Leap Of Faith
Just a short report for Friday, where we’re discussing a leap of faith 🙂
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Before anyone can consider taking a leap of faith, you have to know where you are and where you are heading to. Let’s do an overall review and that will tell us where we are and also where we should be going.
GOLD was late in the timing for a daily cycle low. We had a swing low in place on day 26, but it was ‘unconfirmed’. I pointed out how unconfirmed swing lows are to be viewed as a bit risky, they can give way to more selling , and this week I used OILs chart to point that out. Yes, this looks like a giant Head & Shoulders pattern.
GOLD – So we could see this. I added this so that if it happened, people wouldn’t panic or freak out. All would see that it is acceptable ( even desired if you are ready to buy, but it will take a leap of faith).
GOLD ON THURSDAY – Now we have a slightly lower low of 1210.50 as of Thursday ( Edit, overnight low of $1203 ish). That means Thursday was now day 29, and we are very late in the daily cycle. Volume is also drying up at this point. Gold usually bottoms around here, but I have seen them rarely extend to day 32 or 33. I want to say that as of day 29, I do not see a lot of downside. I will begin buying this dip ( reversal) on a leap of faith before a swing low is in place.
GLD – GLD now actually looks a lot like it did in May. I bought those May lows on a Leap of faith, and when it Gapped open in June, many then had trouble buying. Understandably, they feared that we’d see a gap fill after they buy. If they waited too long, they were locked out again.
I had discussed on Nov 11 that a run of all of the stops going way back to the spring could be in the works. Picture a boat load of technical traders ‘stops’ at those lows to protect their positions. Big money could trigger the selling and then scoop up Gold on sale. A drop below $1200 is possible.
GDX NOV 14 – We already saw the April / May lows in Miners taken out, so will miners sell off with Gold or are they already at the lows, able to resist the selling?
They could sell down further, but …
GDX NOV 17 – GDX could sell down, but so far it is holding up better than the metal itself. That also happened at the lows in May. Also recall that some of the stocks I own still have not broken the October lows.
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As mentioned in prior reports, look at weekly charts of HL, GPL, BTG, AG, IAG, etc. The Weekly charts show October lows are the lows so far.
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Conclusion: It is decision time, and only Y-O-U can make this decision for yourself. “When should I personally take a position or add to my current positions, based on the evidence in the Chartfreak reports?” If it helps, read Wednesdays report again. Read Thursdays report again. The choice is this…
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1. Should I buy Miners (at least start positions) if they dip and reverse higher before a confirmed swing low forms. We are very late in the daily cycle and due for a low. You are realizing that another day or so of downside could happen, so wait for a reversal. The leap of faith is that we believe that this dip will be quickly erased on day 30, 31, perhaps 32. Remember too that some Miners are still holding the October lows.
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2. Should I wait for a swing low to be ‘confirmed’ next week, knowing that the moves out of an ICL will make great gains for weeks to come anyway? You know that you have plenty of time, and want to play it safe before getting too heavily invested. This is safe and should still prove to be very profitable.
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I have been reading the comments and maybe you have too. If so, you know that I have some readers saying, ” A low must be close based on timing, I’m getting ready to buy a reversal.” Others get a little freaked out on any down days. ( I’m not picking on anyone at all here, it is posted publicly as an expression of frustration for all to see) 🙂 . It is common for many to feel that way when day after day we are hoping for that burst higher and it doesn’t come to fruition. Any selling upsets them emotionally. It is also a good indicator of how things seem or feel at the lows. I understand.
As the author of Chartfreak, I am well aware through email discussions that I have readers of all levels of experience and all levels of risk tolerance, so I cannot recommend this as a ‘safe buy with out risk of any drawdown at all’. I know that we could sell down for another day or so, or we could just rally higher from here without most people wanting anything to do with miners. What I do know from my own past experience is that if we are entering day 30 and are approaching our yearly cycle low ( YCL) , Intermediate cycle low (ICL), and daily cycle low (DCL), most if not all miners should be much higher than todays prices in the coming weeks. Look at the move from January to April. Look at the move from May to July. Those are moves out of ICL’s. I am buying the dip & reversal, instead of waiting for the safer confirmed swing low buy, which is to wait for a swing low and then a close above the 10sma. It is taking a Leap Of Faith, but I do it every 4 – 6 months under the same grueling conditions. Each year these are the best gains I make in trading, even if I do decide to wait for a swing low to become confirmed.
Honestly, this isn’t a bravado contest or a test. If you cannot sleep at night when something that you own drops down, do not buy before the weekend, before a confirmed swing low is in place. Why ruin your weekend? There is nothing wrong with waiting, you will make good money if we are rising out of the ICL. Weeks and weeks of gains are ahead. I personally do not mind taking a leap of faith, because if this is the ICL, I know my positions will be much higher in the coming weeks. We should actually rally into 2017 from here (Pullbacks will occur along the way, I’m not saying that it will be all straight up). Enjoy this Fridays test of Faith and trading. Enjoy your weekend even more! We all deserve a nice weekend after grinding out these lows this week, and I think next week could be an excellent reward for your patience.
SMILE! – Today is day 30 of Golds daily cycle
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~ALEX
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Alex, I didn’t get the email alert again. Found this at the top right on yesterday’s report.
Thanks,
I can’t do anything about website technical problems, I have someone that works on that.
Can you go to the support tab, drop down menu ‘contact us’, and then it gives you an option to email Alex or Tech support. If you let them know, they can work on it. We thought it was fixed by now.
thanks
Will do.
Tell them Alex sent you – lol
AH, another bonus report. You work hard for us Alex,you are appreciated. I added another dab of NAK yesterday and a small starter in Silver Bear,can’t be scared at these ICL’s.
Thanks Crawdaddy,
Day 30 should prove to be very close if not the low. Not always easy to buy, but rewarding when it’s an ICL.
Hi Alex. Based on your recommendations I have a basket of miners accumulated over the last couple of weeks – some slightly up and some slightly down. And I’m not concerned about holding through some more downside as I expect it to be short lived. Big question I have for you is – If you could buy 1 only miner today what would it be??
If I was limited to 1 only, I think it would have to
1. Already have released earnings
2. Be showing strength as a result, like a higher low than October ( Although PAAS earnings looked good and it has a lower Oct low, because the earnings came out later)
3. I’d have to research it fundamentally, which I do not always do – I just let the chart speak for itself.
4. I usually see juniors or Silver stocks get a better % – Gain so it would be one of those , and…
Since # 3 said that I’d need to do more research – as a cop out, I’d have to say I do not know what I would choose if I had a limit of just 1 Miner. – lol
Love it! 🙂
He’s not only great with charts folks, he’s a master diplomat as well!!
My Sociology teacher used to call me Mr. Gentle persuasion
In the above, I’m Persuasively Neutral – lol
Mmmhmm….. I could think of a couple other choice words as well… 😉
Charming and debonair? Why thank you Miss Maria
*insert gif of me rolling my eyes …………
Excellent excellent excellent …. Job of
Laying out ALL the facts — ad nauseam 😉 & reminding folks that buying/selling is a personal decision & theirs alone to make. 🙂 #personalAccountability
Thanks again for your tireless efforts this week… I’m sure you could use a nice vacation about now… It had to be a brutal one 😉
https://uploads.disquscdn.com/images/545272d926674bac371915364282e8a0790f8d9eceb602907555c2fafea2faea.png
Thanks, and I was wondering where you have been. It’s been pretty quiet around here with out you.
We will see from the rally out of these lows ( ICL) if the Trump Election seems to have changed anything here, but I have a huge feeling that nothing has changed. The Fed is even openly speaking about inflation. Conditions favor a precious Metals rally into 2017.
I am just looking forward to a nice rip your face off rally out of an ICL , to bring good gains to the readers here ( oh, and me too)
Maria Like Hockey and Soccer? #HB #Goals
Awwww… Did u just try & make a funny?
*stick to ur day job
Hi Alex, thanks for the well written report, am already liking my subscription. Price-action on Gold today somehow reminds me of post-election day in stocks, as they were driven by extensive short coverage. Think the bottom is in, people won´t believe at first and keep on adding shorts until we get a squeeze. Have a good day folks.
Hi Phillipp, and That’s what I love- The short covering rally that eventually turns into a ” Buyers chasing the rally higher” type move. And thanks for the comment about the reports, I’m happy that your enjoying them.
I hope you’ll find them to be a helpful addition to your trading style over time,
as well as the additional commenters comments here : )
..if this was all “orchestred” by the big guys then I owe them a lot of respect for being so creative. My guess from a psychological point of view is that 1200 will not be breached as everybody especially average joe and retail traders mostly focus on barriers like these. Anyhow, right now there is indeed an almost perfect correlation between USD and Gold, so we will see if Gold can disconnect with the USD surging higher (which can possibly still go on for a bit)..
I was thinking the same. I am about 50 / 50 with which way this could go, but the later it gets in this daily cycle, I am less convinced that 1200 is taken out. If it is, it will reverse quickly.
I am thinking that many are probably building short positions , viewing this as a large head and shoulders.
They could get caught on the wrong side already.
Alex-just wondering whether you see any technical similarities in gold and GDX between that large head and shoulders pattern running from July 2015 and January 2016 which had a false breakdown and the one now formed which is either is in the process of breaking down or faking us out again? Wouldn’t much depend on how the USD/JPY behaves? Gold and that dollar/yen ratio seem to be moving in lock step. I’d prefer a break of 1200 and a lower low in GDX assuming we are still in a bull:)
Hi Mark,
I actually do not consider the July 2015 – Jan 2016 formation at the lows as a H&S.
A true Head and Shoulder pattern happens at the top of a run, due to exhaustion of buyers.
I’ve seen others call them at lows, but it doesn;t fit the psychology of a true H&S to me
As for the GOLD AND USD/JPY – I did a big write up about the relationship of the Yen and Gold in past reports, and I do see them as correlated ( not exactly timing wise, but they do follow each other at times.
If you want to read that YEN & GOLD report, I could look it up, but it seems that you have already come to understand their relationship.
Interesting. I’ve heard you say that before I believe from you on the H&S. I’ve been glued to your analysis on the USD. That would tells us just about all we need to know about the PMs.
Boy, was that all so poorly worded. You get where I’ve drifted I assume:)
Yes, The USD has morphed into such a bullish looking set up. Using cycles , it can be argued that it is due for a deep dip, and may be doing a false break out to the upside. After this draws the bulls in, it gives it all up ( Like a shake out top-side).
We’ll have to see
Alex the Yen & Gold relationship is new to me. If you do have the report around I would love to see it. I’m always hungry for knowledge.
Feb 8, 2016 report “In search of a bottom” –
In many reports from Dec 2015 onward, I was trying to explain why I felt THE LOWS were in for gold, and one reason was the relationship of the yen to Gold. I had charts in that report.
gotcha, thanks
How do you feel about that relationship now, Alex? Unless that has been covered with your most recent posts on the USD.
From my report, you can see that they were never lock step , tick for tick mimicking one another, but very similar in movement and path direction. Last Dec when I was calling the lows in Gold, SO MANY people were saying GOLD has to go to $800- $1000 before it can rally. Most of my readers here were torn about that. I was trying to let people know back then that the YEN bottomed, Gold has too in my opinion.
People needed a confidence booster, based on emails that I was getting, I couldn’t get many to buy and hold, even by February.- though Miners were up 30- 50% in some cases more.
Today – .Look at a chart of Gold now and Look at XJY.
Both bottomed August 2015 , XJY bottomed in Nov 2015 , Gold Dec 3rd…both ran higher for a long time. Both bottomed in May ( ICL) Both are now approaching May lows- hovering right above them.
I’d say that it was a good call for me to say back then, watch what the YEN does, and Gold should be similar. : )
Reviewing the Jan 2016 reports has been eye opening. I think that final “V” bottom was less of a drop than we had last week but it was a real freak out time too with good results for the brave.
It almost always is both of those : )
yes please V bottom… 😉
It will need a catalyst first though…..what will it be ? ……
That is where the Shorts will need to cover…..V bottom.
What the heck is happening to markets all over the world?
The answer to this is … there are no markets. There are no legitimate markets from bonds to Gold.
Computers are trading with computers and that is all there is.
These computer run markets are virtual markets and that is all there is.
The computer run markets create prices which are so virtual that there
its no depth to any market anywhere on anything. Volatility goes wild as
computers overtake markets. Central banks, lacking no practical tools,
are pushing the panic button. (Jim Sinclair)
What are your opinions out there?
nando
pretty cynical .. but probably true.. who only knows
….in any event .. there are still profits to be made ;o)
Thanks maria,
it helps that you think computers does´t influence the world of trading too much, so we can make money, but I am concerned about the percentage of the computeralgorythmen and how they affect our chartreading and volatility.
well .. there are tons books, articles, etc. written on that subject …. here’s the first one I just found…
it’s from 2012 but covers the “basics”
… remember it is still a HUMAN being that sits down to write the program … in terms of EW — waves still occur in sequential order.. they just look crazy sometimes….. 😡
https://bclund.com/2012/08/02/5-ways-to-combat-high-frequency-and-algorithmic-trading/
Thank´s maria for your rec. Nice trading week.
Too hard to share my opinion on this here, so to summarize
1. I do believe that computer trading and programs do affect the markets to a degree
2. If those are Jim Sinclairs honest feelings, then I find it odd that he, by his own free will, chooses to own a publicly traded company and leaves the fate of that company up to a virtual world of Bots.
Central Bankers via the Big Banks are the Ones with the Bots………imo
A good read to help debunk some of the conspiracy theory stuff is “Dark Pools and High Speed Traders for Dummies”. Written in a simple way for people like me.
Excellent Report Alex…..
aaaand they’re off. AUMN come out of the gate quick – up .02, CDE and NEM and PAAS are right there with her, the rest of the pack better wake up, and there is that young NAK shaking her head and dragging up the rear. A lot of green jerseys today…….what?
..and i was just debating with meself where to put a catastrophic sell stop for AUMN
AUMN doesn’t look bad? Crawling along the 200sma
it continues to confound
I think my Short Interest feed is delayed quite a bit, but if it is still at 10.2 days for AUMN, that is why I’m in for a possible squeeze.
I sold last week then bought back. You could do that rapidly buying and selling AUMN, Might be fun!
hhaha.. ive already done that a few times past month.
at least it was at the same price
Sigh…Just another example of the Deceit of the Big Banks:
JP Morgan Chase hiring inexperienced family and friends of Chinese Officials in order to win big business deals for the last 7 years.
Fine: 264 Million….
I’d like to know the number of the profits they made from the big business deals, to see why it is always so worth it to them to take the risks.
Apparently much larger that any fine that they might occur if exposed……
Alex, a couple of reports back you said there was a confirmed swing low in oil, but you expect weakness in about a couple of weeks…..why is it that you are expecting weakness? So you think the cycle will roll over? Just wondering so I’ll know whether to look at any oil stocks seriously or not…thanks!
Alex, when you answer this could you also comment on BBG? How does the chart look to you with a coming oil pull down?
BBG is in the middle of a move. It is neutral to me at this point. If it pulled back, I’d look at it and see if it was a buy then, but it is not allow risk entry here because it could pull back.
Weeks ago I mentioned that Oil was breaking down early in an intermediate cycle.
So yes, I expect that this rally out of the dcl would remain stunted to some degree, and eventually head lower.
DRYS up 56%, BUT started from only $11. Not too crazy. Most of the other shippers are calm. MJs are calm too. Maybe the crazy times are over for now.
Nice reversal in NAK
No one tell NAK it’s a gold miner
Gift 😉
I lost mine. Got scared last week. 🙁
Interesting gold action overnight. I took a very small position in JNUG yesterday to keep me focused so it’s in the red. I am curious how the yellow metal plays out today.
Some seriously good reports by Alex this week. Thanks!
well, it seems you’re the only one being curious : )
Sorry, I don’t understand
we’re all waiting for this damn thing to go up – you’re not the only one : )
You’re ‘probably’ not the only one holding a little JNUG to stay focused either 😉
whatttaya think of HK (chartwise) … looks like wants to do a lil sumthin sumthin ….
Yes, agree. So many of the energy stocks remain healthy looking ( OAS, REI, AREX, WPX) despite me thinking that Oil doesn’t .
Counter-trend signs
of exhaustion are widespread- Demark
indicators such as TD Combo, TD Sequential show completed Sell setups in quite
a few equity indices along with sector ETFs based on Thursday’s
close. (CCMP, NDX, INDU, SPX, SOX, KBE, XLF, XLI, KBE, IAI, KRE, XLE,
XLY, among others) Fully 4 S&P SPDR ETFs show completed TD Sell
Setups while the S&P December Futures contract has just signaled a TD COMBO
13 Sell signal along with the completion of its own TD Sell Setup, which
mirrors the Setup seen in the NDX within striking distance of September highs
Hasn’t mattered much has it? Dollar overbought, yen oversold, bonds oversold, Financials overbought and no one cares. We have really been living in crazy town for a week, man. This is nuts!
Kissy kissy kissy
anyone tempted by UGAZ UNG here?
its flashing a buy and i might take a nibble
Brilliant call … hope you took it 🙂
i havent yet, its just traded a tight range of around 50c since my post
I thought you meant UGAZ and saw it was up 11% today ..guess that was a premarket jump…
i did mean UGAZ.. jst bought a small taster now.. and it did gap up at open
Yeah, UGAZ run was almost entirely pre-market but starting to like gas here.
Yes, that does look good, kind of like the 1-2 , if ya know what I mean.
i do.. and no triple wigwam teepee either 🙂
YES!!
Alex, can you please give me your opinion about FNV, RGLD and AEM. The october lows are intact. Thanks nando.
Hey Nando – All 3 of them look really good.
I think RGLD sold off hard and did a shake out complete with reversal. Those lows may be ‘in’.
FNV has such light volume today, it just doesn’t look like people still holding want to give up thier shares, and AEM is the same .
Pull up an 10 sma and you can see that the first run up stalled there, this pullback ( As gold bottoms) may just sling shot them through the 8 or 10 sma on the next try.
CAN THEY break to new lows if Gold sells off quickly? yes, but they look like higher lows right now and selling is light. And RGLD does look like a quick shake out took place.
They look good.
Thank´s Alex and great weekend job too!!!!
Sorry november lows
Disclaimer : I own GPL and have been accumulating along these rounded bottom lows, but I just wanted to say…
Have you looked at a 2 year weekly chart of GPL? It is stealthily up 11% this week, when Silver is at lows.
( Refresh)
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https://uploads.disquscdn.com/images/5444d34d8059fdfc2008cde47ff930eec666e42e6a0e0efda78f928db4821b7d.jpg
my KGC is a pile of poop compared to the GPL.
from a few days ago its -8% vs +8% …. merely acting as a hedge
Hi Alex,
I have been holding a large stake in GPL during this down trend in gold. With GPL holding up well and actually up today, would it be smart to move that capital into NUGT after a swing in gold to maximize upside potentiel.
Define “Smart” : )
I’m sorry, but I just cannot recommend this move one way or the other.
I have done it in the past at ICls, but then again, Trump wasn’t elected a week earlier , causing a $130 swing in Gold in only 3 days.
I better wait for day 33! Just in case… Thx
Curtis, maybe, but I’d wait. I got into JNUG early and it sucks so don’t make same mistake. GPL has looked good this week so I expect it good be really good once metal stop sucking. I don’t own it, however.
GPL my only sunshine 🙂
BAA is killing me. I should have sold when it reverted back through my cost basis.
BRIZF is my new favorite which I bought at its 200MA.
BAA…small position but it’s actually hurting my account the most! Ugh!
I have that too…red….am hoping when gold goes up, “all boats will float”!
Actually, everything I own is killing me. Except maybe AUMN, which is kinda weird!
Alex, if it is still there when you check, look at the GPL 5 min chart. Accumulation or distribution?
There was a buy at 1.38, but that did not set off a rally. 🙂
If I understand this right, at this time of day these could also be dark pool trades that were done earlier and are being back loaded into the system. They are apparently often executed at 1/2 way between the bid and the ask. If anybody else understands how these dark pool trades show up I would love to hear from you.
New to me. Thanks.
I have heard the same, but I heard that it was back loaded at the end of the day, like within 5 minutes of the close.
That is not confirmed by me and may or may not be true, just what I had read.
Alex, I have wanted to get back in EXK and NGD…I can’t have both…which chart looks most promising?
There are reasons to like both – signs of strength and weaknesses in both.
6 of one, 1/2 dozen of the other to me at this point.
I own both 🙂 can’t go wrong. hard to decide.
Thanks for the opinion. I got back in NGD but my computer crashed and by the time I got back on the day had ended and it went up leaving my unfilled order behind. Poo.
look at NGD weekly. $3.5 is the line in the sand. https://uploads.disquscdn.com/images/2e94ea5f05aabd14cf683e035e145f64cff24110a6598982bae9b5fb8c4c151d.png
Thanks for the chart. When you say ‘line in the sand”, do you mean support,… or, if it drops lower dump it?
Also, I see you use EMA s whereas Alex uses SMAs…why?
Really reaching here F5
https://uploads.disquscdn.com/images/8d51f666cfbec073b0e7f5175f4d08f8f08e6c727299798a263f47b04ebe6a71.jpg
lol.. i saw that
Hey, it fits. Why not?
The special full Moon didn’t do what the forecasters said it would for Gold Monday..
Cycle timing is very late with Gold at day 30, I think we’ll see a low by day 33
Thanks Bill….. that’s a while ago I wrote you back.
I have heard this more…. do you read this “a Mayor Change in the trend” is this up or down in the PM and Oil.
Again… great to see you Bill.
Thanks for your response.
Gt.
Channeling Spitz?
AKG , GPL, KLDX & CDE – nice reversal there too. Watching th 10sma . A few others turning green too.
I was really hoping for a flurry of buying into the close, to put reversals in place.
I have to run for now, have a great night & weekend all!
So, Alex are you expecting a sell off below $1200 and not making any leaps today?
Dirty Sanchez SN looking a potential flyer…. if….. it can stay above the 200
F5
https://uploads.disquscdn.com/images/4f36f2e00a2855801f483ffee59ef469c55bd848aad460adbffb6f75e7ab5f2e.jpg
I still have that red, maybe it will make a run up and I can exit in the green. Nice chart.
Hi Alex,
I just noticed that precious metals futures expiration is on Monday after Thanksgiving – may be something else to add to your comment of next week being unusual due to shortened trading.
Have a good weekend, all!