushel. Get some silver in small denominations that can hold your wealth and can be used for small purchases. Water, do you have a supply of water for your household?
    And finally, read your Constitution and come to understand it. It does not have to be interpreted by a Supreme Court. It is not written in Swahili or some foreign language. It is written in fairly simple, straight

  30. My guess is that the support number changes from day to day. Although that doesn't make sense on a horizontal support line. It must be a diagonal support line since the number is 20 point higher. Pull up a chart and draw some trend lines.

  31. triangles are red for market, but everything i am in is green,

    for example, AWF, ESD, TGP, MMU, MQY, TLT, IEF, PFF, TYW, NNN, SLV, EEP, EDD, MWE, CPNO, BND, LQD, CRT, SJT,

    should i dump them because market went red or should i keep them because as individual stocks they are green

    1. Paul,

      If the markets you are in are showing green Trade Triangles stay with them.

      Good luck and all the best,
      Adam

  32. HI Adam
    Based on this Siganl, is it a fair and high precentage trade to go Short this market now?
    Thank you

  33. thank you for sharing your insight adam

    i have been short the mkt for a while which didn't look to be working up until a few days ago................i really really appreciate what you share with us all

    THANK YOU THANK YOU

  34. Do you mean on a closing basis? The DOW and SPX have already traded below your numbers today. Don't follow the NASDAQ, so I don't know about that one.

  36. 2 questions:

    1. is this closing or intra-day?
    2. I assume that the key levels are based on your agorithm and not a typical MA?

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