What We Built for the Coming “Year of the Bear” VIEW IN BROWSER By Michael Salvatore, Editor, TradeSmith Daily In This Digest: - The ominous tsunami signs most folks tragically missed
- Legendary investor Marc Chaikin says 2026 will be the Year of the Bear
- Why he’s partnering with TradeSmith to help keep you safe
- A new type of indicator for a new type of market
- Sign up here for our launch event next Tuesday at 10 am ET
It was the day after Christmas, 2004… Ten-year-old British schoolgirl Tilly Smith stood on Mai Khao Beach, on the northern edge of the island of Phuket in Thailand. Looking out to the horizon alongside her parents, she noticed something strange. As she put it, the tide was frothing “like the kind you get on a beer.” Then the tide withdrew far quicker than normal. The wind shifted. And an unsettling sucking noise rose from the shoreline. What Tilly knew, but the 100 other people on that beach didn’t, was that these were textbook warning signs of a tsunami. And because of a school lesson weeks before, she saved every one of those people that day. The next minutes were crucial. She pleaded with her parents, warning them that a devastating series of powerful waves would soon destroy the beach they stood on… and everyone on it. After initial resistance, she convinced her family to alert hotel personnel, who sounded the alarm and urged the other beachgoers to evacuate to higher ground. Minutes later, the first waves of the tsunami struck and devastated much of the western coastline of Thailand. More than 8,000 people perished in that day’s disaster, along with hundreds of thousands more in neighboring countries. Many of them didn’t recognize the signs that allowed Tilly to save her family. There are numerous stories of people rushing out into the shallows to get a once-in-a-lifetime photo, only for it to be the last photo they ever took. | Recommended Link | | | | Elon just dropped $1B into Tesla shares. But the real money could be in his potential Jan 26 AI launch – and it’s not Tesla. Click here to see the backdoor. |  | | Investors rarely get a signal as vivid as a receding tide… Market crashes happen quickly and usually without warning. And they’re getting faster all the time. - Just think about the post-Liberation Day plunge in April, which took the tech-heavy Nasdaq 100 down about 12% in two days.
- Or think about the COVID-induced crash in early 2020. It was the fastest bear market of all time. In March 2020, the S&P 500 lost 29% in just 16 trading sessions, the quickest descent into a bear market ever recorded.
- Or consider the last trade war, in 2018, when the S&P 500 crashed by more than 20% in just a few months.
But even ahead of these rapid crashes, there are warning signs to follow… if you know where to look. And one of the few people with a record of accurately predicting these moves is Wall Street legend Marc Chaikin. 
Marc on Wall Street As the founder of Chaikin Analytics, Marc relies on data and algorithms to navigate the markets. He’s most famous as the inventor of the Chaikin Oscillator – which appears on most professional investing and trading platforms across the world. And over the course of his 50+ year career in markets, he’s managed money for billionaire hedge fund managers like Paul Tudor Jones, Steve Cohen, and George Soros. These days, he shares his award-winning investment tech – and his market forecasts – with more than 800,000 everyday investors around the world. And right now, Marc is issuing a warning that history may look back on as the investing equivalent of Tilly Smith’s warning to endangered beachgoers 24 years ago. So if you want to avoid any nasty surprises in 2026, it deserves your serious attention. Marc has nailed major market moves ahead of the crowd… In early 2022, he warned that the post-COVID bull run was vulnerable – just 90 days before stocks slipped into a bear market. 
Then in early 2023, he argued that conditions were setting up for a sharp recovery, shortly before the S&P 500 gained 26% for the year. 
And in early 2024, he forecast the S&P 500 would close between 5,600 and 6,000 for the year – a gain of more than 20% – while the median Wall Street forecast was for a 3% gain. Marc’s call proved spot on and was more accurate than 20 major Wall Street institutions. 
By early 2025, he was cautioning about a “violent shift” just before the S&P 500 plunged roughly 19% during the tariff-driven selloff. 
But Marc doesn’t just stick his neck out with bold calls to get attention. Like us here at TradeSmith, he backs them up with data. For over 50 years, Marc has developed computerized stock selection models and technical indicators that have become industry standards – including his popular Chaikin Money Flow indicator. And he pioneered the first real-time analytics workstation for portfolio managers and stock traders. So when I heard that Marc has a new, bearish forecast out for 2026, my ears perked up. Marc says 2026 will be the Year of the Bear… Marc has been warning his followers that the kind of bullish market action we’ve experienced since late spring is unlikely to continue in a straight line. Instead, he says 2026 carries an elevated risk of a major downturn. It’s just like how Tilly noticed the structure of the tides change ahead of the tsunami. The data Marc looks at tells him that something unexpected is on its way. And if recent history is any guide, the next downturn could be faster and more ferocious than what we saw this April or during the COVID panic. It’s not your grandfather’s stock market… or your father’s. Nearly 70% of daily trading volume now comes from trading algorithms. And according to some estimates, more than half of those automated systems have incorporated AI. Selloffs that once took months now unfold in days… even hours. We saw this happen just last month. The day after AI chipmaker Nvidia reported earnings, $1.5 trillion in investor wealth went up in smoke between 10:40 a.m. and 12:20 p.m. ET. That works out to $15 billion per minute for 100 minutes straight. It’s hard to wrap your head around. There’s no more “slow motion” bear markets – like in 2000 and 2008 – that give you plenty of time to escape. That’s why TradeSmith’s has partnered with Marc to launch our newest software innovation. For years, our flagship tools have focused on long-term risk. Our trailing stops, portfolio sizing, and overall exit discipline is based on the long-term average volatility of indexes, stocks, and ETFs. Those tools have proven extremely effective for long-term profit taking ahead of bear markets. But if 2026 sees the kind of hyper-accelerated volatility like we’ve seen over the past few years, you’re going need a layer of short-term sensitivity that long-term systems simply aren’t built to provide. That’s why we’ve created a new “early-warning system” for stocks… These new Flash Crash alerts are designed to catch the subtle shifts before the tide even pulls back. They meant to be the earliest possible indication that a stock is going through what Marc calls a “bearish personality change.” And they’re sensitive to even the slightest bearish tremor. You see, unlike traditional sell alerts – which look back years or even decades – our new system looks at the past six months of trading to map a stock’s “healthy” volatility range. It treats anything that falls outside that range as a red flag. The system doesn’t wait for a 20% or 25% slide to confirm trouble. It flashes a warning the moment a stock shows abnormal weakness, often weeks or months before a major drop. If one of the stocks you own experiences abnormal short-term volatility, it will automatically alert you. In our backtests, our early-warning system flashed alerts on: - American Eagle Outfitters (AEO) before a 69% crash
- The Gap (GAP) before a 72% crash
- Freshpet (FRPT) before a 74% crash
- Funko (FNKO) before an 86% crash
- QVC Group (QVCGA) before a 99% crash
To be clear, Marc’s roadmap doesn’t call for selling all your stocks and hiding out in the basement with cans of beans. And the early-warning system we’ve developed is not designed as a “get out of dodge” indicator. It’s a way to strategically find the weakest stocks in your portfolio… and prune them before losses get worse in the short term. Our CEO, Keith Kaplan, will be sitting down for a wide-ranging discussion with Marc all about it next Tuesday, Dec. 16, at 10 a.m. ET, during their new Tipping Point 2026 event. Keith will demonstrate how the new system works. And Marc will get into more detail on why he’s calling 2026 the Year of the Bear – including the disturbing pattern that’s played out over more than a century of data. You’ll also learn how to see Marc’s top-rated stocks integrate right into our software platform. Follow this link to sign up for free now. When you sign up, you’ll get access to our new Flash Crash Screener. You can use it to check on up to 10 of the tickers in your portfolio and instantly see if they’re susceptible to a plunge. But to get the name and ticker of the worst offender – a widely loved stock that looks doomed according to our new system – you’ll need to tune in on Dec. 16. Here’s that link again to register. I hope to see you there. To building wealth beyond measure, 
Michael Salvatore
Editor, TradeSmith Daily P.S. Marc may be one of Wall Street’s best kept secrets. His innovations have quietly influenced the way we think about trading and technical analysis, with the Chaikin Oscillator being a staple in Bloomberg terminals everywhere. And he’s also developed key technical indicators like the Accumulation/Distribution Line (ADL), the Chaikin Volume Accumulator (VAC), and the Chaikin Money Flow Indicator. That’s brought him into the fold of famous Wall Street traders like Mercury Trading president Jon Najarian… 
Longtime Mad Money host Jim Cramer… 
And even saw him ringing the opening bell of the Nasdaq stock exchange… 
I’ve been fortunate to meet a lot of famous Wall Street players in my career. But none quite so celebrated as Marc Chaikin. And if this is your first time hearing about him and want to learn more from the man himself, you’re in luck. This Saturday at 2:00 p.m., I’m publishing an interview with Marc all about his life and career, and why he’s partnering with TradeSmith today. Catch it right here in TradeSmith Daily. | 
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