WHAT AM I SEEING HERE? THAT’S ODD.

This is a long report.  I wanted to discuss Gold & them Miners in detail in this report. I have mentioned that I am seeing various interesting things in that sector over the past few weeks,  so let’s just briefly review the general markets and go right into Precious Metals.

 

SPX – The actual lows were 6 days ago, and we do not even have a swing low in place yet.  I would say that a close above this trendline & the 10sma should signal a dcl occurred, and then one could go long with a stop below that 50sma.

 

 

 

You can click on this to make it larger, it is simply a copy of what I wrote in yesterdays report.   Under the chart of the SPX I stated that we wanted a close above both the 10sma and the trend line.  The nasdaq simply looked like a back test at that point,  and should close above the 50sm again to add bullishness.

 

NASDAQ – The NASDAQ did  (just barely) close above that 50sma & the 10sma and this is a good start. I cannot believe that we are still not dropping into a deeper ICL.  If this keeps up, it has me leaning even more toward a runaway blow off top.  For now, The NASDAQ  may still lose the 50sma and roll over,  so one must still keep an eye on a long position and be cautious until it gets moving a it higher.   If it does continue higher,  you can expect the buyers to step back in and we can all relax a bit more.

The TECH SECTOR has experienced some consistent selling though,  but if you look at  AMZN, FB, NVDA, etc.  I think you will be impressed.   Take a look when you get a chance.

 

Jumping right to Precious Metals.

 

GOLD – I was looking at Gold this weekend and seeing 2 possibilities in the cycle count.  Did we start a new Daily cycle at day 30 and we were on day 11?  Or was this a stretched daily cycle and we would be on day 41?  Gold lost the 200sma and it was looking like it could drop further,  into our ICL.  The selling in Gold for June has been fairly steady, $1300 to $1200ish.

 

GOLD dropped to a lower low , and then put in a reversal on Monday.   This EASES the parameters for a swing low if this was a stretched daily cycle, and I also have mentioned that the Miners are just not acting normal.  I am going to go into that deeper today, to prepare us for various possibilities.

 

As mentioned in the weekend report,  Gold has now been selling off for weeks, and it even sold off deeper than the May lows. I would normally still expect even deeper selling for an ICL, but could this be enough? I know that many were telling me that Gold was acting too strong and would not break the May lows, but we do now already have a deeper low than many expected, and bullish sentiment is fading.

** I want to address the idea that this could be an ICL sell off this by looking at the Miners.

 

GDX – We are still dealing with a triangle formation,  and I have repeatedly stated that in my experience,  Triangles throw off cycle counts and expectations.  Instead of a sharp steep slam, you get a long, slow, boring, exhausting, lack luster sideways move.  This wears people out too.  A quick slam CAN still happen, sort of a false break down & recovery, but let’s discuss Miners further…

GDX – GDX had a strong reversal Monday. I’m not worried whether this is day 13 or day 45, because if a swing forms, a 32 day daily cycle works, and a shorter 13 day can have occurred too.  I have seen 13 day daily cycles in the Gold Bull of the past.   (Sidenote: GDX did not break the May lows ).

 

Here is the ongoing perplexing part

 

As mentioned in prior reports and in the weekend report, Some Miners are looking sluggish and still at the lows, maybe even below the May &  December lows!  Other Miners are looking Bullish.  That presents a VERY MIXED PICTURE.  What does it mean?  What could it mean?  We should look at a few examples.

 

GG – A big component of GDX is actually below the May lows and at the Dec ICL level, and made new 7 month low on Monday!   ABX & NEM are at May lows.  So note:   GG is  at Dec ICL price levels, 7 month lows.

RGLD – Royal Gold is remaining near the highs, even with GOLD selling off for the last 5 weeks.

RGLD –  Again, Gold just sold off in all of June from $1300 to $1200, and RGLD is holding up. This is a bullish chart with Gold breaking May lows.

 

SAND–  Yes,  I know RGLD is a royalty company,  but so is SAND.  SAND crashed down to the Dec ICL level in May & June, but notice that as GOLD dropped from $1300 to $1200 in June,  SAND has made higher lows.   HMMMM, THAT is interesting,  isn’t it?  It makes me ask, what am I seeing here?

 

BTG – Again, we now have Gold selling off, breaking below the May lows,  into what is supposed to be an ICL type sell off, and BTG looks like it put in an ICL in May, doesn’t it?  BTG started to sell down over the last 2 weeks, but Monday it reversed strongly.   It makes me ask, what am I seeing here?  A break back above that trend line is bullish.  Gold sold off throughout June and this chart looks Bullish.  Inverse H&S?

EXK –  Ok, back to the weakness.   EXK went below May lows and December lows, but this pattern looks bullish and gives the appearance that selling is drying up ( Wedge pattern). Look at that MACD. Silver crashed in June & July,  EXK held the lows.

 

SO I zoomed back and EXK actually has only pulled back 61.8% of the total run higher.  If EXK runs back to the 2016 highs,  that is a 100% move.

 

DID I MISS IT??    A few Miners moved higher by 4-6% and I get that same old question, 

“Did we just miss the move?”    NO!  “The Move” that we are looking forward to will run for weeks & months,  it is not a 1 day event.  Take look at MUX for example…

 

MUX had a great POP on Monday, but haven’t we  seen these a lot lately? Yes, and even so, Mux was still at 7 month  lows Monday morning.  I will say this however…

 

MUX – This chart is basing out & boring people to death, but it looks like it will run very nicely when it finally does break higher.   Does this chart look like we missed the move 🙂  This stock could run up 100% when the real move starts.

Let me show you what SILVER did over the past Month.  I do worry about the Silver spike low getting ‘tested’ in the future, they often do, but Miners seem to be putting their lows in already. EXK did not follow this crash, and neither did AG, CDE, FSM, GPL etc.

GPL –  What did GPL do while SILVER crashed down?  GPL has formed a base and is really still inside of that base, but we also see a wedge that it broke out of and back tested.  What am I seeing here?  I am looking at this like that baby chick in the theme pic is looking at that other chick. What? I am seeing a silver stock that has held these lows solidly since early May, while Silver was slammed down & flash crashed? So I actually bought this on Monday.  My stop will be under recent lows.

 

AG – What am I seeing here? Sure, each bounce has been short lived, but the same lows seem to hold each time.  Please read the chart. This looks like a low risk buy, since your stop is at the recent lows.

 

NG – Nova Gold was 6% higher today. It has made a higher low with Gold selling off last week.  Nova Gold actually went higher in June while Gold was selling off.   What am I seeing here? The selling in the Precious Metals is no longer affecting some of these Miners.

 

NG WEEKLY  – This is is a giant wedge  or triangle too,  with divergence in the MACD.

 

NG WEEKLY – This could break out if GOLD & SILVER are putting in an ICL now.

NG WEEKLY –  This could bounce and drop to the same low one more time if the ICL is not in place.

 

SAND – SO Sand was very weak, and it dropped to Dec lows and below in May. NOW – when Gold & Silver are selling off, it decides to put in higher lows?  I feel like that little chicken in the theme pic looking at the other one.  What am I seeing here?  Miners usually sell off twice as fast as Gold & Silver, don’t they?  They do,  but not when triangles are involved.  SAND is acting like it has put in its lows.

GORO – I traded Goro & GSV out of the May lows and sold  it expecting it to follow Gold as it dropped into an ICL.  GORO  did not Dropped while Gold sold off in June , did it?  Read the chart.

 

VGZ WEEKLY – VGX ran from 20 cents to $2.00 and has consolidated those gains for months now.  Now oversold and with other Miners moving higher, this might be a double bottom.  It needs more time, but it is on my watch list.

SO in summary, what does this mean? Well, I have covered a good number of Miners here, but obviously I could not show you them all. Some Miners look like they bottomed in May, and have been making higher lows while GOLD & SILVER sold off over the past 5 weeks and Silver plunged as shown below.

We have seen Gold & Silver selling off to their recent lows.  I would have expected Gold to sell of further  ( and it may) , but it is similar to the ICL last May 2016.  Is an ICL here yet?  It is too early to say for sure, but Miners are not getting trashed.

SIlver has big volume and almost returned to the 2015 ICL lows in that flash crash.   IT is also in a large triangle.  Can you see 2 other flash crashes on this chart?

So we have seen some Miners that appear to have bottomed in May, now making higher lows.  Look again at the charts of BTG, NG, GORO, SAND, etc. , they are NOT selling off with Gold last couple of weeks.   Then we did see some Miners still at their lows like  GG, ABX, NEM, and other Juniors forming bases like  GPL, EXK, AG, CDE, etc.   They also did NOT sell off with Gold & Silver last week.   Since that is what I am seeing here,  I would have to say that it may not hurt to hold a Miner or Two, if they do appear to have put in their lows.   I do remain cautious, since this did not look as much like an ICL sell off in Gold as many in the past, but we could form a low here, and I do see some Miners making higher lows since May.    Like I said in the weekend report, I am NOT shorting Precious Metals or Miners, and this is why.  I am actually looking at some of these Miners and seeing them resisting the selling of the past Month in Gold & Silver,  setting up as Long candidates.  Along with some Miners perking up…

 

 

AND OTHER ‘STUFF’

 

I mentioned STEEL & ALUMINUM Looking Bullish a few weeks ago, and the commodity stocks looked to be in a “bottoming Process”. Those lows are still in place and Monday I pointed out in the comments / chat section by 10 a.m.  that I thought I was seeing something lining up in CLD & CLF and a few others.  I also pointed another area out, so let’s discuss these.

 

POT, AGU, MOS are fertilizer potash stocks and they have been bottoming.  Since they have formed multi week bases, I think that these are low risk buys with a stop under recent lows. They started breaking out yesterday,

-this was POT after Noon time on Monday and it did close above that 200sma.

 

SO I immediately pointed out IPI, which I had mentioned in a recent report as one that I bought recently ( Thanks Crystal & Chuck for reminding me of this one in the past). This was IPI after noon yesterday and it looks to be breaking out too, so I added to my current position.  After this consolidation, it can move higher.

 

In the comments section at 10 a.m.  I saw CLD up 3+%, but it had strength coming in on the 5 & 15 minute charts and other internal factors made it bullish, so I mentioned that CLD & CLF looked good.  The daily has them going sideways above their 50sma,  forming higher lows.  This was a buy with a stop below the 50sma. It closed up over 9%, but it can work its way higher with this bullish set up.

 

CLF –  And CLF did close up 5% also, and could keep going.  It could be bought here & may break out & run higher , but it also MIGHT stall at the 200sma and bounce around between the 50 & 200 for a bit building steam to break through.  It is worth a try, in my opinion in case it breaks right through that 200sma.

HBM–  You can see that  HBM has the similar struggle as CLF here, but it is holding above that 50sma too.  The sector seems to have put in their lows,  so this might be a decent buy area, with a stop under the 50sma.  OR wait for a break out above the 200sma.   HBM is actually a pretty bullish set up in the longer time frame if this sector has bottomed  ( This is mostly copper).

 

X –  I have been pointing out X, STLD, SCHN, AKS, etc  for a while. X  has a rather slow bottoming process that has been a bit frustrating if you bought and held when I first mentioned it, but it got through the 50sma and back tested it so far..

TGB –  I own this and have mentioned the inverse h&S patterns lately.  With most of the commodities higher yesterday,  it dropped 6 cents.  That alone is Not a big deal, but obviously I’d like to see it run from here, rather than threaten to drop & test that blue trend line again. I’m hoping that it just moves higher from here.

 

UEC –  I also own UEC from a while ago when I discussed URA shaping up & possibly bottoming.  This one does not break out & run day after day yet.  It pops and drops and pops and drops and bores the investors  🙂    See also  URG, DNN, UUUU, URRE.

UEC WEEKLY

UUUU – If the Uranium Sector looks to be bottoming  ( And I pointed out URA in a report last week), then this could be bought here with a stop under recent lows.

URRE – Uranium &  Lithium,  this also popped a bit, up 5% yesterday.

 

SO we see the Commodity sector bottoming and set ups in this area are finding follow through,  though they are a bit slow and boring at times.  The Miners seem to be more in sync with these sectors, somewhat ignoring the June sell off in GOLD.   The COT was mentioned in the weekend report too.  Smart money have been closing their short positions during this Gold sell off from $1300 to $1200 – Miners may be in the accumulation stages.  This report was designed to show you that with out steep selling in GOLD & SILVER, we see some Miners appear to have bottomed in MAY and are NOT getting caught up in the selling.

Based on my trading style & experience, individual Miners may be bought with a reasonable stop if they exhibit signs of bottoming, but I will NOT be using leverage here yet. Why not?   GDX & GDXJ  (  GG, NEM, ABX) are following GOLD & SILVER a bit closer than some individual Miners and remain a bit more risky and uncertain at this point.   When we know we have an ICL in place, my trading style may become a bit more aggressive.

So we have a lot of bullish looking activity & set ups appearing now,  after enduring the recent choppiness.  Stocks began selling off and bouncing back in a choppy manner over the last several weeks, and bottoms have been forming.   Enjoy your trading for Tuesday!

 

~ALEX

 

FSM did not slam down when Silver sold off and flash crashed either.  The lows seem to be in place in May.

 

MY ADVICE WOULD BE TO MAYBE START A SMALLER POSITION OR TWO  WITH MINERS  THAT LOOK TO BE AT LOWS  OR MAKING HIGHER LOWS DURING GOLDS SELL OFF ( OR WHATEVER YOU ARE COMFORTABLE WITH)  AND JUST ADD IF WE GET FOLLOW THROUGH.  USE STOPS IN CASE WE GET A FINAL FLUSH .   IF GOLD PULLS BACK LIKE WE ARE SEEING IN PRE-MARKET, WE MAY GET A LIGHT PULL BACK IN MINERS GIVING US THAT OPPORTUNITY AT LOWER PRICES.