Our E-Wave cycle forecast models are signaling a top is imminent for several key markets and we suspect the financial sector is likely to get hit hardest. And this breakdown could come at any time according to our timing indicators.
One of the many things Larry Edelson taught us was to always look for confirmation from a variety of indicators, technical and/or fundamental, before placing a trade.
In addition to the E-Wave forecast, just take a look at the chart below, which shows the spread between short- and longer-term interest rates is quickly compressing …
A flattening yield curve is poison for the financial sector, because it means the spread that banks earn between money they borrow and loans they make is collapsing, crimping their profit margins in the process.
That’s why now is the right time to short financial stocks via the Direxion Daily Financial Bear 3X ETF, symbol FAZ, to profit from a steep fall in financial stocks. What’s more, this ETF is designed to hand you $3 in gains for every $1 drop in financial stocks; an excellent way to leverage your profit potential from the expected decline.
Plus, as you can see in the E-Wave cycle forecast chart below, we expect the euro to top out within a matter of days, and begin a substantial decline over the next two months.
Fundamentally, the catalyst could very well be this Sunday’s French election. But no matter the outcome of that contest, the euro is toast, it’s only a matter of time.
Now is the time to add to your short euro position in the ProShares UltraShort Euro, symbol EUO, as shown below.
Here’s what to do right away …
For ALL Members
1. Using 5% of the funds you have allocated to this service, buy Direxion Daily Financial Bear 3X ETF, symbol FAZ, at the market. Place a good-till-canceled protective sell stop at $16.95, and …
2. Using 5% of the funds you have allocated to this service, buy ProShares UltraShort Euro, symbol EUO, at the market. Place a good-till-canceled protective sell stop at $24.14 on all shares of EUO.
Go ahead and get these orders in to your broker right away and stay tuned for more updates!
Good Investing,
Mike and David
