Alarming Signs of a Current S&P 500 Top

Alarming Signs of a Current S&P 500 Top

I have repeatedly gone against the grain this year and called for higher US stock market prices when everyone else was calling for the sky to fall. Today, I’m seeing alarming signs of a possible current S&P 500 top.

As for our bullish calls this year, let me briefly revisit them. There was:

  • The SSI entry signal on the S&P 500 back in April.
  • The post-Brexit rally / Ameribuy call in July.
  • The most remarkable trade of the year call in October.
  • The Trump rally call in November.

All throughout the year, I cautioned readers against buying too much into the “sky is falling” narrative. So why am I warning of a possible top today? Let’s take a look.

My biggest concern about the ability of the current rally to continue comes from my time-cycles analysis. All year long the time-cycles have been very accurate … and they’re currently signaling a top in January.


As I’ve said many times before, I use time-cycles to know which way the wind is blowing. Just because the winds might be blowing south, doesn’t mean by itself that the stock market can’t keep heading north. There are other reasons, however, to be cautious.

Our “smart-money” sentiment indicator, the commercials commitment of traders report, is also signaling headwinds ahead for the stock market. The smart-money market players have been hedging their bets on this rally most of this year … and they continue to do so today.


Commercial hedgers can be wrong for months at a time (they have a lot more staying power than most of the rest of us) but eventually they tend to be proven right (and collect their winnings accordingly).

Finally, our volume-at-price analysis shows that the S&P 500 has built up a significant amount of overhead volume here at the 2,250 – 2,275 level. It’s not an overwhelming resistance but it is enough to require some extra oomph to break above these levels and I just don’t see where that extra energy is likely to come from.


Let me end by reminding us all that “staying in your winners” is one of the cardinal rules of the TradeStops system. The SSI indicator on the S&P 500 is still solidly in the green zone … and that isn’t to be taken lightly.


But it is most certainly a time to be cautious … and not overreach for more stock market gains. The S&P 500 is up nearly 10% since Trump’s election victory. No one really knows what a Trump presidency is going to look like. I’m not even sure the Donald himself knows.

At a minimum, there is bound to be some turbulence along the way … and my indicators are suggesting that it is probably time to turn on the “fasten your seatbelts” sign.

As my colleague Tom Meyer suggested earlier this week, it’s a good time to make sure your portfolio is ready to weather any storm.

It’s been a great year here at TradeStops. I’m very proud of what we’ve accomplished and very appreciative of your confidence and your business.

I wish you all a happy and prosperous 2017,

Richard Smith, PhD
CEO & Founder, TradeStops

Get Answers Faster with New “Feedback” Feature

A little while ago, we sent you an article explaining our exciting chat feature. Many of you have taken advantage of this and have been chatting with our agents.

Let’s say it’s after hours, though, or that you don’t want to use the chat feature. You would rather send us an email to explain the problem. Well, you can do that right from inside the program too!

It’s called Usersnap, and you’ll find it by clicking Feedback.

Usersnap: Fun and Handy
To start using the Usersnap email, just click the Feedback button. You will find it in the bottom right corner of your TradeStops program.


This will display the Usersnap dialog box where you can write an email and include a screenshot.


(Please note that a Title is required)

Including a screenshot is very easy.

  1. A crosshair will appear in place of your mouse pointer after clicking Feedback.
  2. Click, hold, and drag across the area that you want to take a picture of.
  3. After you take the picture, you can mark it up with the Highlight tool.


4. Simply click send, and the information will be sent to a customer service agent.


Please Remember

There are a few things to keep in mind.

  • Our agents are not financial advisors. They cannot give you financial advice.
    They can explain aspects of the program, though.
  • Cancellations and upgrades cannot be processed through email for security purposes.
    Please give us a call at 866-385-2076 instead.
  • We may not answer your email immediately.
    Our agents will do their best to answer your email within 48 hours.
    If you want an immediate answer, please call us or chat with us.

Usersnap is here for you
Try using Usersnap today. See how you like it and how easy it is to send us a screenshot of the problem you are encountering or the question you have. We think you’ll like it.

Until next time,
TradeStops Customer Success Team

How to Invest Like a Pro in 2017

With only a few trading days left in 2016, many investors are making their resolutions for 2017.

“Next year I’ll follow the trading signals.” “In 2017, I’ll get rid of the stocks that are hurting my portfolios.” “I’ll set up my portfolios for the best return possible really soon.” And the big one, “Next year I’ll stop being so emotional with my stock picks.”

Why wait? There’s no better time than the present to look at your portfolio in the same way that a professional would and figure out how to invest like a pro in 2017!

Have any losses from 2016? Then consider “harvesting” those losses. Tax-loss harvesting means selling the stocks that are losing money. You can use these losses to offset the capital gains you’ve made in other stocks throughout the year. If your losses are more than your gains, you could potentially carry forward these losses into 2017 and beyond.

After a pro has finished harvesting his losses, the next thing he does is take a look at his portfolios and determine if he is invested too heavily in one or two sectors. The TradeStops Asset Allocation tool can help you with that. It gives you a quick overview as to how you’re invested from a sector or industry perspective.

This sample portfolio has over 34% invested in the consumer discretionary sector. Having that much money in a single sector could mean that it’s overweighted in your portfolio.

how to invest

The next thing that a professional would do is to see if there are any potential “time bombs” in his portfolio. These are stocks that could damage a portfolio by pulling down overall returns. These stocks should be considered for removal from the portfolio.

TradeStops Premium makes this task simple. Just go to the Risk Rebalancer and have all of the stocks that are in the SSI Red Zone removed from the portfolio. The Rebalancer will reallocate the funds from these potentially destructive stocks into those that are better-positioned to move higher.

Here’s a sample portfolio that has 11 positions, and 3 of those are in the SSI Red Zone.


We can remove the stocks that are in the Red and reallocate the funds into the stronger stocks.

And we’ll take the exact same dollar risk per position. This is how a pro is able to stay in trades for a longer period of time and maximize the potential gains.

This is what the same portfolio looks like after removing the red and right-sizing the remaining positions.


In this example, there is $1422 of risk in each stock. That means you can own 321 shares of GE but only 34 shares of NFLX.

If the only thing you did this year was to rebalance your portfolio so that you’re right-sizing your positions and taking the same amount of dollar risk in every trade, the long-term results could be outstanding.

Here’s an example of one investor who went from a loss of $100,000 to a gain of almost $60,000 just by right-sizing his portfolio.


I’ve heard predictions for 2017 that run the gamut from new all-time highs at the end of the year to portfolio-crushing bear markets. I don’t know if either of these will be correct or if somewhere in the middle is the more likely outcome.

I do know that by managing your portfolio like a pro using the TradeStops tools, you’ll give yourself the biggest opportunity to succeed profitably in the years to come.

Here’s to profitable New Year’s resolutions,

Tom Meyer,
Education Director, TradeStops

The DPZ Domino’s Pizza Trade – Slice by Slice

Last week, Dr. Smith wrote How to make a killing in pizza. He discussed a trade in Domino’s Pizza (DPZ) using the tools and research that have been introduced this year in TradeStops.

Today we’re going to slice that trade and show you the step-by-step process he used to make this happen.

The chart shows that DPZ hit a low in 2008 below $4 a share. It triggered an SSI Entry signal in early 2010 at just under $10 a share and has been moving higher ever since. (Note that the chart uses a log-scaled “y” axis … each gridline is a 100% gain.)


This is a great example of the power of investing with momentum and “unlimiting” your gains by staying invested for as long as the stock continues moving higher.

Another important element in the success of investing in DPZ is the concept of “doubling-up on the way up.” This means adding to the position every time the stock moves 2 Volatility Quotients higher (for instance, if a stock trades for $100 and the VQ is 10%, then the stock must rise 2 x 10%, or 20%, before adding to the position).


Another element that made this trade so compelling was the pent-up momentum in the stock after crashing in 2008. The Volatility Quotient spiked throughout 2008 from the 20% level to above 40% and plateaued there until 2011 when it began moving lower. Our research has shown that these types of moves can act as fuel to propel a stock higher over a multi-year period of time.


We determined that at each entry point along the way, we were going to buy $250 of risk. In other words, we wanted to take $250 of risk in each purchase of DPZ. How did we figure out what the investment should be?

The Position Size Calculator makes it easy. Here are the parameters we want to use to determine the amount of stock to buy. For the initial purchase of DPZ in 2010, the price of the stock was $9.73, and the Volatility Quotient for DPZ was 43.13%. This is how we set it up in the Position Size Calculator.


Why did we use a Trailing Stop of 43.13%? Because that was the VQ for DPZ at the time that the SSI Entry signal was triggered in 2010.

Now let’s calculate this and see how many shares we could buy.


The analysis shows us that we could invest $574 and buy 59 shares of DPZ for our $250 of risk.

You can do the same analysis for the other six purchases of DPZ. Remember, you’re only going to take $250 of risk in each position.


And here are the results through December 15th of buying just one time when the SSI Entry signal was first triggered vs. buying at the Entry signal and then each time that DPZ moved 2 VQs higher.


And here are the results through December 15th of buying just one time when the SSI Entry signal was first triggered vs. buying at the Entry signal and then each time that DPZ moved 2 VQs higher.

This chart shows the results of each purchase.


We’ll be giving you more examples of this type of trading strategy in the future.

Nobody knows how long a stock can continue to move higher. And at some time the run will end. But in the meantime, we need to find ways to make as much profit as possible as our “once-in-a-lifetime” stocks climb higher.

And TradeStops will be here to help you Make More and Risk Less.

Best wishes from all of us at TradeStops for a healthy, happy, and prosperous 2017.

Tom Meyer
TradeStops, Member Services

When Will the Pain End For Gold Investors?

Gold vs. Dollar?

Since the US presidential election, the US dollar has headed straight up … and gold has headed straight down. When will the pain for gold investors finally end? I think sooner rather than later, though a lot depends on the fate of the US dollar.

Since late spring / early summer, when the US presidential campaign really began heating up, the negative correlation between gold and the USD has been startling. In fact, the negative correlation dates all the way back to mid-2015.

gold vs. dollar

A year ago, gold was at its lowest point of the year, trading in the $1060 range. It moved higher in the first half of the year and topped at the $1360 level in the first week of July.

On the other hand, the US Dollar was trading near a high one year ago and moved down to the 93 level at the end of June. Since then, it has been steadily moving higher, culminated by the spike after the Trump election in November.

The SSI chart for both gold and the USD tell the same story as well.

Gold had a great run for the first half of 2016, but, as we feared, has been suffering since July.


The USD, as we predicted, bottomed over the summer and has been on an absolute tear this fall. It triggered an SSI entry signal in November right after Trump’s election.


The volume-at-price (VAP) charts that we like to look at for support and resistance don’t offer much encouragement either, I’m afraid.

Gold moved lower underneath an area of support in the $1150 range and now looks to have a downward momentum to the $1070 level.


On the other hand, the dollar is in no-man’s land after its spectacular rise. There is no resistance in place at this time to stop its move higher.


That’s the bad news for gold investors looking for some dollar downside and gold upside. Looking out a bit further into the future, however, it’s not all doom and gloom. In fact, there are some reasons to be seriously optimistic.

The commercial traders of the dollar seem to be locking in prices as the Commitment of Traders report shows bearish holdings by the hedgers on increasing open interest.


Look at what happened in late 2014 and early 2015 as the traders held large bearish positions at the same time that open interest was increasing. This pattern seems to be repeating now.

My time-cycles forecast for the dollar remains bullish, into the early part of 2017 but strongly suggests that we should see a top in the dollar rally in the next 30 to 45 days.


As for gold itself, I’m waiting for the commercials to build a bigger position before I get super-bullish but the long-term cycle in gold is definitely heading up, and commercial players have begun accumulating a new position.


When gold does bottom and finally start its long awaited ascent, …I think that it’s going to be huge.

May your holidays be merry and bright!

Richard Smith, PhD
CEO & Founder, TradeStops

How to Make a Killing in Pizza

I was in college in the late 80’s when Domino’s Pizza was the fastest growing franchise business in the country because of their promise to deliver a pizza to your door in 30 minutes or less.

It was clearly a quantity over quality play … and the lack of quality caught up with them. For me, Domino’s was what you ordered when there wasn’t anything else available.

That’s why I was astonished when I asked my team to find a great example of a stock that captured some of the highlights of our research this year … and they came back to me with DPZ – Domino’s Pizza.

Unbelievably, DPZ went from a low of $3.86 per share back in late 2008 to a recent high of $169.24 per share. That’s a gain of over 4,200% … a 42-bagger. Here’s the latest SSI chart on DPZ. (Note that the chart uses a log-scaled vertical axis … each vertical gridline is a 100% gain.)

dominos stocks

Those are the kinds of profits that all of us need to experience at least a couple of times in our lives as investors … and they are exactly the kinds of profits that the tools of TradeStops are designed to capture.

TradeStops triggered an SSI entry signal on DPZ way back in January 2010 at just under $10 per share … and it hasn’t been stopped out since.

I love seeing these kinds of charts because I know that had I been faced with an SSI entry signal at $9.85 per share on a stock that had been trading at $3.86 per share just a year ago, it would have been hard to pull the trigger.

Who wants to buy a stock that is already up nearly 200%? Today I can happily say, “I do!”

Clearly, DPZ is a great example of the research we’ve been sharing this year on the power of Going Green. Had you bought when the SSI on DPZ first turned green back in early 2010, you’d be sitting on gains of over 1,500% today. That’s the kind of green that anyone can love.

DPZ also beautifully demonstrated how a buildup in volatility “energy” can be a trigger of multi-year gains. Over the past 20 years, the average VQ on DPZ has been 25%. That’s reasonable volatility.

domino's stocks

From 2007 to 2010, the VQ doubled from a low of 20% to over 40%. For the past 6 years, DPZ has been feeding off that peak in volatility to fuel its multi-year profitable trend.


The final piece of our 2016 research that is illustrated by our DPZ example is the concept of adding to a winner. We introduced this idea in our November piece on Doubling Up … On your Winners.

It’s a very common practice to “double down” on investments that have fallen in price. It’s almost unheard of to “double up” on winning investments. Our research showed that this can be a very powerful strategy.

Had we followed our “add to a winner every 2 VQ’s” on Domino’s, we would have added another leg to our position at each of the blue arrows here.

domino's stocks

The chart below shows the extra profits that this “adding to winners” strategy could have generated in DPZ. All of the “buys” used in this study are based on a risk of $250.

The black line is the profit generated from buying once at the initial SSI entry signal. Risking $250 back in 2010 generated profits of about $9,000.

The blue line is the profit generated by adding to a winner and risking an additional $250 every time DPZ made another 2 VQ’s of gain.

domino's stocks

These types of gains don’t happen often. I’ve said a number of times that to be a successful investor, you must know how to “unlimit” your gains. In other words, let your winners run for as long as they will keep moving higher … and consider adding to your winners along the way.

Domino’s may be known for delivering pizzas, but TradeStops is known for delivering profits.

To tasty investments,

Richard Smith, PhD
CEO & Founder, TradeStops

Know the Right Amount of Risk

Last week, TradeStops introduced its last major upgrade of 2016. Our development team upgraded the TradeStops Position Size Calculator to make it more user-friendly and to give you more information at a glance.

The Position Size calculator now lets you determine either how much risk you’re taking in a position based on your total investment or how much you should invest in a position based on the amount of risk you’re willing to take.

Let’s take a look.

The Position Size Calculator is in the same place as it was before. Just click on the “Research” tab and then on the “Position Size” tab. Here’s what the screen looks like.


(Click on image to enlarge.)
Now let’s look at each section. For this example, we’ll use Facebook (FB). FB triggered an SSI Entry signal in April, 2014 and has been moving higher all this time, more than doubling in price. The most recent high on the stock was in October and the stock has moved a little lower in the past two months. It’s still a long way from its SSI Stop price of $103.70.


In the top section of the Position Size calculator, we’ll enter the symbol FB. The Entry Price box will automatically be filled in with the previous day’s closing price.


If we want to enter a different price, we can go in and change it manually. If we want to look at an option or if we want to consider a short position, all we have to do is click those boxes.

The middle section allows us to look at FB from two perspectives. First, let’s look at how many shares of FB we can buy if we know how much money we are willing to risk. Let’s assume that we are taking $1500 of risk in each stock. So, we’ll click on the “Risk” box, then we’ll select the “Custom” box, and we’ll enter $1500.


We’ll come back to the “Invest” box in a moment.

Now, let’s look at the bottom section. The Position Size calculator lets us look at different stops based the SSI Stop price, the VQ of the underlying stock, a percentage trailing stop of your choosing, or a set stop price. We’re going to look at the SSI Stop price. To do that, we just check the SSI box.


Then we press the “Calculate” button.

The analysis tells us that if we are willing to take $1500 of risk in FB, we can buy $10,610 of FB stock or 88 shares.


(Click on image to enlarge.)
Now, let’s go back and change the entry on the middle section. If we know how much we want to invest, the Position Size calculator will let us know how much risk we’re taking in that investment.

In this case, we want to invest $15,000 in FB. How much risk will we be taking?


Now, when we press the “Calculate” button, we can see that if we were to invest $15,000 into FB, we’ll be taking $3329 of risk.

(Click on image to enlarge.)
It’s that simple! We recommend that you take a few minutes to try this out and familiarize yourself with these new capabilities. The Position Size calculator can help you know exactly the right amount of money to invest in any new position, whether it’s a risky stock or a conservative stock.

Best wishes for a healthy, happy, and prosperous New Year with TradeStops.

Tom Meyer
Member Services

Lock in Higher Yields While You Still Can

While investors and the media focus on the stock market, the real action continues to take place in the bond market. The bond market warnings we wrote about in October and again in November did indeed crash onshore in the past couple of weeks.

While I’m obviously not surprised by the spike in long-term yields, I think that the corrections we’ve seen in the bond markets are overdone … and that this is likely a good time to consider locking in some of the higher yields we’re seeing today.

Before I get to why I believe that the bond market rout is overdone, let me remind you that what I write here on Fridays may or may not be in lock-step with current TradeStops signals.

TradeStops algorithms do a great job of covering 95% of our decision making needs and keeping us out of trouble, but once in a while, we see things that look likely to preempt our algorithms. A good example is our call this year on a rising US Dollar. We started calling for a stronger US dollar way back in May, long before a new SSI entry signal was eventually triggered on November 17th.

We think that we may now be seeing a similar situation developing with US Treasuries.

It’s a pretty daring call because the SSI chart on 10 year Treasuries looks absolutely terrible. The SSI is solidly in the red after having been stopped out over a month ago, and there is no sign of a bottom in sight.


So why on earth would I suggest this might be a good time to lock in some higher yields?

Just looking at the one-year chart above, it would be very easy to be negative about the downward direction of Treasuries (and upward pressure on yields), but let’s take a “bigger picture” view.

Back in 2013, the 10-year Treasury Note had a similarly steep drop from a higher level. We have now dropped back down to the highest level from 2013. There is strong support at the 120 level which is just a few points lower from where we closed yesterday.


And the commercial traders are as bullish as they’ve ever been. The most recent COT (Commitment of Traders) report shows that the traders have nearly their largest long position on record. Open interest on the futures contract is also near an all-time high. Higher open interest means that more capital is flowing into this market.


The red, oval highlights in the chart above show how in the past this level of bullishness has preceded higher moves in the Treasury markets.

The time-cycle forecasts have been doing a great job of forecasting T-Note prices. Right now, the time-cycles analysis very strongly suggests a bottom is near. We should start seeing higher prices by the beginning of 2017.


I’ve highlighted the long-term trend line in Treasury yields recently. The downtrend has definitely been broken, though we’ve seen this kind of brief breach of the downtrend a few times before. We will need to see something more decisive before we start quaking in our boots.


While the broken trend line is something to keep a close eye on, there’s another perspective on this trend that I haven’t shared before … the logarithmic trend.

When looking at very long-term trends, it’s useful to use a logarithmically scaled chart. On a log-scaled chart, equal vertical distances represent equal percentage changes. Bear with me for a minute while I briefly explain this concept.

If you look on the chart above, a move from 9% down to 8% is a 1% drop, but it’s also 11.1% of the distance from 9% down to 0% (i.e., 1% divided by 9%). Right?

On the other hand, a move down from 3% to 2% is also a 1% move, but it’s 33% of the distance from 3% to 0%.

Alright, if you’re eyes aren’t too glazed over from the math, now take a look at the log-scaled version of this same data below. You can see how the distance of 9% down to 6% is about the same vertical distance from 3% down to 2%. Both represent 33% falls.

OK … math lesson over. Now let’s talk about what this means.


When we look at the long-term trend of T-Note yields from this log-scale perspective, it shows something very interesting. It would take T-Note yields north of 4% to decisively break this long-term downtrend.

That’s a LONG way from where we stand today. Even Janet Yellen’s three planned hikes next year won’t add 1.5% to long-term yields.

We’re still largely in a zero interest rate world … and some of the safest investments on earth, US Treasury Notes, are now yielding 2.5%. How long do you think that is going to last?

Commercial interests (aka smart money) are buying … and the time-cycles are bottoming.

These conditions could be the Christmas present that income investors have been looking for.

Have a great weekend,

Richard Smith, PhD
CEO & Founder, TradeStops

We Have a Present for You – A New Feature!

Who said that presents are only for the kids during the holiday season? Our elves have been hard at work developing a new present especially for you to help with your investment strategies. What is this new present all nestled with care in the TradeStops program? It’s the Copy Position feature.

How Does It Work?
This new feature will let you copy any position (even a synchronized position) and move it to a different portfolio. The process is simple.

  1. Go to the Positions and Alerts tab within TradeStops.
  2. Click the little white box to the left of the position you want to copy.
  3. Click copy.


4. Select the portfolio where you want to move the portfolio.


(Note: You won’t be able to move a position to a synchronized portfolio.)

Why Should I Copy a Position?
There are numerous reasons to copy a position. We will discuss some examples here, but we are sure that you will come up with even more unique ways to use this new tool.

Let’s say that you want to organize your positions based on the SSI colors. This would be very easy to do. You would simply make three portfolios, one for each color. After doing that, you could copy your positions into this color-coded system.

You could also organize your positions by the VQ%. You could create four portfolios for low, medium, high, and sky-high risk. This would let you easily keep track of which of your positions carry more risk than others.


Different Purchase Lots? No problem!
How do you show the correct cost basis when you’ve made multiple purchases of the same stock and the sync feature won’t do it? Use the copy feature! With the “copy position” feature, you can duplicate the stock and show the respective cost basis with the entry price, entry date, and shares in a dedicated portfolio.

Use it for Research
Many of our customers employ our tagging feature. This is a quick way to organize your positions across different portfolios. The problem with this? You cannot organize your positions based on tags when you use our Risk Rebalancer.

This is where the copy position feature comes in.

Let’s say you have positions in gold and silver in two different portfolios, and you want to rebalance based on gold and silver separately.

The copy position feature will let you organize the gold and silver positions into two portfolios – one for gold and one for silver. From there, you could use the Rebalancer based on gold and silver, separately.


The Possibilities Are Endless
The “copy position” feature is super versatile. You will be able to use it any number of ways to improve your investment strategies and management. We hope that you enjoy this present from our elf team. Be on the lookout for new improvements. We always strive to improve our system for you. Happy holidays!


TradeStops Success Team

Groundbreaking Original Research

Part of the value of subscribing to TradeStops, or even just reading our editorials, is following our groundbreaking original research. We’re always looking for ways to help individual investors make more and risk less.

If I say so myself, this year we delivered in spades.

Today I’m going to briefly review some of the highlights of our research from the past year … and share with you a stock that passed all the screens.

The first theme we covered extensively this year is the power of buying a stock when it triggers a new SSI Entry signal and is in the SSI Green Zone.

In June, I showed you how to crush the S&P 500 by using only the SPY ETF. This article showed you that by following the SSI signals and only being long SPY when it was trading in the SSI Green Zone, you could have tripled the performance of the S&P 500.


In August, I took you into my research lab and showed you how you could make 37% per trade over a 20-year time frame using the SSI signals. This included almost 7500 trades in 1300 different tickers. The bottom line is that the SSI signals on winning trades outperform the losing trades by 5-1.


In October, we looked at how stocks that have given an SSI Entry signal could capture crazy gains before touching the SSI Yellow Zone. This research changed my own personal trading. I don’t wait for pullbacks as much for stocks that are in the SSI Green Zone.

Fiserv (FISV) was a good example of a stock that was in the Green Zone for almost two years before it touched the Yellow Zone.


And in November we asked, “When is too late to buy?” We found that even if you missed the SSI Entry signal, you could still buy the stock up to 2 VQs higher from the original SSI Entry signal.

Berkshire Hathaway Inc. (BRK.B) was a perfect example of this.


Finally, over the past few weeks we’ve looked at how expanding volatility (i.e., increasing VQ) can be the fuel a stock needs to kick-off a multi-year uptrend. I called this stock picking on steroids.

The S&P 500 was an excellent example of this going back 45 years.


So today I’m going to show you a stock that fits into all of these categories.

SSI Green Zone? Check. It triggered a new SSI Entry signal in the middle of April.


Sector moving higher? Check. This stock is part of the energy sector that has been in the Green Zone since the end of April.


Still within 2 VQ%? Check. The stock is trading at about $19, and the 2 VQ% level is at $23.


History of VQ% moving higher and the stock moving higher when the VQ% comes down? Check.

Here’s the chart of our mystery stock for the past 30 years. You can see that at almost all times when the VQ% peaked higher than the 30% level and then began to move lower, the stock had multi-year moves higher.


What’s the name of our mystery stock? Marathon Oil (MRO).

TradeStops isn’t in the business of giving securities advice … and this is not a stock pick. You have to decide for yourself what factors to consider before purchasing any new stock. However, it is an intriguing opportunity for your additional consideration that meets all the criteria of our 2016 research.

Consider it an early stocking stuffer.

Good investing,

Richard M. Smith, PhD
CEO & Founder, TradeStops