Give Me A Break!

I sure hope that it is break time!  Let’s take a look at our markets after the Fed minutes were released…

QQQ – I captured this chart at 1:49 p.m.- right before the Fed Minutes were released. Do you see similarities in the blue boxes that I have been pointing out? I don’t like that gap.

QQQ – Notice on this chart that the small rise in price in April & May crossed the MACD in bullish manner. The run higher in June was larger but it didn’t cross the MACD, and it failed.  The recent run higher didn’t cross the MACD either yet.  We also have the gap, and the trend line ended up rejecting price at the Fed Minutes.  Personally,  this needs more time  / work  for me to be interested.

QQQ –  I captured this chart at 1:24. I noticed that in July after the Fed MTG, we had that flash crash 1 day later.  It actually gapped open much higher and just sold off quickly on July 27.  Now we were facing the same MINUTES of that MTG, so I became cautious and it will be interesting to see how this plays out Thursday & Friday.

USD –  Is the USD about to be rejected again?  That could boost Gold. The USD dropped mid day on Wednesday, and Gold shot higher.

WTIC – OIL is moving along in the timing for a dcl. It did tag the 50 sma area.  On day 21 & 22 Oil dipped below the 50sma and recovered, so we might want to expect that Oil could do that again seeking out the dcl.

XLE- And this is a fine mess (again).   I finally think that I hate Oil & Energy stocks, and I haven’t even been buying them!

GOLD–  This chart was simply captured to point out what Gold did when the Fed MTG took place on July 26. I used it in the comments section before those minutes were released to say that “Gold has been bullish after the Fed Mtg Date, so the ‘minutes’ could see bullish reaction too”.

GOLD – The ‘stockcharts’ chart for Gold was not correct, so I captured a live chart at midnight. You can see that Gold reversed and shot up higher after the Fed Minutes were released, and even had some follow through after hours into Midnight. Wednesday looks like day 6, and Thursday could be day 7 of a new daily cycle, and that is very early.   I want to be on board for that reason. 

SLV–  I noticed that the SLV broke the downtrend and did a baby back test on this move out of the July ICL,  just like the one in January out of the ICL.  That was about a 1/2 way move, so Silver MIGHT go test the April highs.

GDX– If I look at the GDX and draw a line from peak wick to peak wick as seen below,  it looks like GDX is about to FINALLY break out.  I have been pointing out bullish Miners ( RGLD, IAG, FNV, SSRM, PAAS, etc etc) To encourage some to take positions before the break out and to build confidence that things are lining up bullishly.  Now a break out would be a strong buy, and you could use a return under the trend line as a stop.

FNV WEEKLY –  On August 8, FNV reported strong results, and with earnings behind them, this was a Bullish break out and the buy.  I posted this along with RGLD and IAG charts. This is a cup & handle and is longer term bullish.

FNV – And we do see follow through now. I think that there are many bullish Miners to choose from, and the good news is that their earnings are now behind them 🙂

On Aug 11 I pointed out that using a line chart, it appears that GDX already broke out from the triangle.  Imagine if it back tested this triangle on the Fed Minutes day?

GDX–  It did do a back test too.  Now when I look at that GDX line chart, it actually shows a break out that already back test. That would make Yesterday the safer BUY.

GDXJ TRIANGLE – If this breaks out, I would not wait for a back test…

GDXJ–  Consolidations build energy and can lead to a solid move after breaking free, see my examples on this chart.  GDXJ could be ready to break from a LONG consolidation and I would expect a nice run from there.

I am showing you this actual triangle break out, because it did Not stop & back test the break. It hung around and looked weak for a few days, but then it took off.  I am showing you this in case you are simply waiting for GDXJ to break out & then want to buy the back test. With this chart in mind, if that was my plan, I would buy the break out and add on a back test.  ( I personally have been buying pre-break out) .

EGI– This chart showed EGI on the 50 & 200sma.

EGI –  It is still there now and Yesterday it moved up to the 10sma, I think that it will break out soon. Showing that strength while Gold sold off $10 Monday & $10 Tuesday, I would say that this is at it’s lows. Use a stop below the 50 & 200sma.

SA–  I pointed out SA earlier in the week, because it was also climbing up on Monday & Tuesday when Gold was down $10 & $10.  It moved higher again on Wednesday and looks set up to break out.  This was the classic break above the 50sma, and back test it for the ‘buy’.

 So I have posted many Miners over the past couple of weeks to show bullishness growing in this sector.  Now that we have the earnings behind us, and the release of the minutes to the Fed Mtg, the picture looks more and more bullish. Now we are finally seeing the long awaited “break out’ possibility in GDX & GDXJ and that can lead to a nice profitable run higher. We’ll see what happens on Thursday, and Fridays report will probably be another small list of Miners that are set up to move higher or break out, as long as this sector remains bullish.  Enjoy your Thursday Trading!

~ALEX

Things look very bullish, with many miners leading the way higher already.  I was asked, ” What if we got a final slam down into a dcl and the triangle breaks down? Does that mean we flip Bearish?”  I DO NOT EXPECT THAT AT THIS POINT, but nothing is impossible, so –  It would probably be another shake out similar to Jan 2015,  see the chart , and…

You would then can get stopped out,  but just have the mind set right now that you will buy again when it reverses.  MANY missed that 2016 run higher, because once it started it never looked back.  We here at Chartfreak did NOT miss it from the lows higher.  I immediately identified it as a shake out & we jumped in. Please see the chart, I view this as a less likely scenario, but it can prepare us for anything.