NOV 15 -Light At The End Of The Tunnel

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Markets are running, but I’m sure that everyone wants to discuss the light at the end of the tunnel. We’ll do our market review and then on to the Precious Metals.

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SPX – I posted this Monday night, it looked like a pause in the strong move out of the ICL.  A possible Bull flag.

spx-11-14

SPX – Tuesday it broke upward and this is only day 7.  Bullish.

spx-day-6

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USD – Big picture, I’m watching 100.60 and 100.71.  The USD chart has looked and acted very bullishly since the summer.

usd-11-15

 

WTIC – We have a confirmed swing low ( strong gain of almost 6%) and a break above the 10sma. We’ll have to watch this in a couple of weeks. Even though this day was a huge move off of the lows, I have been expecting weakness, maybe in 2 weeks so. We’ll have to see how Wednesdays inventory affects things. I find it very interesting that…

wtic-11-15-a

 

XLE –  Oil may have struggled a bit, but the XLE certainly hasn’t. It is on day 9 and reaching for 2016 highs.  Interesting. Stocks like OAS, AREX, RICE, CPE , WPX, REI  ( CHECK OUT REI), all look quite bullish. If Oil is going to be weak, why are so many energy stocks acting correctly?

xle-11-15

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For our discussion on Gold I want to go back to the example of the Oil chart. Over a week ago, we saw a swing low form, and it went higher for 3 days.  I warned that it was unconfirmed.  Soon it started to waiver and failed at the 10sma. THIS is why I say if you are conservative, you may want to wait until price gets above the 10sma.  Oil dropped from there to new lows and if you had a tight stop, you got stopped out right at the lows.  That said…On to Gold.

wtic-11-15

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GOLD – Yesterday I posted this to show that we needed to get above 1230.90 for a swing low to be in place.

gold-11-14

GOLD – We barely have a swing low in place, but many Miners took off Tuesday. A low on day 26 is perfect, but  ‘COULD’ it drop like oil did, just to break the lows again?  Yes.   In my opinion, this late in the daily cycle , the downside is very limited.  I’ve been buying, but my style is to buy the lows. I am saying this because I do hear people say, I’m buying with a super tight stop.  A break of day 26 is possible & then a speedy recovery at this point in cycle timing. Think about that when thinking about stops. See the Oil chart again.

gold-11-15

Silver has not even put a swing low in place, but Silver stocks are ignoring Silvers lackluster performance.

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GDX – We have a swing low here, but unconfirmed.  I am going to tell you why I think it is safe to buy, even though GDX is still below the 10sma. This is why I have already been buying. For conservative traders, you can wait. An ICL has plenty of upside.

gdx-11-15

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  1. Day 26 on Golds daily cycle is late in the sell off, due for a low. A break down from here shouldn’t last.

  2.  We also saw capitulation last Thursday and Friday, further break down is less likely.

  3.  Look at the following Miners.  If we wait for GDX to cross the 10sma in a day or 2, we are not catching the lows in many miners.

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PAAS – Silver has no swing low in place, yet PAAS has taken back all of the Election sell off losses.  ( Yes, I know they released earnings Monday, See the link below).  PAAS may do very well.

PAAS EARNINGS REPORT

paas

 

MUX – Mux pretty much regained the losses from Thursday and Friday already, with Gold still at the lows.

mux-11-15

 

HL – Oct lows are way down there. Support at the 50sma has held.

hl-11-15

 

GPL – Silver is at the lows, GPL and others are breaking higher. read the chart.

gpl-11-15

AG – Ditto

ag-11-15

 

ASM – This was Monday, October lows were not broken.

asm-11-14

SO we see progress in the Precious metals, and I believe that we are seeing the lows form.  My expectation is that Gold,Silver, and Miners will move higher.  Many Miners are taking off or moving higher already.  I’ve explained the slight risk of Gold taking out its lows like Oil did, but these Miners are a buy, and I believe that any risk to the downside is minimal. Yesterdays report included some Miners that were already looking good, and todays includes some too.  We will examine other low risk buys in future reports as this market moves forward in what should be a recovery mode out of the ICL. 

 For the very conservative, do not worry.  If you wait for the safer buy of a confirmed swing low, gains should still be very good.  We should be coming out of an ICL , and the upside lasts for weeks, even months.  See the move out of the mid January lows or the May lows for an idea of what lies ahead in Miners.

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~ALEX

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This report was released on Tuesday night, but the email alert did not send. I am trying again Wednesday Morning at 7:15.  If you still do not receive the email alert Wednesday morning and want to report it, please contact ‘tech support’ under the support tab / contact us  (not Alex).  Thanks.

143 replies
  1. Aniket
    Aniket says:

    My fellow chart freaks 🙂 I did little due diligence on why NAK was surging lately. Please go through these stories.

    1) Myron Ebell will be a new EPA head

    Reference: https://www.washingtonpost.com/news/energy-environment/wp/2016/11/11/meet-the-man-trump-is-relying-on-to-unravel-obamas-environmental-legacy/

    2) Now please go through this old story. http://s3.amazonaws.com/atrfiles/files/files/060413-Pebble_Coalition(1).pdf

    Put 1 and 2 in perspective and you will be delighted. 🙂

    • chartfreak1
      chartfreak1 says:

      Hey Aniket – Thanks. I agree, Myron Ebell certainly may be a means of change in the EPA. Even before that, good news for NAK was in the works. Maybe many here missed it when I posted this in October, so I will re-post it with yours.

      I posted an article from Oct 29th ( When NAK had its first big surge on the news) , that was extremely positive for NAK. The EPA is no longer fighting NAK about permits, and this was the reason for the huge POP on Oct 29th

      They have agreed to litigation to resolve matters. See the Quote below :

      Northern Dynasty Minerals Ltd.nyse mkt:NAK) (“Northern Dynasty”)
      announces that its wholly-owned subsidiary,
      Alaska-based Pebble Limited Partnership
      and the US Environmental Protection Agency (“EPA”) have filed a joint
      Notice in federal court stating their intent to enter into mediation in
      an effort to resolve ongoing litigation under the Federal Advisory Committee Act (“FACA”).

      http://www.marketwatch.com/story/northern-dynastypebble-partnership-cap-legal-costs-to-conclude-litigation-with-us-epa-2016-09-29?siteid=bigcharts&dist=bigcharts

      • Aniket
        Aniket says:

        Yes sir :). I saw that article. Thank you so much for walking an extra mile as always. Exciting times ahead.

          • Cason
            Cason says:

            Wow, up again. Really dissapointing that I don’t have anymore, b/c I used to. Let us know if you see an opportunity to chase. This does not appear to be it.

    • chartfreak1
      chartfreak1 says:

      Hi Tammy,

      Just checking for my own information – you must have seen that the report was released on Twitter? I am getting reports that the email alert didn’t go out, and I am set up to receive the email alerts and I didn’t get one either.
      Thanks

  6. Tammie
    Tammie says:

    SINO! I didn’t buy it this morning because it was up some 30%…now up 100%….man!! You just never know with these…

  7. Tammie
    Tammie says:

    The shippers I’m looking at seem to all be taking a break …I got SB and it immediately starting going down some…hopefully just taking a breather before resuming….

    • ray
      ray says:

      Alex ,
      your thoughts on this giraffe neck ? – last time you went out pretty close to the top , you have the same strategy in view this time – or is it a buy and hold , picked up NAK recently before this big jump

      • chartfreak1
        chartfreak1 says:

        My trade is long term now. When I bought at 30-40 cents, I loaded up quite heavily due to the base and other factors indicating that it was ready to go higher. When we got the strong run higher, I lightened up to lock in gains, but kept a lot as core position ( The chart remained bullish). I added on the dip and am content to just hold.

        For traders : When they get extended in giraffe neck, they will eventually either drop back down to the 50sma, or go sideways and consolidate those gains. See TRX, NAK, XRA, THM, etc – they all extended upside and drifted back to normal as ICLs approach. So early in a possible ICL, I want to let this ride for now.

  9. dsaulw
    dsaulw says:

    Gold has roughly followed the price pattern for bonds over the past year, in terms of the timing of major highs and lows. The 10-year put in a new (slightly lower, basically a double-bottom) low today and will probably put in at least a temporary bottom pretty soon, if it has not already. Which is not to say that gold will necessarily put in a lower low (it hasn’t, thus far) but I think that it is worth watching.

  11. Cason
    Cason says:

    Alex, any thoughts on SA or HMY? They have been favorites here at Chot-freak in the past. But having a rougher time than others in the recent pullback. More room for the running or better elsewhere? Thanks!

    • chartfreak1
      chartfreak1 says:

      SA & HMY were noted here a lot in the spring. Very bullish set ups.

      Not too much since then. When they set up bullishly, I will probably mention them again, right now I haven’t looked at them much much, havent been interested in SA in almost 1/2 a year really. ( Though I bought HMY maybe a month ago? – got stopped out)

  12. Cason
    Cason says:

    Fed funds rate now showing 90% chance of dec rate hike. Factor that into your trading plans. Agree with Alex that we have proof longer term that gold can be fine (like maybe Jan – Mar 2016!) but initial reaction by the masses could be crazy at first.

  13. deshy
    deshy says:

    Alex,

    I realize they’re not always right but would love your thoughts on Druckenmiller, Soros and Gundlach all moving out of $GC in the last quarter. Wouldn’t you want these guys in to help move the investment in $GC??

    • chartfreak1
      chartfreak1 says:

      We sold last quarter too. We bought in January and started to lighten up in March /April.
      We bought in at the May ICL, and strted to lighten up 2-3 daily cycles later, but we always look to buy the dip.
      So I use cycles and I try to buy at ICLs and try to sell when we feel that a sell off is coming due.

      Are they out for good? They think Gold is re-entering a bear? or Did they just lock in profit and may be looking to start buying the dip?

      I do not know, I do not follow them.

      • deshy
        deshy says:

        Gundlach is looking to short GC. But your last comment “I do not follow them” is probably really good words of advice! Thx!

        • chartfreak1
          chartfreak1 says:

          Maybe he knows something that I do not. Trump election? I can’t be sure.

          If something has changed, I will know it after this ICL. Right now, the pullback has been within Bull market parameters. A drop early in the next ICycle would say that the bull is weakening

    • chartfreak1
      chartfreak1 says:

      Nice – and then dropped , yet Gold didn’t get sold off terribly on the USD rise.

      I have actually been kind of wondering if the USD will break to all new highs , above both of the prior highs that I pointed out, as a bull trap.

  21. Tammie
    Tammie says:

    MRPHF – another marijuana stock that wasn’t on my list – up 22% today – announcement related to purchasing a new facility as well as 3 medical marijuana licenses for manufacturing, cultivation, and retail use…

      • Tammie
        Tammie says:

        No….thanks, I’ll have to take a look! On some of these I figure….why not put a few hundred in..if it goes up to $1 then great (or even 50 cents!)….if not it’s not too big of a loss…I am trying to read about them though and see which ones look like they have the most potential for growth, which ones are positioned in the market already, etc….

        • chartfreak1
          chartfreak1 says:

          Yes, I had a list that was just way too long and hard to know which companies were being used for medical marijuana and could be poised for growth, and which were just flying higher in sympathy with others. It’s like owning some of the pharma or biotech stocks the way they move & the way they are loved & sold off.

          They should stabilize over time once the excitement dies down and the true winners develop.

      • Tammie
        Tammie says:

        So I looked this up…Ameritrade and cnbc had no articles at all on it…..so googled it…..found article on it where the CEO returned 90 million of his shares to the company treasury….basically saying it would benefit existing shareholders to not have as many shares outstanding…..it’s a provider of health insurance and related insurance solutions to the medical marijuana industry….they don’t cultivate, handle, transport, etc. any of the cannabis…

        • chartfreak1
          chartfreak1 says:

          That sounds very familiar, I read about many of these about a month ago, when the laws for legalization were starting to pass more quickly. CBIS, CANN & CNAB were starting to take off swiftly

          Thanks. ( And that was fast!)

        • Glmus
          Glmus says:

          Take a look at a monthly chart back to 2013. You can see where you might end up for a year if you overstay. 🙂

      • chartfreak1
        chartfreak1 says:

        Treehouse is a brewery near Bills location. He says that when he goes to buy a growler, they often have a line like the picture shows, and then they also often run out.

        That may explain why no kids are in the treehouse 🙂

        • ray
          ray says:

          that reminds me of one of our most famous beers from Belgium , named westvletteren ( which is actually a little town)
          the abts were making beer just to make some bucks to pay for their living – in the old days, my elder brother would drive down there ( about 120 miles from here) and just buy a car full of beer
          a number of years ago it was elected as the best beer in the world for that year ( think more than once even) it became so popular that they had lines full of people waiting it became worse people went back home without beer!!! so they have a systeem where people had to call to find out how many bottles they had made and if they could get 2 crates reserved for them to be picked up on a curtain day if not, they needed to call like 2 weeks later to see how many were made again and if they could get 2 crates ( 2 x 24 bottles) – so that beer became almost like an ounce of gold of value here
          funny one day my bookkeeper gave me a few bottles.- i asked him if they went to buy them. his answer was his brother was the bookkeeper of the abts so he gets his beers for free – however he doesn’t drink beer and so he’s not even interested to get some ( for free) the abts are refusing to make more as they just wants to make the quantity needed for their costs.

      • chartfreak1
        chartfreak1 says:

        I haven’t look into it in this case, but in the past I have definitely seen it enough. Big Money often speaks after the fact, they don’t usually announce their intentions ahead of time .

        To unload big positions, they need buyers when they are selling, and to fill their pockets, they need sellers to sell, when they are buying.

        “We sold last quarter” ( we just wont tell them that we’re buying this quarter until we are all in – then we announce it and the ‘crowd’ “funds” and “CNBC viewers” follow and pushes us up the hill).

          • R Byram
            R Byram says:

            they actually do a lot of not most of the big transactions in the dark pools so they can buy “at the market” without distorting the price. Once they are in then there may be some more open market buys along the way to support the price.

  27. Glmus
    Glmus says:

    Nancytheartist got my attention re NAK earlier and I sold half. Then Alex said he may have seen the head of the giraffe, so I sold the rest right after that. NAK is currently up .8% on the day with a daily doji. Thanks Nancy and Alex for getting my attention. I do not hold a dirt cheap position like Alex does.

    • nancytheartist
      nancytheartist says:

      I sold some of mine too, but I will look for another ride up later and sell more. I will probably hold some remainder in a core position as a lotto ticket because I like their story/property and if the arbitration goes well [in December I think] it would probably go up like this again knowing they will get permitting.

  28. Michael
    Michael says:

    Alex, how do you square your bullish view on gold/miners with the very long consolidation in the dollar? While the dollar looks overbought, it’s also pushing up against the consolidation’s upper resistance. Is the dollar going higher?

  29. Tammie
    Tammie says:

    So I started to get SINO this morning when it was $2 something, but it was quickly going up so decided not worth the risk…it closed up $5.78 or so…..ended at $8.15 or some such……wow. One.Day.I. Will.Land.One.Of.These.

    • Cason
      Cason says:

      32x avg daily volume! Wow! These moves are crazy but hard for me to invest with at least some understanding of what moves them fundamentally. Also, not in front of screen all day makes these a no-touch.

      • Tammie
        Tammie says:

        Yeah, I really can’t figure out what is driving such big moves…even with all the new infrastructure talk with Trump you’d still not think they would move quite like this….at least I wouldn’t think so….

        • Cason
          Cason says:

          Yeah, completely nuts and they seem to be moving now a bit later than when Trump rally started. Some have split so much (DRYS) that they are essentially penny stocks (though share price doesn’t immediately indicate that). Right now it’s hot money moving it.

  31. Crystal
    Crystal says:

    my SALT is now up over $6 and under normal circumstances, I would be pleased with that kind of move ($5 to $6) in a couple days. . But compared to the other shippers, it seems pathetic.. gosh it’s too easy to get greedy and spoiled….

  32. Cason
    Cason says:

    Come on gold, let’s do this!!!

    Huge dichotomy btw senior and junior gold miners, too. Very interesting. At least pullback was on much lighter volume today!

  33. Philipp
    Philipp says:

    Hi Alex, new subscriber and already coming up with a question:
    How do u think mining stocks will perform in a stock-negative environment (for example S & P selling off like 10%)?

    Thanks and keep up the excellent work!

      • Philipp
        Philipp says:

        different topic: u still fancy a crude oil short, intraday already up @ 47.230 (found myself a possible resistance @ around 47.5 where i might hop in.

        Thank you

        • chartfreak1
          chartfreak1 says:

          I actually never said to short Oil ( we are only on day 3 of the daily cycle)

          We just started a new daily cycle and I think it will roll over, but Oil cycles are long and it may not drop for a few days yet. When I said I thought that it would go to 48ish, that is an estimate and I’m watching things step by step.

          • chartfreak1
            chartfreak1 says:

            Yes, and I’ll mention again why.

            Oil just started a new daily cycle, and it is only on day 3. When Oil rolls over, it isn’t usually going to fall with a peak on day 3. It may bounce around and go sideways under the 50sma, it may even beak above it acting like it did in September. A short in September would have pretty much gone nowhere for weeks.
            I wasnt expecting Oil to drop in September, but the movement before the true direction could be similar.

            I would watch how it is playing out for a bit.

            Did you know a new report has been posted? I probably wont be checking back here again today 🙂

          • Philipp
            Philipp says:

            Yes, i already recognized the new report, great work and thanks again for your update on crude! Will check the new discussion thread for further updates. Cheers!

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