Overlay Model Portfolio
The Overlay Portfolio implements ideas and conclusion through derivatives. It consists essentially of a mid-term investment component that aims to participate in cyclical trends and a short-term trading component that focuses on pattern recognition. The overlay is portable to most institutional fixed-income or equity portfolios. Calculations are based on a 10% margin requirement.
A simplified and non-leveraged version, which includes its underlying components only, can be also subscribed by individuals under the Top Picks package.
Past results do not project future results.
Recent Analysis Examples
A few examples of our forecasts since we’ve made our work publicly accessible by launching this website are summarized below:
US Equities 1/2
We have been spot on to forecast the biggest reversals of Q1/2018 with tremendous precision. We got both, the bearish and the bullish, reversal right! Our bullish outlook on US equities changed on the 26th of January 2018. Almost nobody expected a market correction at that point. Our analysis was published within hours that the S&P500 saw a significant top, which led to a double-digit decline during the next couple of weeks.
On February 9th, 2018 we’ve called a sharp rally and made a case to buy the dip while other’s were screaming “October 1987!”. Moreover, we’ve stressed the importance to let the rebound develop and forecasted at least a spike into the 2,700-2,800 area. The market rallied within a few hours of our publication to the upside.
We have identified a major if not the Bitcoin top with surgical precision. We were bullish and forecasted higher highs until December 8th. 2017. That day we projected one last wave into a new top, which we forecasted to be at least a major if not the final top for the Bitcoin.
Our next update on December 17th 2017 called the top within a wedge formation in real time. We still do not know if this is the top or a significant top. However, a reaction to our call saved a drawdown or 70% of capital loss into February 2018!
The key takeaway here is that we were bullish and did not persistently call a reversal. This was our very first call of a significant top!
We were bullish throughout the 2017 EUR/USD cycle. On February 8th 2018, we forecasted one last swing into the 1.255-1.265 area before the cycle is complete and reverses. The EUR/USD went straight into our target 8 days later. A reversal occurred on February 16th. The subsequent sideways pattern into April 2018 was viewed by an overwhelming majority of technical analysts as a triangle that resolves to the upside. We forecasted the exact opposite – a resolution to the downside. Our forecast got confirmed and the EUR/USD quickly corrected down to the 1.15.
US Equities 2/2
We have forecasted the bull run in US equities during Q4/2017 precisely. Our call occurred in a market period of much bearish noise due to the month on October.Moreover, it coincided with geopolitical uncertainty about the nuclear threat from Northern Korea. The resulting market gain was more than 10% in the Nasdaq 100.
We were bullish since inception of our website on Indian equities and called at the beginning of October 2017 for the end of a correction pattern in the Sensex. We stayed bullish on the Indian stock market up until January 27th 2018 as we publish this. The market move accounted for more than a 15% gain.
We forecasted the biggest reversals of Q4/2017-Q1/2018 precisely. We got both, the bearish and the bullish, reversal right within days of their occurrence!
We turned bearish in early December 2017 after the USD/JPY failed a breakout attempt to the upside. We projected the currency to target at least into the 107.xx levels. The market dropped to the 104.5x area in March 2018.
Furthermore, we were able to recognize a significant reversal of the downtrend in March. We warned on this website as well as our Twitter account about an imminent change in the USDJPY trend. The tweet below was sent less than 20 pips before a sharp reversal kicked in. The currency pair went back to 110.
We identified an upside breakout for WTI oil in November 2017. The entire setup was complex and traded for 1.5 years sideways. Our forecast resulted in an attractive trading setup with a very tight stop/loss and attractive upside potential.
We’ve made a bullish forecast for the Bovespa in early December 2017. It was based on pattern recognition of a 4th elliott wave triangle. Our forecast was a swift breakout to the upside. After a 10% gain we took on a neutral stance as global equities got into riskier territory.