Another Slow Week Ahead?

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The holiday week has many people checking out early and preparing to spend time with families.  That means that this can be a week of slow trading, but that can also set things up for the next directional moves when traders return to work. Lets see what happened on Monday…

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SPX – Bounce today.  Will it blast off higher? See the wkend report. 

SPX 12-21

 

USD –  I said I expect the USD to roll over.  I do and it dropped Monday, but….

USD 12-18.

The USD  may not roll over and simply drop quickly.  It may find support at the 50 or 200sma and then bounce around as it did in previous weakening areas.

USD 12-21

 

WTIC –  I mentioned a possible low coming in soon. It may not be The Final low  ( my weekly target is  $26+ ),  but it could produce a bounce.  A move / close over the 20sma would have me re-examining whether it could be a final low. So far,  The XLE doesnt look that great, but it is holding above the Aug lows, Oil has not. 

WTIC 12-21

 

NATGAS –  From the weekend report, I was expecting not only a minor low, but possibly The Final Low.  Recall that the WKLY chart showed how it was outside the B.B., and this daily chart has a reversal in the timing for a low. 

NATGAS 12-18

Boom – This certainly could be a bit of short covering, but notice that none of the other ‘lows’ at the B.B. sprung up like this. This could be an ICL and could move a lot higher over time.  ( This is just a Possible path shown, it may just run over the 20sma to resistance at $2.25 area too). It is still very oversold.

NATGAS 12-21

NATGAS is now at the point where if you read the weekend report and

  1. Took a position Friday or today today –  I would ride it, and maybe sell some on the way up.

  2. If you want to buy in,  you could start small or wait for a pullback when it comes.  Unfortunately it may end up pulling back at a higher price than where we are now.  Why? Sentiment has been HORRIBLE,  with  Fear and Loathing-  so this could short cover rally into the holidays.  I have no way of knowing once it gets going.

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 GOLD – Gold looks good. It began to break higher on day 12. Gold closed above the 10 & 20sma and a small trend line . 

GOLD 12-21

 

SILVER – The Silver chart looks good.  The MACD held up nicely with all of that Crazy volatility last week. 

SILVER 12-21

GDX – I’m going to show 2 GDX charts.  Is the GDX about to break higher like Gold & Silver just did?  This is the bullish view, and  It looks good. The cycle timing is fine for a DCL on day 20 last week, so that is good. Prior break outs above the magenta line did a POP & RUN, so we’ll know quickly,  but lets look at another view. 

GDX 12-21b

GDX – this would be the entertaining the thought that Gold Bottomed first this summer and GDX bottomed later,  in September.  So maybe Gold has bottomed now and GDX bottoms a little later again?

   1. It is a bit early in the daily cycle, they can run 26 -30 days .

   2. The stochastics didnt reach normal oversold yet. 

   3. A 3 day dip slightly below the lows of 3 days ago entends this cycle count, and frustrate traders.  Then it can form a swing low and run swiftly.  I want to see SEPT & Nov lows hold preferably .  See the next chart of the HUI.

GDX 12-21

 

HUI lows of 2014 –  This is very similar to GDX now.  

  See the  peak on day 9 ( we had a day 11 peak), and then the HUI  had day 16 look like a dcl, but it rolled over. GDX just had what looked like a DCL on day 18 last week, it rolled over. The HUI then popped higher on day 23 and the day 22 lows looked like a DCL.  One more trip lower shook people out and off it went higher after day 28 low  ( It still maintained higher lows).   THAT is frustrating, so I am showing you this here in case Miners roll down while Gold shows strength.

HUI 2014

 

   So GDX may just burst higher and break out tomorrow,  it is at the Magenta trend line that I drew in.   If it doesn’t break out,  I wanted the above HUI chart to show that it may just be adding some time in before putting in a DCL. Miners  bottomed after Gold this summer, so they are not in sync anymore.

 

Oil may be bottoming, we’ll see if it can get above the 10sma, and NATGAS  made a bullish move and I expect follow through over time.  Things may slow down a bit  in the markets as we move toward Thursday, since it is only a 1/2 day of trading Thursday (in the U.S. Market) and they are closed Friday.  Happy trading!

 

~ALEX

 

P.S.  SA  hit the 50sma a few times recently.  That has been a good place to buy , and will no doubt be a good place to buy for the next run.  And a ‘stop’ can be placed relatively close by in case it wants to drop to the 200sma if the Miners are not at their lows yet.  The chart remains gorgeous.

sa 12-21

55 replies
  1. thebeek
    thebeek says:

    Thanks on your homework gdx and hui, once again. gives my reasonable perspective balancing continuing trepidation from other blogs. Great eoy 2014 comparison which kept many watching watching. Oh well nibbled a bit more today.

    • chartfreak1
      chartfreak1 says:

      Hi Beek,

      Had to read that comment twice : )

      I remember GDX & HUI last Nov 2014 well, because it frustrated me a bit with those false starts that were within the timing for a low. Then it finally took off upside.

      Holiday trading can be odd at times too, so we’ll see what we get between now and the end of the year.

  2. Bill
    Bill says:

    Alex, I’m having a tough time here with the miners. I’m looking at GDX (refresh). I see the sell off and the retest (the loop) which we usually get, its telling me to go long here. But I have noticed we are on day 9 of this half cycle? They usually go 11-14 days. Too early, IMHO. In the recent past, these patterns play out bullish, but there have been cases further back that have broken down. Thoughts anyone?

    • chartfreak1
      chartfreak1 says:

      There are a small number of things that could be taking place. A short 20 day daily cycle ma have just occurred, or this may do what HUI did and drop again into a day 28 or so daily cycle low. etc . I think we will see upside soon, but this is the process of putting in lows and it can vary from DCL to DCL.

      Confirmation is often considered a break & close over the 10sma and an overhead trend-line break out.

      Hope that was helpful. This may not be a 1/2 cycle low.

    • Cason
      Cason says:

      The last two years, this thing started to run right before year end and then ran hard in January. I’d keep watching and just be prepared to buy a breakout. Lows aren’t far away so you can put a stop there, not a big loss to that point and if it’s wrong you’re out pretty quickly. I’m still on the sidelines for now.

  3. Chris
    Chris says:

    Hi Alex. I could be wrong but I’m not sure your usual email alert to a new report went out today. I certainly didn’t get my usual one and just wonder if others may be in the same boat although hopefully they will check the site anyway.

    • Cason
      Cason says:

      Alex, I did like miners ability to be pretty stable all day despite downward slide in gold. Controlled, no panic, no over-reaction.

    • chartfreak1
      chartfreak1 says:

      UGAZ is a 3xetf…you will experience sharper drops and sharper Pops, so NATGAS can have a normal pullback and UGAZ could drop 10 – 20% in a day.

      That said, NATGAS has sold off to a very extended point. It was due for a DCL and most likely it will prove to be an ICL.

      We now had a strong Pop and a daily swing, as I pointed out in the report. Thats a daily cycle low most likely. Now if you pull up a weekly chart, we have a swing low in place on a weekly chart also. So Natgas looks fine, down on a normal pullback so far.

  9. Cason
    Cason says:

    API -3.6M vs. +1M expected. Govt #s 1030 tomorrow. A draw could push oil and confirm DCL, especially with low volume bent and uber-short bent recently.

  10. Cason
    Cason says:

    I liked the action today. Recently been convinced on the Bear case for SPY, Dow and friends. However, I’m still playing the Santa rally to the long-side to capitalize on low vol, low volatility through year end. Then looking to clear those trades for cash and jump aboard the Jan miner train.

    Energy is all over the place. SGY decent today but got wrecked last 3 days, BAS quiet and efficient, BBEP big pop from way oversold. I do like some MACD and stoch alignment I’m seeing, will look to post later. XLE remains sloppy, at best. Seasonals should support oil next 6 weeks or so, possibly lines up with DCL theory.

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