Partly Clear And Partly Cloudy

The short term trade set ups seem pretty clear, but with that Fed Wednesday Meeting rapidly approaching, the end of the week could host a number of reactions. Lets see how things are currently unfolding . 

.

SPX – This bearish wedge was forming last week  (March 9 chart).

The SPX did  drop quickly and recovered last week, as seen here.  Is this still a wedge though?

The Fed Mtg is approaching and could affect the outcome.

I DO think that it is a bear wedge,  we may see a dip after the Fed Mtg. lets see what Tuesday & Wednesday morning do.

.

Timing wise,  as mentioned in the weekend report, I believe that the SPX still has a little time before it drops into a DCL.  If, however, the Fed discussion starts rolling it over, we may see selling pick up, dropping and bouncing downward into a DCL.  

.

I wanted to go back to the WEEKLY View.  We have seen a lot of sideways action week after week after week.  We saw 6 months of sideways at the top.  We may see that here, another reason why I said that it may be too early to go ‘short’. 

 

Sidenote: I had mentioned a couple of weeks ago that the set up in 3-D printer stocks were setting up bullishly.  Check those out,  they are now trending higher and popping with conviction.   XONE, VJET, DDD, SSYS.  I lost track and did not buy the pullback, but I’ll be watching them going forward.  If the markets stall , top , and drop? That may end it  (Or are we seeing the start of something more bullish? These were leading the way down at one point.

.

$WTIC –  Oil is acting as expected.  It may stall in this area because resistance is evident. A sideways move could form an inverse H&S.  I expect a tag of the 200ma eventually. 

NATGAS –  I like the slow steady move out of the lows. Just like oil, it doesn’t look like a flash of short covering this time  ( And therefore, many do not believe that this move can continue). 

.

GOLD & MINERS

 

LET THE PULLBACK BEGIN  ( And I think it finally has)  🙂

In the weekend report I drew this chart –  “I would Sell at the first close below the 13 sma.”

GOLD – Look at the 13sma.  I honestly think that we are now going to see follow through and drop into the DCL  (Daily Cycle low).  It is a time for patience. 

GDX –  Ditto  ( yes, I wrote  firt and I cant change it now )  *FIRST.

I posted in the comments / chat section that I sold my TGD today for that same reason.  I bought at 10 cents & again here at 12-13 cents and just rode it for weeks.

Todays break of the 10sma was it.

.

So we are looking at Tuesday trading and Wednesday trading going into the Fed.  It may be reasonably cautious trading. I would love to see the SPX rise Tuesday and Wednesday, because I think that it would then drop after the Fed. I see signs of a temporary top in this area,  it should become clearer by  Tuesdays report.

At this point I just want to look at  (review) a couple of things.  We traded Commodities and have anticipated a buy-able pullback. It seems close.   Also mentioned here were  SHIPPERS and they are also lining up. Seeing is believing, lets take a quick look.

 

ANATOMY OF A TRADE

VALE – It was a buy able round bottom, oversold with a MACD cross.

Then formed an inverse H&S  (Notice the complex consolidation? We may see that in some energy stocks). Shake out type stuff.

And there it went.  Patience paid off, but it did take a while to get going. Target was about $4.80 as shown.

Here I began selling and looking for a pullback. It hit $4.87.

Maybe $3.50 and $3.75?

And now.  The selling has been so slow and methodical that patience should pay off. Each drop in this area has a wick, so I think it is being bought here. It could still drop to support and the 20sma.

The above is the kind of set up that could play out a number of bullish ways.   So if I am wanting to get back in,  I start a “starter” position now with a stop a little below the 20sma.   Add at support & the 20sma. ( It  COULD drop the 50sma, but I think it will see the 50sma later,  when it rises up to meet it weeks from now) .

.

The encouraging part is that we saw all of the STEEL stocks take off last week.  X, AKS, ZEUS, STLD .  That shows us that commodities are still actively being sought out.

.

We also watched CLF  at the lows with a bullish POP from an inverse H&S base.

Notice how long it can go sideways!  WEEKS! Boring, and then it popped 20% again. GET IN.

Look at CLF today.  A stellar run and a pullback as expected.  Today it flipped and popped 15% off of the 20sma. That may be it for this pull back.

FCX – Shallow pullbacks to the rising 20sma. It may be building steam for a push above the 200sma. This may not look like a lot, but you are looking at under $4 to over $10. 

.

CLD?  Slowly running away along the 8 ema for the last 12 days. It doesnt even need a pullback.

 

Do you have your list of Commodity stocks? SCHN & AA (flagging) STLD, CENX,FCX, AKS, X, CLF,  Etc. It may be buying time,  time to take a small position and build on it.

 

We discussed the shippers.  TOO, TNK, SB, NM, SBLK, etc.

This was my chart of TOO last Wednesday. Congrats to MS.Crystal and anyone else who caught it. ( I missed it 🙁  too many trades to take them all).

TOO broke today with a 34% Pop. I still expect higher prices, since this is still just inside of the base

Some of the ENERGY stocks are still looking good.  Remember that blue chart of CLF above showing how sometimes after a POP, they can just consolidate sideways for WEEKS and then it ran fast?  Well,   we may be a bit early and we may get some Pops and then sideways here too, it’s hard to tell, but the set ups look good. 

I am still watching these ( I posted these last week, but they’re still valid).

.

This was NADL today.  Looks good, could break out, but also could consolidate further.

 

As a reminder ,  I’m still watching these and they are acting correctly.

OAS did drop a little today.

 

SM –  Still a buy right here as it flags.  Again, doesnt look like much, but it ran more than 100%.

So that is your Monday evening report.  After the weekend report, not a whole lot has changed, but with the FED MTG fast approaching,  clues are in the charts. Lets see what Tomorrow brings.

.

~ALEX

 

P.S. – Put  WRN  (Copper and Gold)  on your buy list when it pulls back.