We’ve received many comments and questions over the past few days regarding the recent US market crisis asking what to expect next. Is this the start of something bigger? Deeper? What should I do with my open long positions? What should I do to prepare for anything in the future? All of these are valid questions. So, we wanted to help our members and all of our followers by showing what we believe will be the most likely price action going forward a few weeks out.

The recent downside moves in the US majors did freak a lot of people out. It was something that startled people and pushed a panic button for many.  Certainly, the rotation in the VIX and volatility related ETN’s pushed many people over the edge. In fact, recent news is that these volatility related ETN’s exasperated the selloff as the VIX shorts were pushed out of positions and into a protectionist mode with the massive spike in volatility. As the old floor trader saying goes “want to know what causes the markets to crash? Buyers that turn into sellers to protect from unwanted losses”.

In fact, the fear and selling were so strong it sent the safe havens tumbling lower, which we took advantage of trading the DUST gold miners ETF for a quick 20% profit.

Well, now that this rotation appears to be almost over either this week or early next week, let’s take a look at some of the technical channels and fundamentals that should drive the markets going forward.

First, we have strong economic and fundamental US and global data that is showing increases in the global economy, GDP, output, employment and more. In reality, the global markets are pushing hard for greater growth. The one factor that is still concerning for us is the US Fed and Interest Rates as well as regional housing levels. We have been watching these levels quite closely over the past few months and watching what is happening in major metros across the US and globally. We are still seeing price appreciation and strong activity in most locations which indicates the top has not formed yet.