OCT 28 Just a quick update because we are in the FED ZONE again. The picture above depicts what can happen after the FED speaks on Wednesday , and that can be in either direction. With that in mind, I hate to recommend trades that can really get smoked to the downside, but I do have some pretty nice short term set ups forming, so lets just discuss a couple of things here now, and see how things play out moving forward into the Fed day and beyond.
Oct 23 – I thought the SPX would get stuck under the 50sma , maybe even dip to the 20sma . I posted this
The following chart shows that we have done exactly that so far…SPX remains under the 50sma on a closing basis (as I was writing, it broke above)
Going into the FED, the direction could easily be clarified , but notice the $TRAN. This looked quite strong.
HOWEVER, that could be misleading. If it is just short covering coming out of that sell off, it could suck people in and the FED could cause a H&S. THAT is why I hate to recommend trades here…Its not a LOW RISK ENTRY. Its not that I will never recommend a trade around Fed times, but this is a higher risk entry with SPX stopped by the 50sma and a possible resistance here. ( It may close under the 50 , too early to tell ) If we were at the end of an extreme sell off & possible exhaustion lows with divergence seen, it may be worth a trade long, assuming that the fed reaction was already in, downside would be minimal, a possible bounce or short cover rally could come of that Fed mtg.
I am still watching the Dollar, here is an older chart, with an updated note. The dollar DID hit $84.50 since this chart was drawn up
I will tell you right now that the dollar is weakening short term . It looks strong, it is weak here and now short term. look at the MACD on this chart. THAT doesnt fly
So if the dollar is going to drop further, wouldnt GOLD & SILVER benefit from the Fed Day?
MINERS reacted UPSIDE to the FED MINUTES Oct 8. Many shorts got caught. Could it repeat? I’ll just show you a chart.
I have seen some very interesting trade set ups, and I will share them at the end of the week. I did draw up a couple of charts (A few people requested them from me ) so I will share them here now. They are interesting set ups, but again, FED DAY is tricky at this point.
STEM (by request this wkend) not much has changed , it looks bullish.
Last Night I found this and liked it as a bullish set up. It is breaking out (GAMING)
HGG WKLY & DAILY
For now I will leave it at that, but I think after the FED WED reaction, we MAY get some solid direction. The picture may get clearer and it may even get explosive in some sectors.
I have relatives visiting and have plans on Thursday, but I hope to get a pre market report out , because we will be post Fed and may get some clarity. Before that, trades may be short term, it can be prudent to decide not to hold anything into Wed afternoon, unless you are up in the position and able to stop out . At least its an intraday reaction , but whip saw can stop you out only to watch things flip & go higher. Its frustrating at times, so stay clear or stay Frosty!! Best to you….