VRA Update: Trend Reversal. 1098% Gains in 6 Months...in Just Two Stocks

By now you've probably already heard, more than $3 trillion in global stock market losses took place over the last two trading sessions. An all time record, for back-to-back trading sessions.

This morning, let's put these global losses in perspective...but not just from the last 2 days...let's instead take a look at declines from the past 13 months. In no particular order, here goes:

Germany: -25% from the highs

Italy: -37% from the highs

China: -24% from the highs

Japan: -27% from the highs

These are brutal declines. And the economic picture that they are painting is even worse...as in, if people aren't worried about a global depression, they must be smoking crack. This may sound like I am trying to be cute...I am not. This is as real as it gets, and those that are not preparing today will almost certainly regret it tomorrow. 

What about US markets? Most will be likely surprised to see these numbers:

S&P 500: -6%

Nasdaq: -12%

Russell 2000: -16%

Bottom line on US and Global Stock Markets: Equity markets had one last shot at rekindling a bull market. US indexes needed to break out to fresh highs on the current move. Instead, following the Brexit shocker, we are even further away...and the global kicker is that leading international markets are right back into confirmed bear market, crash mode. 

US traders will be watching the markets technical levels closely. After zooming lower through the 200 day moving averages on EVERY major index, and combined with the global devastation in stocks, going forward we can expect one primary trading strategy to be employed by the smart money: sell any major rally attempt...also, short any major rally attempt. 

The trading we have seen so far is nothing close to "capitulation"...and while it's too early to say that the markets will crash in the near future, I see major short term risks in US stock prices:

1) margin calls: unless stocks rally sharply...then manage to hold those gains...selling pressure from margin calls will act as a constant weight on the markets.

2) central bank anxiety: in every country where negative interest rates have been deployed, stock markets have been destroyed...led by absolutely massive and record losses in bank stocks. In the 90's, the term was "bond market vigilantes"...this group forced Bill Clinton into cutting government spending, eventually leading to a surplus. Now, I see "bank stock vigilantes" exercising their own brand of financial justice. Here in the US, the banking index is off a huge 25% from the highs. In Europe, the losses are 50-80%...just brutal devastation in the banking world. The vigilantes are shorting every rally in bank stocks...and there is little to nothing that the powers that be can do about it.

And yes...fear and panic are quickly setting in among central bankers and their commercial banking brethren. Negative interest rates have been the disaster that everyone with half a brain knew they would be. There's blood in the water now, and if I am correct, the selling pressure is nowhere near complete. Global markets are flashing "bearish engulfing patterns", technical speak for, "holy sh*t...will the selling pressure ever end?" 

BTW, did you happen to catch Alan Greenspan, on Bloomberg or CNBC, over the last 36 hours? I'll just repeat two of his comments:

1) "This is the worst economic/financial situation that I have seen in my professional career" (and no...he was not talking about Brexit/Europe...he was talking about conditions right here in the US).

2) "This ends in inflation". Of course Greenspan is right. And there's this; Greenspan is also a huge gold bug, recommending that we should go back on the gold standard. 

Folks, there's a reason gold and silver are up 23-25% since the start of the year. And there's a reason why here at the VRA, we are making absolute fortunes, with gains of close to 1100% in our top 2 mining stocks (combined), since the bull market kicked off in PM's on 1/20/16.

Remember, the precious metals/miner bull market is just now getting underway. Before it's over, gold will break $10,000/oz and silver will break $175/oz. But the real action will continue to be in the miners, as they appreciate 3-5 x faster than the metals themselves. 

The precious metals bull market of our lifetime is upon us. If you own the right companies, a wealth affect on steroids is underway. 

Until next time, thanks again for reading...

Kip 

VRA FLASH: BREXIT WINS! This Is What Happens Next

As it turns out, Mohammed Ali is not the only one that can shock the world. Our faith in the "possible" has been restored...maybe the little guy DOES have a shot, after all.

As I live tweeted the emerging victory for #Leave, with each city reporting their vote totals, it began to become more and more clear that Brexit actually had a chance. Gold started to spike...then the VIX started to spike...and the British pound began to plunge (to 30 year lows). 

Then, at 10PM Houston time, it became clear. With 60% of the vote in, it became a near impossibility that "remain" could win. By then, gold was up $40/oz, the VIX was up 31% and Dow futures were off 550 points...which is essentially where we find things this morning. 

Of my roughly 30 tweets during the vote, here are the two that seemed to resonate the most:

‏‪@KHerriage

Ironic.The US fought/gained independence from Great Britain, but it took Britain leaving the EU for the US to begin regaining our freedoms 

‏‪@KHerriage

I'm feeling one emotion right now. My faith...in the "system" ...is restored. We love our mates across the pond! Now we'll do our part.

We must keep in mind that it will still take 2 years for the UK to officially leave the EU. But, at the same time, the EU and global establishment must now see huge risks that other countries in the 27 member EU block will follow the UK's lead. Already, the odds are shifting to both France and Italy departing as well.

Greece may have been the first to vote on leaving...but now that the UK has pulled it off, one most important and striking fact is clear...the European Union is dead. Just typing these words gives me a chill. I just never thought it would actually happen...turns out my son was right...the little guy can still win.

Finally for now, know this; the markets detest uncertainty...and boy oh boy, is there plenty of that now. 

Also, and this is most important...I will be watching closely...the European close. Should their markets close at the lows, with heavy selling pressure right into the bell, US traders will get very, very nervous about Monday. As in, a potential black Monday. 

In 1987, as a 2 year broker, I witnessed Black Monday first hand. I watched veteran brokers make one mistake after another. The biggest lesson that I learned? We should look to "ACT" rather than "REACT".

I will continue to do this in every update and recommendation that I make, throughout what looks to be a rough week ahead for the markets. As long as we manage our emotions we can avoid the mistakes that most will make.

Honestly, I have no idea where the markets will be in 1, 2 or 5 days. But I know this...unless central banks bail out these markets, the risk level for stocks is extraordinarily high. This could well be Europe's Lehman Brothers moment.

The VRA now has more than 900% in gains, in just 3 mining stocks, since January 20^th of this year. I also had all of my Subscribers OUT of the stock market! Instead, we own the exact investments ramping 10-25% higher today.

If you would like to join us, we have a special BREXIT offer, through this coming Tuesday.

For the first time, we are able to offer the VRA as a 6-month subscription, and at just $595.

If you would like to act, simply reply back to this email with “I AM IN” in the subject line (or send to: kip@vraletter.com)

We will have your VRA Membership active ASAP. Come crush the markets with us.

Until next time, thanks again for reading...Stay Frosty

Kip

VRA Update: Brexit Polls..FED Insanity...and Terrorism...Are Changing Everything

Following my "Fix is In" VRA Update from last month, along with my consistent theme over the last...however many years...that "the establishment wins...big government wins", recent events might just be forcing me to change my stance.

Two major events may be in the process of changing everything.

The first is the upcoming vote on Brexit, which takes place in just 7 days. Should Britain vote to leave the 28 member European Union, then my theory of "big government wins" will be blown completely out of the water. As our oldest son, Tyler, said yesterday morning, "dad, if Brexit actually passes, it pretty much destroys your argument...maybe the people are actually capable of rising up." 

Son, do I ever hope you are right. The message sent to the rest of the world...to the rest of the worlds people...would be incredibly empowering. I believe it would be nothing short of revolutionary. 

How ironic would it be that Great Britain...the global superpower that our founding fathers and 13 colonies defeated...might then be the first to act, in taking back power from today's megalomaniacal global rulers, along with the corporations and military madmen they answer to?

But I remain skeptical...in fact, I remain very skeptical of Brexit actually passing. The powerful simply have too much to lose. And, while the recent polls all seem to favor Brexit, the bookies of England have been far more accurate in figuring odds over the years. Where do the bookies place the odds of a Brexit today? At 2-1..."against" Brexit.

The other major event that could be changing everything...this time, in the US? Terrorism, of course. 

The moment after I heard about the Orlando attack, my next thought was "Trump's chances of winning just went up, big time". Granted, if "foot in mouth disease" was real, Mr. Trump would be on a steady course of antibiotics. Still, when watching the left and their political correctness around the most important issue of modern times, that being "We Are At War...Right Here in the US..and Our Enemy Wants Each of Us Dead", HRC and BHO look as if they are living on another planet. Out of touch...beyond tone deaf...essentially, anti-American. I know no other way to state my thoughts, following their weak, weak, weak statements of yesterday.

Bottom line: Should Brexit win....should Trump win...our big government, establishment overlords will be running for cover. In fact, many will be rightly worried about convictions for treason (with 9/11 Truth at the very top of my personal agenda).

VRA Market Update

Overseas markets are weak once again, with every country in Europe down more than 1%. Things aren't much better in Asia. 

Remember all of my updates about the US market, and its inability to hit fresh highs of late? Each failed move higher is another shot to the midsection...yes, this market could very quickly get pounded once again. Think back to January...15% losses in less than 3-4 weeks...this is what could be directly in front of us.

The VRA System still has the market at overbought...but still, we remain above the most important technical levels. So...we will wait before taking action on the downside.

But gold and the miners? I continue to believe they are ready to break out...in a very major way.

Until next time, thanks again for reading...Stay Frosty

Kip

VRA Update: Your Questions; Sharp Reversal Lower - Specific Targets to Watch

Good Sunday everyone. I received two great questions this week...perfect for this VRA Update. Plus, I'm including specific index price targets for a sharp reversal lower (and yes, it's fast approaching).

Question One (Bill in TX): I enjoyed reading your "Professional Short Sellers" update for technical levels to watch for a reversal. Based on the close, haven't the transports reached both the 50% retrace levels along with being 90% overbought?

My answer: Great points Bill! Not sure how I missed mentioning this yesterday, but you are exactly correct. As of now, the transports have rallied a full 50% off of their high-low, and based on my proprietary VRA System reading, is now 93% overbought. Along with the Dow Jones, which has also retraced 50%, we are close to the point where top technical analysts look for a massive reversal...likely followed by fresh lows.

Key Index to Watch: Watch the transportation index ($DJT) folks. The transports led the way down, to begin this huge sell-off...and everything I've learned tells me that one of two things will happen: the transports will reverse lower "soon", or this may be more than just a dead cat bounce. You know my thoughts...we are going MUCH lower.

Question two (Sue in CA): Should we expect the federal reserve to continue further with QE and possibly even negative rates? From what you have said, they are all in, and I agree. Why should the insanity stop now?

My reply: You must be reading my mind Sue. In order to make money in these markets, we MUST have a high degree of respect for the unlimited power of the FED's printing press. I am always on alert for signs of the worlds central banks next move...and no, I do not believe the insanity has ended.

But here's the issue that I see, and that those I most respect, see as well. We are witnessing clear signs that the power of central bank moves has not only lessened, but likely, reversed into being clear negatives. As the world is moving to negative rates, the worlds equity markets have replied with fierce sell-offs. This is a point that cannot be forgotten. It might also mean that the next crash will come directly from central bank mistakes.

As I tweeted, the Bank of Japan now purchases up to 90% of all government bond sales. That's right...the country issues them, then the country buys them (through the BOJ). Just a decade ago this would be considered unimaginable...now its just "normal". In addition, and this is truly amazing as well, the BOJ now owns 54% of ALL Japanese equity ETF's. An no, I didn't stutter...they own and control 54% of all equities held in Japanese ETF's.

Does anyone see anyway this ends well? Central bankers...highly educated morons, leading us right into global financial systemic collapse. This is exactly what I expect historians to report.

VRA Market Update: 

Here's the bottom line on this bear market rally. As we approach these most important technical levels, soon we will all know what the next move will be; either a sharp move lower, or a continuation of the rally we have seen since last Thursdays lows.

Consider the following indexes...I spend a fair amount of time referring to these...now we will identify the specific points where short sellers will begin to get heavily aggressive, once again. As you'll see, we are quickly approaching many of these levels. 

Note: to keep this focused, I will not get into the "hows" of the technical analysis involved in selecting these levels...just know that they represent the 'median" price/trading points from the early December highs to the lows of last week. The levels I am pointing out are where the shorts will become HIGHLY aggressive on the short side...should we even reach these levels.

ONE: Russell 2000 ($RUT): I have targeted RUT because it first led stocks lower, and because of the size of the move lower I expected. For example, from just those early December market highs, the Russell 2k fell a huge 19%, versus the Dow Jones, which dropped by 11%.

Short Sellers are targeting a possible move to 1051 on RUT, versus the 1014 level today...meaning that RUT has potential upside of roughly 3.5%. Should the Russell 2k manage to achieve this kind of move higher, the level of short selling will be ferocious. 

TWO: Volatility ETF ($VIX): Short sellers are very close to aggressively targeting volatility again now. For example, their price target on this pullback is 20, and today's level of 20.50 means we are getting very close. I fully expect to see new cycle highs on the VIX, and we will use this to add to the 1000% + profits we've booked from using the VIX, alone, in just the last 3-4 years.

THREE: Energy co's, through XLE (energy stock ETF). From the most recent December highs, XLE plummeted 26%. Shorts are now targeting a potential move to $59 on XLE, before once again getting highly aggressive on the short side (last trade, $57). The next reversal will take oil to fresh cycle lows (just before the big turn that sends oil surging once again, as defaltion evolves into hyperinflation).

VRA Subscribers should save this update. As we test key levels, we will look to aggressively add new market short positions by keying off of these indicators (plus the other 50 indicators the VRA System employs). Remember, prior to the January sell-off, VRA Subscribers had a combined 1300% net short position (we love using leverge to our advantage...something that select VRA recommended leveraged ETF's help us to do). We timed the sell-off with near exact precision and we did so with huge, market short positions.

My goal is always simple, always clear; book massive profits for my valued Subscribers.  

Timing Mr. Market

We know the next phase lower is near because the market is telling us...

Sounds simpleton I know, but let me repeat; the market talks to us each day...all we have to do is listen.

Here's what it's telling me now: the bear market rally to date has been almost purely technical in nature...driven by short covering, low volumes and a continued addiction to the price action of oil. 

My work shows that neither oil or stock markets have bottomed...and that within short order, the dead cat bounce will be over. We will be very, very ready.

We may soon be adding to our market short positions...stay frosty!

Kip

VRALETTER.COM

VRA Update: Fresh VRA System Analysis: 1000% Profits for 2016

Good Wednesday all. It was an honor being Wayne's first guest on his new radio show last night. VRA Subscriber (Phil T) even jumped out with the first question for Wayne....plus a very nice plug for the VRA. Thanks Wayne and thanks Phil!

 I'll be joining Wayne frequently going forward and like last night, no target is off limits. The truth resonates...always has, always will.

I had asked for your testimonies and your replies were awesome. We'll record some new VRA spots soon and it's my goal to include your voice and details of your own investment success. But here's a testimony we received that everyone should be able to relate to:

"I joined the VRA in the late summer of 2015. I had minimal money to spend but decided to go ahead and join. I started trading with small amounts on VRA recommendations, just a few hundred dollars. After several months of LARGE profits I began to increase my amount in each investment. And recently I started investing between $2000 and $8000 in each recommendation. My accounts have literally doubled in six months and that is with very small investments to start with. What a blessing! As I write this, just today I am up an unbelievable amount. OVER $5300, just today. Need I say more…Les W."

Congrats Les! Let's keep it rolling...

VRA System Analysis Targets 1000% Profits for 2016  

They say the purpose of setting goals is akin to using a road map when planning a trip. How will you know you've arrived, unless you first know where you are going...

It's with this in mind that I ran the following VRA Analysis. As you'll see, the projections are for a (near) record year with the VRA. which would result in profits of more than 1000% for Subscribers by the end of 2016. After putting up 1300% in net gains in 2014, 730% last year, 1000% in 2016 is directly in my sights. 

Over the last 2-3 days I've charted each primary index (S&P, Dow, Nasdaq, Russell 2k, plus Intl), along with specific holdings of the VRA, and where they should eventually trade...all based on specific price targets that the VRA forecasts will come to pass.  

For example, because we know that the S&P 500 and Dow Jones lose (on average) 36% during the average recession, we can extrapolate from this that a further drop of 23% (minimum) would take place by the end of 2016 (S&P 500 has lost 13% to date). 

In this scenario, if we only used SPXU (3 x bearish ETF, S&P 500), we would make additional profits of 69% (23% profits, with 3 x leverage of SPXU). But it gets much better. Because I use the VRA System to "time" our investments in each market cycle, it's highly likely that we will trade SPXU several times this year...which has the potential to turn that 69% return into 200-300% + in gains for 2016.

I've repeated the same exercise with each of the investments we intend to use (leveraged ETF's for trading vehicles). The results would appear ridiculous for most...just not for the VRA.

2016: Turning $10,000 into $100,000 (or $100k into $1 million, etc)

If you've been here for any length of time at all, you know that the VRA Trading & Investing System has no equal. It's time to make sure you take full advantage of it. 

My goal this year is to once again produce profits in excess of 1000%. The VRA surpassed this level of profits in 2014 (1300%) and then topped 730% last year. Frankly, with precious metals breaking out, we may just blow this return completely out of the water.

The VRA Trading & Investing System...1000% return in 2016...this is my target. Care to join me??

Make it a good day everyone. Yellen's testimony will likely provide a lift to the markets today (as forecast yesterday). The only question is, how long might this bear market rally last?

I'll have the answer to this question a bit later. 

Kip

VRALETTER.COM