Friday August 10

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IT’S FRIDAY, THE LAST TRADING DAY OF THE WEEK. LETS DISCUSS WHAT IS HAPPENING IN OUR MARKETS CURRENTLY, ESPECIALLY WITH THE PRECIOUS METALS, AND THEN I WILL DISCUSS THEM IN DEPTH IN THE WEEKEND REPORT …

 

 

SPX– I pointed out this  Bearish Rising Wedge a few times recently.  We were overdue for a drop ‘timing’ wise ( DCL / ICL), but I mentioned that the markets could go a bit higher first.  Be cautious.

NASDAQ Weakness was evident on JULY 27th in that NASDAQ slam down.

JULY 28 – I saw people BUYING THE DIP  ( this reversal)  in the comments section, so I pointed out that this reversal is possibly just like prior reversals after a slam down, due to the cycle ‘timing’. It could be a  fake reversal..  See the Magenta box – I mentioned that the NASDAQ may just trade weakly in there, choppy and unprofitable.

NASDAQ WEDNESDAY-  We have gone sideways, yet some were buying this reversal too, so here I was trying to point out that prior sell offs and reversals constantly failed. The ‘Timing” was not right, and the timing for the NASDAQ & SPX  was due to drop into a DCL.

 

NASDAQ –  And so we have our continuation drop, and we sliced through the 50sma. Searching for a dcl ( and possibly an ICL) , let this play out.   Look at charts of GOOG, AMZN, NVDA.  These were the leaders and they are breaking down too.

 

WTIC –  DAY 35 , so Oil is within the timing for a dcl to be sought out.  Thursdays reversal had some big volume too. We did see something similar on day 9 & day 28, but this time we are within the timing for a continuation drop into a dcl, so this may keep going.  I’ll start by watching the 50sma and trend line area for support ( I am not short or long).

 

XLE – Well, The XLE finally broke out & now we have a back test, but many Energy stocks are still a mix of good and bad after earnings.  The sector as a whole just does not look great yet, so I would be cautious since this might break down  🙁  IT also may just slowly climb down this trend line and form a ‘double bottom’.

 

USD–  As GOLD moves higher, the USD is holding up. I will discuss this more in the weekend report.

 

THE FOLLOWING 3 CHARTS AND COMMENTARY WERE IN YESTERDAYS REPORT.  LET’S START THERE, THEY REMAIN VALID.

 

GOLD – This was my original thought.  I did say that we could get a possible day 25 peak out of the ICL, then a drop to the dcl, back testing the 50sma. This still could be happening, and prior daily cycles have had 2 legs higher, but…

GOLD –  If that was a mild day 21 dcl at the 50sma and Gold is moving strongly out of an ICL,  it could just take off and pull miners out of that triangle into a  Wave 3 move higher 🙂.    Thursday would only be day 2, so it is hard to call it a dcl with conviction yet, we need further confirmation.

GDX –  I wanted to point out that  “IF THAT WAS A DCL, you have NOT missed the coming strong move, since  this has not broken out yet, but it should sooner or later”.

GOLD WEEKLY AUGUST 10th – Gold continued higher yesterday, and this is the weekly view.  It looks like a very bullish chart,  4 of 5 weeks higher out of the ICL.

GOLD WEEKLY AUG 10 –  We have 1 more trading day to the week and Gold has started to peak out from this downtrend.  If Gold Moves higher or is green at the end of the day Friday,  this weekly chart becomes more encouraging.   IF Gold drops today and closes lower? This break out could be invalidated or weak and next week will reveal a lot.   Step – by – Step.

GDX broke above the 200 MA on a weekly basis Thursday.  If GDX closes green on Friday, this looks to be breaking out ( The trend line should be next).  If  GDX drops on Friday, we could have what we had on the first week of April.

 

GDXJ WEEKLY – GDXJ has actually broken through a few downtrend lines, but it was not ‘time’ for it to run higher yet. Sideways consolidations can build up a lot of energy.

So some Miners during this earning season are looking very bullish  ( see NEM, PAAS and SSRM) , but take a look at others  and they are looking horrible ( see PPP & NSU yesterday).   I have seen this in the past, and they may be capitulating into final lows, similar to the  lows in 2016 when almost everyone gave up on Miners and said that they could NOT be profitable with high Oil prices, low Gold prices, etc etc .  They then ran up 100s of %.   I love the way things are shaping up, and in future reports, I am going to discuss the set ups further and give my expectations.  For now,  it is  Friday and today will tell us quite a bit too.  Enjoy your last day of trading and your weekend!  Thanks for being here at Chartfreak, I believe that we are going to make some exceptional money in the 2nd half of 2017 🙂

 

 

~ALEX

 

EXAMPLES: 

I want readers here to see what we have in front of us in the bigger picture.  I have some readers that just cannot pull the trigger on a trade unless they are absolutely convinced that things are lining up bullishly.  THAT IS NOT A BAD THING, PATIENCE IS REWARDING IN THE LONG RUN. When the precious metals sector begins moving upward with conviction, I will be convincing everybody here that they need to be in, and I will be pointing out set up after set up with lower risk entries.  Right now it is bottoming and we are inside of a choppy triangle, so some Miners are good , some are bad, and we have a mixed signal.   Let me quickly show you something encouraging here…

 

HMY –  HMY sold off relentlessly in 2015, but once it broke above the 10 weekly MA, look at what it was able to do.  That is 800% gains in 6 months.  By the way, DRD  is trying to break above the 10ma.  My point is to the ones patiently waiting to pull the trigger.  HMY Bottomed in November 2015, but even if you waited for a month or 2 before buying, you doubled and tripled your money.

 

VGZ –  VGZ sold off Sharply this week, from 83 cents to 63 cents!  Did you notice what it did on Tuesday, Wednesday, and Thursday? If this runs to former highs and forms a cup, the gains are going to be excellent.  My Point?  Even ugly crashing Miners can recovery rapidly when the time is right .

DRD-  I have been pointing out this pattern for a while.  This time I want to focus on 2015 too. It bottomed and went sideways in a frustrating manner for 6 months!  Once it broke key resistance, it also ran up 800% from the lows.   You are not missing all of the action if you are not buying right at the lows.  True,  800% was from buying at THE LOWS, and buying after it broke the 50ma comfortably  ( let’s say $1.50 – $2.00) only gave you 400+% – but I would gladly take 400% in a strong bull move higher right now.

AG –  Ag looks like it may be trying to recover now too.   AG was a fan favorite in 2016.  Many loved this Silver Miner, but with that sharp drop from the top, and then a recent break,  people are saying, “Miners are too risky and even some of the good ones are being thrown out.”    Well for the patient ones, a recovery of this break down would be a possible ‘shake out’.  IF you wait and buy this at $8, will you be sad when it trades at $24?  Sure,  $6 to $24 is over 300%, but $8 – $24 and 200% plus in your account is a great feeling too, right?

Bottoming processes are frustrating , tricky, yet they can be rewarding if they lead you into a bull market.  Not all Miners run at the same time, and we are seeing NEM, RGLD, and a few others leading,  SSRM and PAAS broke out sharply yesterday,  and going forward I will be pointing out trade after trade that can lead to great profits.

SSRM broke out with earnings Thursday, and this is now a safer Miner in my opinion.

For now, I have been  trying to avoid entering during the earnings season, so I have not been showing a whole host of ‘set ups’, but if things continue the way that I am seeing things line up in this sector, the 2nd half of 2017 will be excellent for our accounts.

122 replies
  3. Steve Tytler
    Steve Tytler says:

    Looks like a pullback in miners this morning, I added some more NUGT in the pre-market but could see a bigger drop after the open. I’m bullish on miners unless there is a major collapse today.

      • Steve Tytler
        Steve Tytler says:

        Ah, good question. For me (being a PM chicken) a drop much below Wednesday’s low would negate the bullish case short-term. That’s where I have my stops. I realize that is NOT a “major collapse” for most traders, but I don’t like riding out draw downs. I would rather stop out quickly and look for a better buying opp later.

        • chartfreak1
          chartfreak1 says:

          Thx Steve – I wasn’t sure of you were meaning major collapse on your 15 minute ( Which wouldn’t affect me at all)) or are you switching to daily.

          • Steve Tytler
            Steve Tytler says:

            Alex, I just use my 15 min chart for entries, of which I did a poor job of today. I broke my “rule” of never buying before 8:30 AM PT (11:30 AM ET) If I had waited longer I could have gotten a better entry price. I use daily and longer charts to decide whether to stay long. My stops (3 levels) are fairly tight, hopefully not TOO tight, because I’m always nervous being long miners.

          • Cal Staggers
            Cal Staggers says:

            Hi Steve,
            I recall your saying that you use the 9EMA crossing the 10 SMA on shorter time frames (5min, 15min) to help time your entries when you want to go long.

            Do you pay attention to MACD? I find that when it crosses below its average on the 15min and especially 15min AND 1hour, that it pays to be very caution if playing the long side.

            If you care to see what I’m talking about, here’s a picture – 15min NUGT (forgive me if I don’t respond to any comment for awhile, I’m headed out for a bit)

            https://uploads.disquscdn.com/images/0cba82afd7f566ee08a4595a53f8d5af3f2a9b21dcde04a21548661af993c980.png

  4. mike murphy
    mike murphy says:

    after waiting so long, seems so anti-climatic, I have a hard time getting excited and modifying my positions. It is fascinating how human psychology is reflected in the market moves. put a few bids in, but eh, waiting to watch the rocket ship take off and I’ll get 1/2 the ride I should. 🙂

    • chartfreak1
      chartfreak1 says:

      I totally agree. That is why I often look back at the 2016 move. The ICL before that one was August 2015 – and most things went sideways for 6 months- KILLED peoples desire to own miners. I remember how fearful most were that Gold was going to $800-$900 and Miners were choppy & stopping people out . THEN came the run that left many behind.

      I think that the break from the triangle will be similar but different . Similar when it breaks many will jump in and may get stopped out on a back test & hate Miners. Different because once it gets going upside, most will recognize the triangle break out & EVERYONE will want Miners.

      MAYBE that is how it will eventually play out, and right now – many still hate Miners action lately, and I dont blame them 🙂

  5. Steve Tytler
    Steve Tytler says:

    TQQQ is a “buy” on my 15 min chart this morning for the gamblers. Maybe it bottoms today? I’m not a day trader, but I may take a small position in my trading account just for the heck of it, I can bail quickly if it doesn’t work out. I will wait for bullish signals on my daily chart before I go long TQQQ in my retirement accounts, which is where most of my money is.

    • RonB
      RonB says:

      Steve that seems to be very conflicting advice. CF laid out all the logic why this is headed for a dcl or icl, and the need to be protective.

  6. Steve Tytler
    Steve Tytler says:

    Notice the difference between NUGT and JNUG. As of right now, JNUG is -1% while NUGT is +0.6% JNUG ain’t what it used to be.

  8. RonB
    RonB says:

    Friday, mid summer hmmmm, as I clean up my golf clubs, I wonder how much buying power is NOT going to be sitting at their desks today. hmmmmm, might as well join them later on

    • chartfreak1
      chartfreak1 says:

      Thanks EJ – I almost missed this comment.

      I am an active trader, but the patient ones often rack up good gains and less losses, so how can you argue with that 🙂

  10. Kenny
    Kenny says:

    Started small position in XIV in pre-market. Should get nice bounce. It took a beating this week. Have a great weekend everyone. Thanks Alex for your hard work you do for us. 🙂

  11. The Seer
    The Seer says:

    I enjoyed seeing other opinions here. I am doing well on my own since trading
    since 1998 in metal. I am leaving this site. Be sure to include more of the “real news”
    in your trading analysis and not just charting . . . Good luck to everyone.

    • Steve Tytler
      Steve Tytler says:

      Seer, some friendly advice from a former hardcore stacker to another, there is more to investing/trading than the metals. Broaden your horizons and you will make more money. It took me a few years to realize that. Good luck with your trading.

    • miller
      miller says:

      You are aware this is a charting/TA site ? Thats what we come here for is Alex’s charting and technical analysis. If I wanted the “real news” I’d subscribe to Market watch. Keep in mind though, by the time you hear the “real news”. the market and the big boys have known about for awhile and acted accordingly already. Best of luck to you as well.

      • chartfreak1
        chartfreak1 says:

        So true Miller! I have seen the charts move in a direction that is explainable 6 months ahead of real news…. explainable until later when the news was released.

        At times It could be Insider buying, because they know the company is doing well, it could be insiders selling, because they do not feel that the ‘books’ are looking good. And in precious metals, it could even just be smart money accumulating foreseeing Inflation 6 months ahead or something else.

        Someone always knows something before the ‘real news’ comes out.

    • Maria
      Maria says:

      … yes .. i saw your post the other day… sure hope you aren’t being hasty because of the ‘Link” comment … this is a pretty good group here… and CF .. he’s ok too… 😉
      to each his own …Good luck in your journey

    • Zoli Nep
      Zoli Nep says:

      Alex’s site is called Chartfreak so that should have given you come clues as to what his style is 🙂 Good Luck in your trading

  12. Steve Tytler
    Steve Tytler says:

    Bot more NUGT, didn’t get close to my gap fill but it looks like LOD may be in. But plenty dry powder left to buy more. I keep chipping away.

  13. MM
    MM says:

    Charts look promising for GDX, etc. I am always cautious though when a technical pattern forms based on headlines and the news cycle. I tend to see those reverse often. Anyone else concerned that once N. Korea calms, gold reverses and catches all the recent converts in a false breakout? Buying DUST here.

    • chartfreak1
      chartfreak1 says:

      Hey MM

      I am not disagreeing, and I’m not saying that DUST won’t work out, because it is still possible that this is all part of the first daily cycle out of an ICL, and if so, we are on day 26 or so, so a drop into a dcl could come, IF that wasn’t a DCL on the 50sma recently.

      But what I did want to mention was the N.Korea stuff really had nothing to do with the big picture triangle pattern forming since the February highs. So really , I agree that anything could happen with N.Korea now in the mix. A calming down of tensions could trigger a dip, escalated activity could foster a flight to safe haven. The Big Picture Triangle pattern, however, is a good consolidation period all by itself 🙂

        • chartfreak1
          chartfreak1 says:

          Thx, and I was hoping to be clear that I wasn’t disagreeing with you too. If N.Korea tensions cool down, it could directly have an affect , bringing prices down to a dcl or a 1/2 cycle low, depending on where we are. So I agree. Just the big Picture remains overall bullish to me .

  28. Cal Staggers
    Cal Staggers says:

    Wouldn’t that be like Mr. Market, Alex – GDX not giving you a close in the green, but not in the red either?

    I don’t have a favorable entry price like you, so I’m keeping a very small position in GDX/J with no leverage just in case next week starts with a pop – and if it gives us a drop, it won’t hurt too much

    Have a great weekend!

      • chartfreak1
        chartfreak1 says:

        BT – Yes, personally I take a position when it looks like an ICL is in place and a 2nd dcl. I do not make a recommendation of it for my readers of my reports though, if you mean leveraged. It is higher risk when the dcl is not clear

    • Nord
      Nord says:

      BTW: For non-lazy people: Look on how the 2 and 4 year cycles are interacting in gold. Look then at where we are relative to the 252-ish point. Look how trends are changing at course of 2 and 4 year cycles. Look at how resistance and support levels are set.

      • Nord
        Nord says:

        Hint: The DCL I believe will be between lower zone 1257 and 1263 with upper zone to 1280. However, I do not think we will hit the top before Aug 21 ish at a level of 133X.

        • chartfreak1
          chartfreak1 says:

          Hello Nord- I do not understand. Your chart above does not show price dropping below $1285 or so, but here you are saying that you think it will drop to 1257 after late August? That does not match your chart, correct? Thanks

          • Nord
            Nord says:

            Hi Alex. My main scenario is first up to 133X, then down to the interval range between 1257 up to 1280 with my “mean” price expectation of 1263. In chart I have just painted it to upper range, so its not exact each interval section. I am not Nostradamus 🙂

      • Maria
        Maria says:

        What??? Non lazy??? Not Fair!! Grrr… Howz about u say umm “time challenged” … Mr. Viking…………some of us work full time and have large family responsibilites, etc…
        *Speaking for myself of course… 😀

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