STATS

This report will be a report on the statistics of what was reported on in the weekend report…

Nothing has changed with the SPX, DJIA, NASDAQ.  It has dropped a bit and gone sideways.  No real change from the weekend report.  I want to add that I am thinking that we are watching a big shift.  I have seen a Topping in the broad markets this spring/Summer and a bottoming in the commodities.  This commodities area  MIGHT be the new winning trade.  IF it is,  you are getting in at the bottom of what could be very profitable investing/ trades.

USD – no real change either, I still  see internal weakness at this point, which is good for the CRB, WTIC, and METALS

CRB – from the weekend report.  I see Commodities as possibly bottoming longer term

CRB Aug 31 –  This chart shows a possible break out and back test. When these complete, ther may not be a reason to come back down.   

WTIC – From the weekend report.  A solid low,  you may be looking at  T-H-E  lows . Energy stocks are beaten down to death, and are coming alive in a huge way.

WTIC –  Huge move so far.  We waited for the break of the 10sma, and what a reaction since then.    I do NOT think there  will  be a straight move from $38 to $70.  We will have a stair-step higher, and the first resistance may be a reaction at the 50sma seen here.  The 2 purple lines show the spring rallies that we saw.  This one is very strong.

I have been saying that Energy stocks have been a great place to be.   They are little rockets , rising from their oversold , beaten down prices.   They  will have pullbacks and we will buy those pullbacks.  I will chart the entries when they come, and I will add some ideas at the end of this report.

GOLD – Gold is acting correctly. It is holding fib support  (not shown this time) and the 20sma.  As I write GOLD is up over the 10sma tonight.   We’ll just have to wait and see where we are in the morning.  I like the set up so far.

GDX – We sold off this morning  (As expected) , but then we got a reversal into the close  (not expected).  Trend line break Friday and back test this morning?  Look for a break higher . Bonus: Selling was light. 

 GDX 15 minute chart – Was the ‘sell off’ today  to get people to think we were starting another leg down and jump out?  I don’t know, but they sold if off for 3+ hrs from Noon to 3:30 Eastern, and in the last 30 minutes it rocketed back higher to the highest price printed today.  Very nice.

GDXJ 10 minute chart – The story was the same here.  The open gapped down and sold off. After a brief recovery, it was sold back down all afternoon.  In the last 20 minutes, we were back at the days highs.

So we are waiting for our 2nd daily cycle to begin.  Are the lows in? possibly, but more confirmation is needed and a move above the 10sma is the next step.  As you know,  I was a  buyer lower, but the lower risk buy is above the 10sma.  Often we get that initial run up, and a pullback to buy , and then the 3rd wave higher is really the one that you want to be in.

SO I have been trading / investing in ENERGY stocks and I have recommended many here  ( in a list) that I think will benefit over time. Why? I’m  pointing out that the break out in oil is real and I even mentioned not to fear that if these stocks are up 10 % , you missed it.  These can run 100%  ( And now many have).  If you didn’t take position,  not to worry.  I believe we may be seeing a REAL SHIFT in the focus of the money flow, and ENERGY, the Commodities, and Metals and Miners may be the next big score, as the general Equity Markets are taken down.  There will be pullbacks , and a second entry point.  I will point those out in the future, for now lets look at more charts.

I look for good solid bases  ( if you were here in the Spring, you may remember this lesson. Bases POP).  When price gets above the 10,20  sma, it can really gain some traction.  THEN at the 50sma, it may get some selling  (2nd Buying opportunity).  Lets review.

Energy Stock patterns

REXX – Was a leader. It ran up to the 50sma already.  Pulled back, and now is going for that next leg higher.  If you saw an Energy stock that you like and it ran off without you, it may do this.  WATCH THE 50SMA and pullback. 

GDP -I posted in the comments this morning that bought this today in the 70’s, because it had the base and sudden push above the moving averages.  It doesn’t look like much, but I will show you why I like the set up.

I saw the same set up in MANY energy stocks last week and they burst higher.  See the RED ARROW on …

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WRES – That POP above the moving averages last week  was the start of a move. It is almost 100% higher, but after a pause, I believe it could double again.  We may be looking at some double baggers, triple baggers, etc.   ( The initial POP in late July didn’t stick, likely because OIL was still selling off).  That initial POP was  a sign of strength in a sell off.

Let me show you another view. Look here at …

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WG  –  Excellent long base, but really lagging, right?  Will it move??? It was $6.50 only 6 months ago! Could it recover?   For starters,  “No, Its not really lagging.”

WG  – Here we get a closer look. It is up over 35% off of the lows.  It has started to climb.  It is near the 50sma, so it might pullback or maybe it’ll break out and tag the 50sma on a pullback later, but I read the news release and they are trying to cut cost, and make improvements to weather this storm in Oil.  If Oil recovers and they do too,  another possible 600% to March prices.   WG was $12 last AUGUST!

PACD – just getting going.  Nice move so far, but cant you see the potential if we are at THE LOWS in the commodities sell off? PACD was $10 last Aug.

So we are seeing nice moves in Energy and the CRB.  Gold , Silver, and the Miners have also moved up off of the lows in July / August and look to be at the DCL or about to put in the DCL.  The 2nd daily cycle in Gold, Silver, and Miners is usually the explosive move,  so I want to catch that too.  A  close above the 10sma is a buy for GOLD and Miners ,  just use stops if it reverses.    As oil approaches the 50sma, it may pull back and that could cause a buying opportunity in OIL and Energy Stocks.  Things look good for the next few weeks.  This is a buying opportunity. As I mentioned , I will try to help build confidence along the way, and pullbacks are normal and also an opportunity.  Happy trading!

~ALEX