Early Beginnings
November 4,2014
I posted this weekend that in the extremes that we were seeing in the Metals / Miners sell off, I am actually looking for the “CROWD” to be wrong. I expect that we could see a reversal and just advised that one ought to be on the look out for a possible “Shake out”. To identify one…I start to look for any “Signs Of Life”. I don’t get TOOOOOOO excited over the early beginnings, but I stay alert to the idea that if a big change could happen, maybe some signs of life could start popping up? To the charts…
http://www.screencast.com/t/btqvHGs9 <———-Click link to listen / click ‘download’ / click “open” – return here and follow along
1. GOLD was down today, one “Sign of life” was AU
Ok…Lets all Pile into NUGT now & enjoy the ride!!! Oh wait- lets not. One sprout doesnt mean we have a flower garden.
Lets look for more signs of life…
2. FNV – SLAM DOWN. BROKE SUPPORT, HUGE VOLUME…”MUCH LOWER LOWS COMING!” (Recovered today with GOLD down- Shake out?)
3. RGLD– Friday … Broke May lows. Technical break down – Busted “Support” on high volume…crash imminent! (Shake out?)
4. AUQ technical break down…Broke support, Much lower prices expected (Shake out?)
5. AUQ WKLY – Think about this , If price just holds here on a weekly basis, it will resemble prior lows reversals. What if it improves?
6. I posted this chart of HL in my weekend report . With SILVER doomed to $10 to $13, it looked rather normal.
7. So obviously I wanted to see it today with GOLD / SILVER DOWN (recovered so far)
I mentioned in my weekend report that ( FOR ME AT LEAST) there is normal technical analysis that when conditions are normal …it fires on all cylinders. ENTER EXTREME CONDITIONS and I have found that you get extreme technical analysis. I mentioned on the audio yesterday that A SHAKE OUT , CAPITULATION LOWS & REVERSAL, etc will often make people get emotional and fool them into thinking that Tech Analysis will play out as normal. Often , I have found …price projections do not get met.
I mentioned that some of my current price projections would indicate that Most Miners go Bankrupt and even GDX $8. Is it POSSIBLE? YES! Anything is possible, but at EXTREMES…often it is unrealistic because the chart is painting human emotions extremely over reacting… ( Miners with good management will hedge their product at higher prices, some close down operations, cutting down supply , which should cause shortages and thus higher prices in Gold return. etc etc etc) . Some do go bankrupt , but all of them? SO here is a quick example
The ICL in MAY fooled “The Crowd and most GOLD letter Writers”. You can read my archives at the end of MAY / Early June and i was writing what I am writing here about extreme readings. I kept hearing “Seasonal Summer Lows are JULY/AUG”- until then we’re going to crash – lower lows. ” “The Triangle projects to ___ ___ ___” etc etc . . I read about deeper price targets because of the triangle at that time, but I was getting those “extreme” sentiment and selling readings and felt the CROWD had to be wrong again. EXTREME conditions can fool normal tech analysis…and produce an extreme shake out too.
8. This is what the MAY “break down” & ICL (meaningful Lows) looked like, along side our current break down
I meant to write “Both triangle targets NOT met” on the chart. It was a shake out.
AM I saying “THIS IS THE LOWS, GO LONG!” No… You must trade it the way you see it
I am saying that as it plays out, remain unbiased and un emotional (Dont be overly fearful of overly jubilant) – we’ll look for clues that indicate that the crowd is Correct or wrong.
I also thought that the markets MIGHT top after Elections and then you might see Markets pause, correct a bit….Metals turn up / bounce a bit.
9. IWC today – symmetrically looks to be completing the recent move up. Each leg had similar “time” and “Distance”
10. And I posted these in the weekend report, this is a reminder of what my expectations are.
11. SPX – breaking New Highs often paused
I have posted some trades (PLUG, FCEL, BLDP , energy)
. 12. This was BLDP (At 10:30 a.m. – I was looking for strong volume of 3-4 million by days end )
13. End of day…I got the strong volume = Still Bullish – If the trend line got tested, one could add with a tight stop
So this update is just to show you what I am looking for going forward . If Miners that showed “Signs Of Strength” get weak again… proceed accordingly. If they start reversing across the board…it may have been a shake out . I am leaning in that direction obviously. I MAY NOT write a report Wednesday, but it is the day following the elections and MAYBE things could reverse? Markets top, Dollar pulls back and Metals recover?
Interestingly, The $XJY got crushed today , and METALS / MINERS didnt. In fact, Miners were up all day and as I pointed out above…some are even showing signs of recovering.
I may not have a report tomorrow , but I’ll try to TWEET if catch anything that looks interesting. You can follow me on twitter and please retweet this report or share with friends if you think they’d enjoy it…and thanks for being here too!
~ALEX
Thanks again!! as always
Ur welcome Liza 🙂
Thanks Alex.
Thanks again!! as always
Ur welcome Liza 🙂
Thanks Alex.
Alex, If the trend lines I show, are true, then this would be the logical spot for reversal. What do you think?
Sorry bhowe- I cant see the trend lines that you show & what time frame you mean (And I assume you mean Metals?)
I will be in 7 out today, if you want to try reply again, I can reply sooner or later
OH, the chart appears now. yes , looks good : )
Alex, yes GDX on the daily. Appears to agree with your analysis. Bouncing off the lower trend line.
Thanks for the great report! Any sense on GDP? Broke recent lows, missed earnings and gapping down 6% so far. Just wondering if this is even worth holding for a small bounce before bailing?
For peace of mind, stopping out often pays off, but if its a false break down its frustrating. Also Sometimes it gaps down and closes the gap within the first hour & provides a better exit, but you cant tell if its just going to gap down & keep dropping. Let me quickly look at a chart & get back to you here.
Nope…that was help enough…kissed it goodbye. At this price peace of mind is now worth more. Thx
I dont blame you. For what its worth…
I owned GDP at these lows on the XLE reversal and sold after the short cover rally….I was looking for a POSSIBLE new entry after earnings, DEPENDING on how it reacts. If today is a false sell off, you can tell by the reversal later on…you can re-enter above the 10sma or a break above this trendline. Then you can make your money back and write off the loss as a wash . It does have good upside potential IF OIL / ENERGY stocks are at lows.
Alex, If the trend lines I show, are true, then this would be the logical spot for reversal. What do you think?
Sorry bhowe- I cant see the trend lines that you show & what time frame you mean (And I assume you mean Metals?)
I will be in 7 out today, if you want to try reply again, I can reply sooner or later
Alex, yes GDX on the daily. Appears to agree with your analysis. Bouncing off the lower trend line.
Thanks for the great report! Any sense on GDP? Broke recent lows, missed earnings and gapping down 6% so far. Just wondering if this is even worth holding for a small bounce before bailing?
For peace of mind, stopping out often pays off, but if its a false break down its frustrating. Also Sometimes it gaps down and closes the gap within the first hour & provides a better exit, but you cant tell if its just going to gap down & keep dropping. Let me quickly look at a chart & get back to you here.
Its going to flush out today by the looks of it (heavy puke out). May reverse (shake out) too tough to tell
Scary to hold …sorry I cant be of better help, it could do anything here : (
Nope…that was help enough…kissed it goodbye. At this price peace of mind is now worth more. Thx
I dont blame you. For what its worth…
I owned GDP at these lows on the XLE reversal and sold after the short cover rally….I was looking for a POSSIBLE new entry after earnings, DEPENDING on how it reacts. If today is a false sell off, you can tell by the reversal later on…you can re-enter above the 10sma or a break above this trendline. Then you can make your money back and write off the loss as a wash . It does have good upside potential IF OIL / ENERGY stocks are at lows.
Thanks Alex for your insights!!
Thanks Alex for your insights!!