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1 Weekly Market Update 5-19-17 © 2017 · Phoenix Capital Research, Phoenix Capital Management Inc. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Phoenix Capital Management Inc. · All Rights Reserved.

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Page 1: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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Weekly Market Update 5-19-17

©2017·PhoenixCapitalResearch,PhoenixCapitalManagementInc.AllRightsReserved.Protectedbycopyright laws of the United States and international treaties. This newsletter may only be usedpursuanttothesubscriptionagreementandanyreproduction,copying,orredistribution(electronicorotherwise, including on theworld wideweb), inwhole or in part, is strictly prohibited without theexpresswrittenpermissionofPhoenixCapitalManagementInc.·AllRightsReserved.

Page 2: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

Disclaimer: The informationcontainedon thisnewsletter is formarketingpurposesonly. Nothing contained in thisnewsletter isintendedtobe,norshallitbeconstruedas,investmentadvicebyPhoenixCapitalResearchoranyofitsaffiliates,norisittoberelieduponinmakinganyinvestmentorotherdecision.Neithertheinformationnoranyopinionexpressedonthisnewsletterconstitutesandoffertobuyorsellanysecurityorinstrumentorparticipateinanyparticulartradingstrategy.Theinformationinthenewsletterisnotacompletedescriptionofthesecurities,marketsordevelopmentsdiscussed.Informationandopinionsregardingindividualsecuritiesdonotmeanthatasecurityisrecommendedorsuitableforaparticularinvestor.Priortomakinganyinvestmentdecision,youareadvisedtoconsultwithyourbroker,investmentadvisororotherappropriatetaxorfinancialprofessionaltodeterminethesuitabilityofanyinvestment.OpinionsandestimatesexpressedonthisnewsletterconstitutePhoenixCapitalResearch'sjudgmentasofthedateappearingontheopinionorestimateandaresubjecttochangewithoutnotice.Thisinformationmaynotreflecteventsoccurringafterthedateortimeofpublication.PhoenixCapitalResearchisnotobligatedtocontinuetoofferinformationoropinionsregardinganysecurity,instrumentorservice.Informationhasbeenobtainedfromsourcesconsideredreliable,butitsaccuracyandcompletenessarenotguaranteed.PhoenixCapitalResearchanditsofficers,directors,employees,agentsand/oraffiliatesmayhaveexecuted, or may in the future execute, transactions in any of the securities or derivatives of any securities discussed on thisnewsletter. Past performance is not necessarily a guide to future performance and is no guarantee of future results. SecuritiesproductsarenotFDICinsured,arenotguaranteedbyanybankandinvolveinvestmentrisk,includingpossiblelossofentirevalue.Phoenix Capital Research, OmniSans Publishing LLC and Graham Summers shall not be responsible or have any liability forinvestment decisions based upon, or the results obtained from, the information provided. Phoenix Capital Research is notresponsibleforthecontentofothernewsletterstowhichthisonemaybelinkedandreservestherighttoremovesuchlinks.OmniSansPublishingLLCandthePhoenixCapitalResearchLogoareregisteredtrademarksofPhoenixCapitalResearch.OmniSansPublishingLLC-POBOX2912,Alexandria,VA22301

Page 3: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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AsIexpected,themarketisnowturninginabigway.Whenmarketspeakandbegintobreakdown,theyneversimplycollapse.Insteadtheyfirstbreakthroughsupportandthenstageabounce.Thereasonforthisisduetoinvestorpsychology:thebullsdon’tinitiallythrowinthetowel,butinstead“buythedip.”Itiswhenthebouncefailstobreaktonewhighsthatyouhaveconfirmationthatthetopisin.Sothepatternis:

1) Abreakdownbelowsupport2) Abouncebacktoretestformersupport3) TheREALcollapse.

Themarketsarenowonstage#2.And#3isjustaroundthecorner.

Thisisparticularlytruewhenyouconsiderthereasonthatstocksbouncedsohard.OnFriday(today)duringaQ&Asession,StLouisFedPresidentJamesBullardstatedthatthe

Weekly Market Update 5-19-17

Page 4: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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FedshouldretainQEasapolicyoptioninthefutureifitisneeded.Stockseruptedonthenews.

HowBullard’scommentsareoriginalornewsworthyisbeyondme.TheFedneveroncedisavowedQEasapolicytool.SohiscommentthattheFedshouldcontinuetoseeQEasanoptionisnoteveninsightful.Thisiswhattellsusthatthebouncewaslargelystockbullslookingforanyexcusetorampstockshigher.Italsotellsusthatthemomentumisindeedbrokenforthemarkets.IexpectstockstofallHARDnextweek.Thisbouncewillbethefinalgasptomaintaintherally.Thenextdownsidetargetis2,300attheredcircle.

Page 5: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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ThesingleworstperformersduringthedeclinewillbeFANGstocks.Apple(AAPL)isgoingto130.

Page 6: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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Amazon(AMZN)willbemovingto$850.

Alphabet(GOOLG)willalsobefallingto$850.

Page 7: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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AndNetflix(NFLX)willbegoingto$130.

Thismovewillcoincidewiththe$USDbouncing.Thegreenbackiscurrentlysharplyoversold.

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Thisbounceinthe$USDwillhurtpreciousmetals.Ifullyexpectourpreciousmetalsportfoliototakeahitnextweek.However,thiswillbethefinaldropbeforeaMAJORbottomisformed.Goldwillcorrectto$1220orsobeforebeginningitsnextMAJORlegupto$1,350+byAugust.

Silverwillrevisit$16.00beforemakingitsmoveto$18.50/$19.00byAugust.

Page 9: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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Ialsothinkwe’llseethis$USDstrengthhurtingOil.USOwilldropto$21.00orso.AtthatpointtheMAJORleghigherforOilandOilstockswillhit.

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Elsewhereinthemarkets,Europeanstocksarereadytodrophard.ThereliefrallybasedontheFrenchelectionresultsismisguided.FranceandEuropeingeneralareinveryserioustroublefromaneconomicandfinancialperspective.TheFranceETF(EWQ)willbedroppingto$24andchangeinthenextsixweeks.

Spain’sETF(EWP)willbegoingto$26andchange.

Page 11: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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We’vecoveredalotofgroundhere.I’dliketotakeamomenttoreviewjustwhereweareandwherewearegoingfromaBigPicture.BigPicture:Forthefinancialmarkets,thefirsthalfof2017wasdominatedbytwokeythemes,bothpoliticalinnature:

1) Themarket’sperceptionoftheTrumpeconomicagenda2) Themarket’sconcernsregardingtheFrenchPresidentialelection

Bothofthesethemesweregenerally“riskon”forthemarketswithstockspushinghigher.However,botharemistaken.TheTrumpeconomicagendaasI’venotedtimeandagainwillbeunfoldingmuchmoreslowlythanmostrealize.ThefactisthatthereisTREMENDOUSpressuretostopTrumpaccomplishinganythingcomingfrombothsidesoftheaisles.TheestablishmentRepublicansandtheDemocratsallwantTrumptoaccomplishaslittleaspossible.TheirhopeisthatifTrumpaccomplishesnexttonothing,hiswinwillbeseenasa

Page 12: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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flukeandthingscanreturntowhattheyconsider“normal”from2018onward.Forthisreason,IexpectTrumptofindanymovementintheso-called“swamp”tobeslowgoing.Themarkethascompletelymispricedthis.Thesecondtheme,(theFrenchPresidentialelection)willprovetobealsobemisinterpretedbythemarket.Theso-called“relief”rallythatstemmedfromMacronwinningthePresidentialelectionisnotgoingtolast.ThefactisthatMacronhasnotraditionalpartysupportinghiminFrance.HefacesTREMENDOUSheadwindsinformingafunctioningGovernment.Moreover,it’snotasiftheEU’sissuewithdebts,immigration,andthelikearesomehow“fixed”becausehewon.Thatwasthefirsthalfof2017.Thesecondhalfwillinvolvethemarketrealizingalloftheaboveaswellasthefactthattheglobaleconomyisweakening.ThiswillresultinadditionalCentralBankeasing,andhigherinflationwiththe$USDplunging,EmergingMarketssoaringandpreciousmetalsmovingtonewhighs.Thetransitionfromthefirsttothesecondhasnowbegun.Iexpectitwilltake2-3weeksforthistransitiontocomplete,butIbelievethatinJune:

1) Oilwillbottomandbeginitsmoveto$65byyear-end.

2) Preciousmetalswillbottomandbreaktonewhighsbyyear-end.

3) Emergingmarketswillbottomandbeginbreakingtonewhighsbyyear-end.

4) USstockswillhaveofficiallytopped(thismayhavealreadyhappened)andbeginbreakingdown.Byyear-endtheymightbebreak-evenbutonlyaftergrindinglowerforseveralmonths.TheNASDAQwillbetheworstperformingindexofthebunch

Thatisthebigpicturegameplan.Theonlyquestionistiming.Thiscouldtakeseveralweeks,oritcouldhappenallatonce.Specifically,andIwanttobeblunthere…it’squitepossiblethatthestockmarketwillcrash.AndImeanCRASHasindrop15%inamatterofdays.Rightnow,Iputtheoddsofthisat20%.ButthatisMUCHhigherthanusual.

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Thereasonforallofthisisthatrigsandmanipulationhaveproppedupthemarket.StockshavebeenFAKEforseveralmonthsnow.Anytimethemarketgetsthisfakeyoucanhaveacrash.Here’swhatI’mtalkingabout:stocksareEXTREMELYoverboughtfromtheirlong-termtrendlinecourtesyoftheTrumpelectionwinrally.Giventhatthisrallywasbasedonthemarket’smisconceptions,itisnotunrealisticforstockstoCrashbacktoreality(around2,050-2,100ontheS&P500).

I’mwatchingthemarketscloselyforsignsthismightprovetobethecase.Butfornow,mybasecaseiswhatIalreadyoutlined:amajorturnishappeningnowanditwilltake2-3weekstounfoldbeforethedominanttrendsfortheremainderof2017hitinthesecondhalfoftheyear.TherewillbeopportunitiestoseeHUGEreturnshere.Butwewillneedtobepatientandwaittobuyattherighttime.Rightthismoment,whilethemarketistransitioning,thebestthingtodoiswatchandwait.Thisconcludesthisweek’sweeklymarketupdate.I’mwatchingthemarketscloselyandwillissueupdatesasneeded.Barringanynewdevelopmentsyou’llnexthearfrommenextWednesdayinourusualweeklymarketupdate.Untilthen…

Page 14: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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GrahamSummersChiefMarketStrategistPhoenixCapitalResearch

BestRegards,

Page 15: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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OPEN POSITIONS

STOCKS PORTFOLIO

BONDS PORTFOLIO

POSITION SYMBOL BUY DATE

BUY PRICE

CURRENT

PRICE

GAIN/ LOSS

NuveenMuni.Fund NVG 1/2/14 $13.12 $14.91 37% EmergingMarketBonds EMB 11/21/16

$109.82$114.92 7%

LongUSTreasuries TLT 11/21/16 $121.05 $123.71 3% Pricesasofmarket’scloseon5/19/17.Gainsincludedividends

POSITION SYMBOL BUY DATE

BUY PRICE

CURRENT PRICE

GAIN/ LOSS

RPXCorp RPXC 8/5/15 $15.48 $13.94 -10% AgriculturalCommoditiesETF RJA 1/12/17 $6.46 $6.30

-2%

ChinaETF ASHR 2/1/17 $24.98 $24.68 -1%

PublicStorage PSA 3/23/17 $225.92 $214.48 -5% SouthwesternEnergy SWN 3/30/17 $8.15 $7.11 -13%

GulfportEnergy GPOR 3/30/17 $17.17 $16.11 -6%

ClearEnergyETF PBW 4/19/17 $4.06 $4.06 0%

USOilFund USO 4/26/17 $10.37 $10.48 1%

BiotechETF IBB 4/26/17 $296.15 $290.45 -2%

Verizon VZ 4/26/17 $47.17 $45.42 -4%

ExxonMobil XOM 5/3/17 $82.70 $81.93 -1%

Page 16: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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POSITION SYMBOL BUY DATE

BUY PRICE

CURRENT

PRICE

GAIN/ LOSS

Gold 3/17/10 $1,120 $1,254.00 12% Silver* 3/17/10 $16.23 $16.84 4%

GoldMinersETF** GDX 10/5/16 $22.45 $22.86 2% GoldMiningJuniorsETF*** GDXJ 10/5/16 $34.72 $32.61

-2%

WheatonPreciousMetalsCorp WPM 10/5/16 $22.59 $21.00

-7%

NewGold NGD 10/5/16 $3.88 $2.95 -24%

BarrickGold ABX 4/26/17 $16.92 $16.65 -2%

SilverMiningETF SIL 4/26/17 $34.44 $36.27 5%

SilverStandard SSRI 4/26/17 $9.94 $10.11 2%

FirstMajesticSilver AG 5/12/17 $8.70 $8.92 3% RandgoldResources GOLD 5/12/17 $93.25 $95.06 2%

PRECIOUS METALS/ MINERS PORTFOLIO

Pricesasofmarket’scloseon5/19/17.Gainsincludedividends*Averagepriceof$17.50and$14.97**Averagepriceof$22.83and$22.07***Averagepriceof$37.52and$31.92

SPECIAL SITUATIONS/HEDGES/SHORTS PORTFOLIO

POSITION SYMBOL BUY DATE

BUY PRICE

CURRENT PRICE

GAIN/ LOSS

FranceETF(SHORT) EWQ 9/16/16 $23.38 $29.36 -26% ItalyETF(SHORT) EWI 9/16/16 $21.56 $28.52 -32% Russell2000ETF(SHORT) IWM 12/14/16 $135.37 $136.03 0% Apple(SHORT) AAPL 3/23/17 $140.92 $152.96 -9%

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CASH/ CURRENCIES PORTFOLIO

POSITION SYMBOL BUYDATE

BUYPRICE

CURRENTPRICE

GAIN/ LOSS

EuroTrust FXE 10/5/16 $108.80 $108.54 0%

Pricesasofmarket’scloseon5/19/17.Gainsincludedividends

Page 18: Weekly Market Update 5-19-17phoenixcapitalmarketing.com/PWA5-19-17.pdf · 2017. 5. 19. · Bonds EMB 11/21/16 $109.82 $114.92 7% Long US Treasuries TLT 11/21/16 $121.05 $123.71 3%

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POSITION SYMBOL BUYDATE

BUYPRICE

SELLDATE

SELLPRICE

GAIN/ LOSS

AmericanEagleOutfitters(SHORT) AEO 5/26/16 $15.36 1/31/17 $14.59 5%CliffsNatResources(FIRSTHALF) CLF 2/8/17 $10.15 2/13/17 $12.10 19%

Ambev ABEV 11/25/16 $4.96 2/23/17 $5.93 21%Cemex CX 11/25/16 $8.07 2/23/17 $8.69 8%CliffsNatResources(SECONDHALF) CLF 2/8/17 $10.15 2/23/17 $11.13 10%

Exxon XOM 9/24/14 $95.82 3/8/17 $81.28 -8% EnterpriseProductsPartners EPD 11/31/16 $25.93 3/8/17 $27.83

9%

NaturalGasETF UNG 2/22/17 $6.57 3/8/17 $7.11 8%

EmergingmarketsETF EEM 1/12/17 $36.60 4/10/17 $39.20 7%

BarrickGold ABX 10/5/16 $15.54 4/10/17 $19.04 23%

UraniumETF URA 6/8/16 $15.49 4/12/17 $15.90 9% Cameco CCJ 1/4/17 $10.69 4/12/17 $11.48 7% CoalETF KOL 1/4/17 $12.59 4/12/17 $14.51 15% SilverStandardResources SSRI 10/5/16 $10.30 4/12/17 $11.32

10%

RoyalGold RGLD 2/8/17 $71.50 4/12/17 $74.14 4%

SilverMiners SIL 3/15/17 $35.81 4/12/17 $37.60 5%

USSteel(SHORT) X 2/1/17 $31.97 4/13/17 $29.42 8% CopperMinersETF(SHORT) COPX 3/23/17 $22.64 4/18/17 $21.02 7%

FinancialsETF(SHORT) XLF 12/21/16 $23.61 4/26/17 $24.06 -2%

RECENTLY CLOSED POSITIONS

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RECENTLY CLOSED POSITIONS CONTINUED

POSITION SYMBOL BUYDATE

BUYPRICE

SELLDATE

SELLPRICE

GAIN/ LOSS

PeruETF EPU 12/7/16 $33.23 5/17/17 $34.775%

BrazilETF EWZ 2/8/17 $37.53 5/17/17 $39.90 6%UtilitiesETF XLU 2/8/17 $49.35 5/17/17 $51.58 5%SolarEnergyETF TAN 4/19/17 $17.20 5/17/17 $18.00 5%RoyalGold RGLD 4/26/17 $69.92 5/17/17 $79.90 14%