Friday June 2 Jobs report

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Today is the final trading day of the week, so let’s do a quick review…

 

 

SPX –  In the weekend report, I warned against ‘shorting’ the General markets .  Surprises are still coming to the upside.

 

 

WTIC – May 30 I pointed out that OIL cannot get back above the 10sma. Notice in March that OIL never got back above that 10sma.  In April we see the same thing.  This is one area that I am watching going forward.

 

WTIC – I was short Oil and looking at it this way basically. The 50sma and the 200sma should be solid  resistance overhead. Oil peaked on day 15 in April and dropped to a day 31 low. This daily cycle has peaked on day 14 so far, it could continue to drop for days too.  I saw a bounce coming on the short term charts, and that bounce occurred Thursday intraday, so is it finished?  I’ll discuss that in a minute, but notice that Oil went sideways in April for a week and then continued to drop.

 

CAN OIL BOUNCE? – XLE and several Energy stocks looked to have reversal candles yesterday, are they pointing to an Oil bounce?  One day reversals can fade quickly and these bounces in the XLE have been short lived recently, only tagging the 50sma.    Yesterday I was looking at what I considered leaders in prior reports RES, ERF, AREX  for clues, and they may have bottomed already.  I say this because they held up at the 50sma, but I am not taking OIL/ENERGY long trades yet. OIL is below the 10, 50, and 200sma and has not stopped dropping at this point.

WTIC –  SO if OIL was about to bounce, this wedge pattern could play out with a drop today to  $47ish and then a break higher. MAYBE that is what the energy stocks are signaling, but again, this could be just a short term bounce to the 50sma by XLE again.  Can Oil get back above $50?  I would like to see what Oil does at the 200 & 50sma resistance near $50 if does Oil bounce short term.  It did go sideways for a week in April and then continued to drop.

NATGAS – Still breaking down.  NATGAS broke below the 50sma Tuesday and the 200sma the next day.  Thursday was follow through and volume was heavy.

 

GOLD – Does anyone remember when I drew GOLD on MAY 19 and showed that Gold has been strong & COULD CLIMB ALONG THE MAGENTA LINE for a bit?  See the BLUE ARROW

 

GOLD has climbed along that line.  I expected Gold to top around day 11 Left Translated, so far it topped on 14. It closed slightly lower on Thursday and could form a swing high if it drops below 1263.70 on Friday.

 

As Gold has climbed higher along that trend line, Miners have drifted lower. I simply drew in a Red line to show that Miners could POP & DROP,  but I have mainly been expecting the weakness to continue.  The Blue lines show a likely path. I am short Miners, but the bigger better opportunity lies ahead when we flip to LONG.  Patiently waiting for a real move higher will pay off.

Again, it is Friday, the final trading day of the week. We have a jobs report this morning that could move markets, and maybe it will even start Gold into the expected pullback. I want to give a friendly reminder that ‘over trading’ can needlessly chop up ones account.  I am expecting one of the best trading opportunities of the year soon, and I really want everyone to be able to fully take advantage of that set up.  If you are an active trader and find yourself getting a bit chopped up recently, take a break or keep position size small.  Protect funds for the upcoming opportunity.

 I am an active trader for a living, so I  took some ‘short’  positions in OIL, NATGAS, and MINERS recently and long a biotech company, because that is what my analysis has handed me, but those types of trades are a bit riskier and may not be right for everyone.  I try not to over advertise them, because I do not recommend them for all of my readers.   What I do recommend is to make sure that you have funds on hand when the Rally in Miners starts. I will strongly be recommending that everyone go long at that time, and I will be pointing out low risk set ups ready to pop higher along the way. I honestly find that the best trading in my account is at an ICL in precious metals, and usually they come only 2 times per year.   The rally lasts for weeks and even Months, and we have actually made real gains of 50%, 100%, even  500% on some trades in 2016. It is worth being patient and saving funds for that upcoming opportunity.

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Enjoy your Friday and your weekend!  Thanks for being here at Chartfreak.

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~ALEX

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JBL Trade set up following through

119 replies
  1. Bill
    Bill says:

    Happy Friday all! Us Dollar is basing and getting ready to move higher. USD low probably in. Short miners here. Oil continued lower overnight. It will be interesting to see if the energy sector moves lower to follow OIL.

  4. J Lo
    J Lo says:

    Alex, today’s new high in gold places day 17 as a potential high. Is that too late in the cycle for this cycle to be a lefty?

    • chartfreak1
      chartfreak1 says:

      It is not ‘too late’, but it is very uncommon. Definitely not ideal, many daily cycles do end on day 28-33 lately.
      The last daily cycle in Gold ran for 41 days , so even a day 20 peak
      would be L.T. in that case, but it is really odd to see such strength in
      GOLD and not see MINERS responding the same way ( or leading the way). https://uploads.disquscdn.com/images/4d2a963c08b77e6f10175f52c95752c021be2f6b83f5e34ef06e5ee73c069d94.jpg

      When I look at a daily chart of Gold, it looks bullish because it looked like a bull flag and a running correction, they both usually have follow through. Then I look at GDX or GDXJ and I do not see Miners following Gold higher or leading the way like they should be.

      refresh

        • Cason
          Cason says:

          SOG, what’s the number for the 65? Yes, last 2 times we had a later in the cycle push. If GDXJ/JNUG was going to do that, today would be a great day for it!

          • SonOfGud
            SonOfGud says:

            65ema & brown 65ema env channel numbers (ignore the grey channels)……

            top of chn = 19.98
            65ema = 19.10
            bott of chn = 18.22

          • Cason
            Cason says:

            We hit that top and I’ll be yelling “You sunk my Battleship” over JDST!!

            Hey, can you get URRE going again or what?

          • SonOfGud
            SonOfGud says:

            i sold out of JDST for breakeven today.. not sure which way this is gonna go for next few sessions, and i dont wanna take a potential -20% hit just holding the damn thing till it drops.

            URRE unsure if its done a full 5 waves down for its final Cwave.. looks promising, but you know she plays hard-to-get

          • Cason
            Cason says:

            I’m still in and still up 5%, so unless it really blasts off here, I’m comfortable. Started small and am just leaking in. In fact, been rooting for GDXJ to go higher so I can get a sale on my next purchase.

            Still with CF, want to go after the next long. Before CF, I used to get caught in some of these ICL selloffs. I’m not doing that again. So if I can make a few bucks waiting then flip long I’ll do it. Can’t fight the market, but am trying to take what it’s giving me. 😛

      • Cason
        Cason says:

        Was this the next chance to add to DUST/JDST? Shorting gold is really tough, it just keeps powering higher and higher but anyone long miners HAS to be disappointed this morning!

  6. Cason
    Cason says:

    Whoah!! Jobs report huge disappointment!! How did ADP get it so wrong. But the unemployment level continues to drop.

    • Kenny
      Kenny says:

      I sold mine in pre-market…it was up and I did not feel like gambling on the jobs numbers. Doing what you have driving into our head…patients and preserve capital.

    • chartfreak1
      chartfreak1 says:

      Yes, $17.46 was the peak for Silver 2 days ago, and Silver is still below that.

      Crazy markets these days- tricky lack of correlations and so on. 🙂

      • Rob
        Rob says:

        I hear ya. Things seem out of sync. I am short miners here – nothing too drastic though. If the trend line breaks (miners close above), I will exit my short. Good chart and reminder.

      • Maria
        Maria says:

        luckily for us .. u have a head like a rock .. oops i mean … wont be swayed by noise…
        MEOW

  9. dsaulw
    dsaulw says:

    I am wondering if miners are simply “out of favor” while stocks remain strong and if it will take a healthy correction in stocks for miners to return to life.

  10. Ken
    Ken says:

    Nat. Gas is tempting me……
    I wish there was a very good Nat. Gas Jr. stock to play it though….. UNG Calls seems to be the play other than a 3x etf.

  11. Ken
    Ken says:

    Gold (GLD) above the 50 and 200 sma….tracking Bonds very well.
    Bonds (TLT) above the 50 and 200 sma….tracking Gold very well.
    Yen (XLY) above the 50 but below the 200 sma.
    Just something to consider……

        • bounce
          bounce says:

          NAK is a screaming buy under 500mil market cap IMO. Closer we get to third quarter the more buying pressure (stock price & partner coming in to play).

      • Cason
        Cason says:

        NAK and MACK, our twin rhyming losers. I have faith in NAK, man. So I’m watching but planning to hold.

  14. Ken
    Ken says:

    I was thinking that the decision to leave the Paris Accord would lift Energy…..nope new low on XLE…..I will be looking to add my second tranche soon.

    • Cason
      Cason says:

      To be honest, I had no idea what the reaction would be. They can be very hard to gauge sometimes on one’s like that (vs economic news where we kinda understand the impact).

    • Edward Bernhart
      Edward Bernhart says:

      A week ago Monday in the budget proposal there was news to sell half (270 million barrels) of the strategic oil reserves in order to generate income, modernize facilities, and more currently reflect our current needs given the discovery of new fields and techniques to sustain our needs (more self-reliance). While these barrels would be released over 10 years and would not begin until next year, we may surmize that there would not be an immediate effect on crude, although the US sold 10 million barrels in late Feb. http://www.zerohedge.com/news/2017-02-08/ , there would be a downstream effect on the developers. Interestingly enough this announcement came at the same time that the Saudis were buying armaments and trying to cut production. http://www.rigzone.com/news/oil_gas/a/150279/trump_proposes_selling_off_half_us_strategic_oil_reserve

  16. Edward Bernhart
    Edward Bernhart says:

    Alex, We just hit 32.00 in GDXJ, what does that do to our shout position? Did you want it to close above 32.00 to be valid? Thanks.

  18. Ken
    Ken says:

    Deutsche Bank trader by admitting guilt states under oath that the biggest Banks in the world have conspired to RIG precious metals markets illegally. Well there is a surprise !!!! 😉
    Maybe just maybe there will be a free market in PM,s now……not holding my breath or anything.

  19. Ann
    Ann says:

    Now that we all got stopped out shorting miners…it’s looks like it might have faked us out!

  22. Cason
    Cason says:

    Oil fought back but where is energy? With markets at another another all time high.

    How about bio-tech? Huge late week comeback for LABU/IBB (no position since stopping out earlier. Drat!! I would have had a nice win if had held on, oh well. Discipline!).

  23. chartfreak1
    chartfreak1 says:

    I had an appointment to meet up with one of our readers that was in the area, So I closed out my shorts on Miners as Gold surged higher and GDX / GDXJ traveled back up toward the highs of the day.

    Now I’m back and JDST is close to where I sold it. Gold is running higher , but Miners are just not buying it. I may try that short again, I just couldn’t take any chances while I was away from the screen and GDXJ was rising back up .

    Miners really do look unable to break out, even with Gold taking off, and I see RED miners in my watchlist.

    GG, AU, FSM , RIC, etc. Just down pennies, but with Gold surging, Miners are not leading or buying this move.

    TOUGH TOUGH SECTOR when Gold has all R.T. Daily cycles so far, and Miners peaked in February & got stuck under theirs major moving averages !!

  24. Steve Tytler
    Steve Tytler says:

    A Deutsche Bank Trader admits to using “phantom trades” to rig the PM market:

    http://www.zerohedge.com/news/2017-06-02/deutsche-bank-admits-guilt-fraud-conspiracy-rig-precious-metals-markets

    That is the futures market, but I think the same thing goes on in the equities market. Maybe there really is something to those long tail “signal candles” as I call them. https://uploads.disquscdn.com/images/c0f7487c1efeae45c66236a4def50fcae9df4597fa8130412bdb6d786ec08a3a.gif

    I’ve been sitting in TQQQ enjoying the ride. Seems like “everyone” is predicting a stock market crash at any time … so when “everyone” is expecting something to happen, it usually doesn’t happen. I will stay heavy in TQQQ as long as my signals remain bullish. Interesting that TQQQ has been MUCH stronger then UPRO or UDOW over the past couple of months. They have been trading sideways while TQQQ is up 20%.

    Good Trading to All!

      • Steve Tytler
        Steve Tytler says:

        The PM market is MUCH easier to manipulate than the general stock markets because PM’s are a tiny fraction of the overall trading.

  25. chartfreak1
    chartfreak1 says:

    Wow, I think it was ECYT that was supposed to present its results from clinical trial today ( Similar to CYTR).
    They discussed theirs pre-market.

    Yikes.

      • Cason
        Cason says:

        I know! Looks good today! Frustrated that I was in LABU too early so I got stopped out Tuesday. In classic fashion sold just about the lows and then it took off upside without me. Market loves to do that, doesn’t it?

        Someone earlier this week (maybe Wed or maybe yesterday?) was asking about shorting bios. In case this was just a bounce maybe a short entry would appear. Personally, I don’t think that I would short here. Yeah, it usually settles a bit after a big move, but markets and NAZ are strong and this was a solid move. I’m on the sidelines myself.

  28. chartfreak1
    chartfreak1 says:

    I just wanted to re-post this chart. This is still possible, and this is part of why I sold my short position when I had to leave this morning. I could picture holding leverage and seeing GDXJ tagging that line ( & Still remaining L.T.), but as the day goes on,
    it remains weak with Gold up $12.

    This check is just a reminder, it was in a prior report. Tough sector in the middle of this daily cycle.
    Have a great weekend All…

    https://uploads.disquscdn.com/images/46430dbfebdc2d241fa782926526272c43ef422c3ae655189d42907040ec62b8.jpg

    • Cason
      Cason says:

      CF, interesting that GDXJ is now up and about to close right about the day’s highs but that GDX really isn’t anywhere near the midday highs?

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