 Hey everyone, this is Dan with another episode of my crash protection videos. Since the beginning of the year, S&P 500 is down 16%, NASDAQ 100 is down 25%. Last Thursday, May 12th, the market hit an interim bottom with S&P being down almost 20% from the beginning of the year. Since then the market has rebounded a little bit, will the stock market continue to recover? Where should we invest our money if the market continues to go down in the next few weeks? I have found several ways to swim against the current, in other words to make profits in spite of the sinking market. Let's get into the details. First, let's see how SPY and QQQ are trending. As you might know, SPY represents the movement of S&P 500 and QQQ represents the movement of NASDAQ 100, as you can see in the chart. Since the beginning of the year, SPY is down 16% and QQQ is down more than 25%. Definitely this is a very bearish picture. In the last few days, SPY has gotten below a very important support level, same with QQQ. The good news is that since the market hit the bottom here, last Thursday, it has recovered a little bit. The big question mark is whether the market will continue to recover and if the market does not recover and starts to come down again, where should we invest our money, that way we can still make profits in spite of the dropping market. Actually, there are several ways I found to make profits in the sinking market. We will talk about that in the next few minutes. In the last few years, we have been conditioned into thinking that the fang stocks are the best performing stocks in the market. Let's see how they have been doing since the beginning of this year. As you can see from this chart, they are actually doing pretty badly. For example, in this chart, again SPY is a candlestick chart, which is actually the best performing instrument in this chart. And below that is Apple, that also went down by about 16%. Alphabet or Google went down by about 20%, same with Microsoft. QQQ down 25%. Amazon down almost 35%. Facebook down 40%. Netflix has been down a whopping 68%. Definitely, our conventional thinking does not work anymore and if you still have a lot of your money in the fang stocks, you are not a happy person at this point. I still actually own some Google shares, but I sold most of my fang stocks shares as well as some of the semiconductor shares so that I could free up money to purchase all the assets that actually helped me make a profit in the last few months. And I'll talk about that in the next few minutes, which is related to this chart. If you look at this chart is the almost flipped mirror image of the other one. The previous chart had the lines all below the SPY line and this chart pretty much has the lines above the SPY line. As you can see, SPY is here on the bottom, losing 16% since the beginning of the year and a little bit below that QQQ losing 25%. And then we have this line, which represents the ETF UNG, that's a natural gas ETF up 109% since the beginning of the year. Isn't that wonderful? If you have bought UNG in the beginning of January, then you will have double your investment by now. And then next to that, you see all of the oil ETF up 101% TMV and ETF related to the 20 year Treasury rate up 71%. Now, these two are not spectacular at this point, but they have the potential of doing it up quickly. And I'll explain that later. COPX, the copper minor ETF, it's actually down a little bit by about 2%, same with CPER copper ETF down 2% so far since the beginning of the year, but they will be shooting up quickly based on my estimate. I'll explain that in the next few minutes. If you like what you've seen so far, I'd like to encourage you to click the like, subscribe and notification button that will enable you to receive notification when I post my next video. And it will encourage me to make more videos like this in the future. Thank you very much. Let's continue. We have a lot of interesting things to cover. Let's talk about a few major events that happened in the last few days. On May 4th, the Federal Reserve banks raised interest rate by half a percentage point. And that's the biggest rate hike in two decades. The Fed is doing that because they want to fight inflation. In addition, they want to reduce the total asset by up to $95 billion a month, starting a few months from now. And I'll talk more about that later. What the Fed is doing is basically tightening the money supply. And that will definitely have an adverse impact to the stock market. Basically, the Fed wants to cool down the economy. They want to cool down the stock market. If you look at the CPI inflation rate is being shooting up quickly since January of 2021. And as of March, the CPI was at 8.5%. April, it's actually a little bit lower, but still pretty high at 8.3%. And then we'll learn about the May CPI on June 10th. Hopefully, the May CPI is not as high as 8.3 or 8.5. If May CPI is much higher than 8.3 or 8.5, then the Fed will probably even tighten more. That'll bring more pain to the stock market. Why are the Fed actions so important? This chart tells it all. This is the total asset held by the Federal Reserve banks. And every time when the Fed increases assets, it's actually creating money or liquidity in the market. Starting from the pandemic beginning of 2020, the Fed total asset increased from about $4 trillion to $9 trillion now, a little bit more than double. And coincidentally, the S&P 500 also about double during this time. Of course, there's more money chasing the same amount of stocks. And that's why when the money supply double, the value of the stocks in the market also about double. Now, what's going to happen is that instead of increasing the asset every month like here to the tune of $120 billion a month, it has flattened out up until this point. And pretty soon it's going to start coming down at the rate of up to $95 billion a month within the next few months. And that's going to have a profound impact to the stock market. In the meanwhile, because of the Omicron COVID variant, Shanghai has been locked down in the last few weeks, as well as a few other major cities in China. And that has slowed down the supply chain and caused the prices of any manufacturing products to increase. The good news is that the deputy mayor of Shanghai has been saying that they will gradually start to relax the lockdown procedures in Shanghai. And they hope to be able to open everything between June 1 to mid and late June. Let's hope that happens to Shanghai and the other major cities in China that have been locked down. Oh, there's an article that came out today. It says the Fed has a new plan to avoid recession. In other words, the chairman of the Federal Reserve Bank, Mr. Jerome Powell, wants to aim for a, quote, soft landing, unquote. And he referred to the soft landing in 1994 when Alan Greenspan was a Fed chair. Apparently at that time, the Fed was able to control inflation by cooling down the market and without bringing a market crash. Jerome Powell is very hopeful that he could do the same thing. Let's hope for the best. But if we end up with a much harsher landing than a soft landing, I believe I have the strategy to avoid losing a lot of money in my portfolio. I'll be talking about that in the next few minutes. How do we swim against the current? In other words, how do we make profits in spite of the fact that the stock market might be sinking? There's one instrument called the TMV, which is the ETF pack to the 20 year treasury rate. And that has been going up nicely, as you have seen in the chart that I've shown. And also the other two lines in the chart are UCO and USO. They are crude oil ETFs, but they are related to the Ukraine war. The reason why the oil prices have been so high is because the fear of the oil supply by Russia being reduced or cut off because of boycott from the United States and from the European nations. Actually at this point, the Russian oil daily production volume has not been substantially reduced yet. But the price increase in oil is primarily due to the fear of a future shortage. And actually the EU has been talking about implementing a plan to progressively decrease the reliance on Russian oil during the course of the next six months to a year. When that starts getting implemented, I believe the oil prices as well as the prices for ETFs such as UCO and USO will continue to go up. And that's why I've been buying UCO myself. UNG, similar to the situation with oil, Russia provided a lot of natural gas to Western Europe and that's why the price for natural gas has been going up as well and because of it the UNG ETF has been going up. Weed, because Ukraine is a major wheat producing nation, they supply wheat to the rest of the European nations and that's why the wheat price has been going up. Now again, as soon as there's a peace of settlement in Ukraine, these instruments will go down quickly and that's why we need to be agile when we invest in these ETFs. And then I also have been swing trading SQQQ or SPXS. They are the three times inverse ETFs, pegged to the NASDAQ 100 or S&P 500. And then in anticipation of the reopening of Shanghai and other major cities in China, I believe CPER and COPX, the ETFs related to copper will be going up. And just today I bought some COPX shares. When would market recover? There are several things that could lead to a significant recovery of the market. First of all, if we see positive Q1 earnings and bullish Q2 projections actually pretty much all the major earnings have been announced and the projections have been very cautious. That's why this first pull-up point actually hasn't done much for the market. Now we can hope for the second pull-up point, which will be the end of the Russian-Ukraine war. And of course, if the Ukraine war comes to an end, that will help restore stability in the stock market to some extent. But in the meanwhile, it will bring down the prices of ETFs that we just talked about, the oil-related ETFs, natural gas-related ETFs, and wheat and grain-related ETFs. So we've got to be careful in that regard. And if the COVID lockdown is ended in China, which hopefully will happen by the end of June, and if inflation can drop to 3% to 4% range causing the Fed to stop raising interest rate, and of course when the Fed stops reducing its assets, that will help stabilize the market. Now the last pull-up point is an unhappy way to bring about the recovery of the stock market. That is when the unemployment rate gets to be so high, for example, higher than 6%, which will cause the Fed to ease its monetary policies, including increasing Fed assets, and also reducing interest rate. But that will come about because of pain that already happened in the economy. Let's hope we don't see that happening anytime soon. Let's hope the pull-up points above this line come to fruition and help restore stability in the stock market. What are my strategies? I've been selling shares of stocks such as the FANG stock and semiconductor stocks when the prices fall below certain critical support levels that I've been sharing some of my trades with my Twitter subscribers on a daily basis, and I've been buying stocks and ETFs that tend to go up with interest rates. For example, I've been buying and selling TMV and have made Silicon Profits with it, and I've been buying stocks and ETFs that tend to go up with energy and wheat prices, including UCO, UNG, XLE, which is the energy-related ETF, COP, conical Phillips, wheat. I have not bought wheat yet, but I will soon be buying that when RSI value gets to a reasonable range. And I've been keeping stocks with strong fundamentals even though I've sold some shares to raise cash for the other instruments that I bought recently, but I'm still keeping shares of applied materials, ASML, advanced micro-devices, brochure Hathaway B, Alphabet, O'Reilly, Automotive, Qualcomm, Taiwan Semiconductors, and I've been swing trading recovery stocks or stocks with long-term potential such as LUV, Southwest Airlines, Royal Caribbean, Tesla, this is the Copper Minors ETF and Copper ETF, and I've been swing trading triple ETF such as TQQQ and SQQQ. At this point I'd like to suggest for you to also subscribe to my Twitter account. I've been sharing some of my trades and also major news developments with my Twitter subscribers almost on a daily basis. For example, on April 29th I tweeted that I sold SQQQ shares I bought the day prior and realized 8.3% gain. That's pretty amazing, 8.3% gain just in one day. And then on May 12th I tweeted that I sold half of my UNG shares at about 8% gain and that's one of the ETFs that I show on the chart earlier that actually went up when the market went down. That's the natural gas ETF. And then just today I bought more UNG shares because it's rebounding from the middle of the Bollinger Band 20-day simple moving average line. And then also today I bought the COPX, the Copper ETF because the COVID lockdown in Shanghai and in other cities in China will end soon. Again if you like what you've seen I'd like to suggest that you click the like, subscribe and notification button and do subscribe to my Twitter account. You can text me your questions on a daily basis and I've been doing my best to answer my subscribers and actually we have been having some very interesting discussions. As usual I will very much welcome your comments, questions and suggestions. I'd like to remind you that I'm not a financial advisor. I share my stock trading strategies and analyses for educational and entertainment purposes only. If you want to buy or sell stocks you should make your own decisions and you should definitely check with your financial advisors before you do so. This wraps up my video for now. I will chat with you again in the next few days. In the meanwhile I'd like to wish you the very best of luck with your financial investments.