LOCKED IN AND LOCKED OUT

Some are locked into positions for better or for worse, others may be locked out of positions ( MINERS) that they hoped to own on the next run higher.  We have been buying and adding. Anyone holding leveraged positions may be in for quite a ride. Lets have a quick look…

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 At Chartfreak, I announced that I thought the next important low (ICL)  was in for Gold 3 weeks ago and began to buy miners.  Confirmation of that ICL came a little while later with a trend line break and a few other factors. I drew these  expectation in my Gold chart for June 14th, a possible run to $1400+.

While the BREXIT vote was going on Thursday, I decided to take a snap shot of Gold before I left for dinner.  This is where we were at.  I also thought that we could tag or slightly break the 50sma ( shake out) and then move higher. We hit the $1255ish area, just below the 50sma.

Later Thursday night, this is what we had. Unbelievable!  Gold was up $85, and the Dow Futures were down $677. The NIKKEI was down $1430 ! The US Dollar was up almost 3!

What next?

WHO KNOWS??  Think of all the margin calls coming with the Dow down 677. Think of the panic as people are either trapped in positions that they no longer want, or locked out of Miners that they didn’t know they should be buying.  As I wrote this report and watched Gold just taking off, it was exciting for those holding Miners.   For now, lets just discuss our bullish expectations for Gold  prior to the vote, and assume that they will still unfold,  just maybe at an accelerated rate. Maybe Golds POP bull flags for days and then resumes higher?  Maybe Gold dips down to test the break out and then goes higher? How it gets there remains to be seen.

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This was another GOLD chart that I had in a recent report. A move equal to the first run could lead to over $1450, maybe $1500+. A test of the 200sma was not necessary first.

I hear some that are holding Miners saying they just want to sell the open, “Gold is extended and must pull back.”   Locking in gains is not a bad idea necessarily, but I would only sell a partial position, and ride the rest with stops in case we continue higher.   Continue higher?  Is that possible? …

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This is all that GOLD actually did Thursday night.  It was a HUGE move,  but couldn’t it continue higher?  I would say yes. We are looking back at a consolidation from Feb to June.   Gold could run to $1500 in quick order in my opinion, but this is a news event  ( Brexit) and it may POP and stall too.

On the flip side, I guess that that could be a megaphone pattern forming too, and that would lead to a pull back sooner or later.

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GDX WKLY – This bull market could gap open over that 200wma.  That could leave people waiting for a gap fill, so that they can then have an opportunity to get in.  That power gap may never fill, and the Miners may leave the majority behind again, just like in the 1st run higher.      THIS IS ACTUALLY A 2 YEAR BASE, and has moved swiftly like a Bull.

I have been posting many bullish charts of Miners set ups to encourage readers to at least take a small position if they were concerned about this weeks Fed/Brexit activity.   Maybe just a small position in a few miners to have some skin in the game?  I mentioned that some miners are extended above the 200sma, but they can remain that way in fierce bull runs moving out of multi year bear market lows. Others were setting up and not yet very extended, so they might present the next opportunity  ( MUX, VGZ, ASM, etc). 

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I’ve pointed out bullish set ups in TRQ, SAND, IAG, TRX, BTG, etc .  They are still valid set ups, and will likely break out today. Here are just a couple of examples in case you are shopping.

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SAND WKLY – Broke out last week actually, and so it looks ready to follow through and continue higher

From Thursdays report  ( I hope you added , but it is probably not too late).

HMY 3-4  month consolidation.

BTG from June 16. So far it has done exactly this sideways move. It may never tag that 50sma for a 2nd time though.

From June 13- TRX closed at $0.48 Thursday

 Well what a shocking number of moves we saw last night in the futures. I expect panic session on CNBC, and we will just have to see how this plays out. The moves can’t really be sustained for too long, but I cannot tell you exactly how this will play out going forward. I dont think anyone can. Thankfully, we were able to see the ICL and (hopefully) you added some Miners to the portfolio.  Core positions held since we bought at the January lows also should benefit greatly.

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~ALEX