Friday November 17- A Lot Going On

Today is Friday and it is the last trading day of the week, so let’s take a look at the markets and then discuss a couple more trade set up ideas.

DJIA –  We do see a break above the 10sma in the very bullish run of the Dow & SPX.  The Dow closed slightly below the 10sma. The reason I wanted to point out the lack of follow through  in August on this chart is because of  1. The divergence that was popping up recently, and 2. I got several Emails telling me that the ‘Sell On Strength’ numbers in the WSJ showed up as very high.  That doesn’t usually happen one day out of a daily cycle low, so let me just say this… that warrants a little caution at the very least

1.This is a break higher and could be bought as a day 1, but there is a chance that you could be stopped out, so maybe start small?

2. The stochastics is not completely oversold

3.  Divergence has not only happened in internal indicators, but the RUT & TRANNIES are very out of sync with SPX , DJIA, NASDAQ.  Just remain alert ( Stay Frosty) until we get more follow through. A drop to the 50sma without a stop would hurt you 3x ETF traders.

NASDAQ – The NASDAQ actually broke to a new high, up about 100 points at one point.  This looks quite bullish, really, and we do see a series of higher lows and higher highs, so some may never even have been stopped out of their trailing stops.

XBI – Long Term, Biotech has been in a bull run higher, and is at a support area.  This is a buyable area, according to this chart, correct??   Looking at it this way,  you could just Buy the lows,  sell at the highs,  HOWEVER- So many traders here only want to buy THE LOW WITH 3X ETFs.   Another strategy has to be used when trading 3x etfs, if you keep tight stops.  The idea is that We look for swing lows, probabilities of support, a reversal, and so on,  and if someone is only using 3x etfs-  START SMALL and add when confidence builds.    Look at this chart.  Can this dropped to the 200sma below the blue channel in your mind?  Yes, it has in the past a few times,  so it could do that again, but this is an uptrend and remains bullish at this point. Read the chart and continue..

The above chart looks like the last 3 ICLs (Magenta lines) dropped to the 200sma or overshot the lower blue line.  If we are headed for an ICL, we may do the same here.  This current reversal could be bought, but this may or may not be THE lows.  It is a very bullish 2 yr chart though.

USD– The USD reversed on the 50sma at 93.30 – this is a new level to watch if you see the USD selling down. If that low isn’t broken, it means nothing.

WTIC #1 – Let’s look at OIL again.  THIS WAS MY NOV 7 CHART after a solid Break out, and a back test COULD come to $55 or $54. There is a small break out at $52 also ( not drawn in), and the 50sma was rising up toward that area.

WTIC #2 – We are experiencing the back test, I think. We are at the $55 area. The 50sma has now reached the $52 area, so I drew that smaller break out level in with a Magenta line.

WTIC #3 – We are a bit early for a dcl too, so I think that Oil could drop further, even though we saw a reversal after the inventory report. That could be a bull flag bounce. Here I am high lighting that $52 shelf more clearly and this is where the 50sma is.   We could be seeing an A-B-C down to $52. Time will tell.

XLE –  I thought that when Oil did a back test,  Oil / Energy stocks would go sideways or hold up well.  I saw a bull flag forming & Expected another strong leg higher sooner than later. The XLE looked good here just last week.

XLE – I was flat out wrong, this sold off sharply Tuesday as Oil pulled back.  Please read the chart, as I point out a possible bearish rising wedge.

XLE- Here I have added a lower parallel line. This can go sideways to the line, or this can drop further to that line. With that in mind, I have been cutting my positions in this sector until I get either better clarity or Bullish reversals and recovery for another run higher.

Yesterday I showed how WTI, CRK, LGCY, and a few others are still looking ok, holding up well. They still are, but if that is a bear flag in OIL and Oil could drop to $52?  I want to step aside or use TIGHTER Stops to avoid more draw down.  I was buying this sector over 3 weeks ago, and even though I locked in some gains, I have given a lot of the gains back in this sector, especially  with Tuesdays surprise drop.

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GOLD – Our parameters are in tact, watch these numbers. A break higher above the 50sma is unexpected.

GDX – Miners have been weak, and remain under the 10sma on a closing basis.

Enjoy your Friday trading and we’ll see you in the weekend report!

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~ALEX

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URG- From yesterday, I mentioned that you might want to look for reversals at support on Uranium stocks, since the move higher was explosive volume and the pull back was very light volume. Positions could be taken there as a lower risk, much netter than chasing & jumping in last Friday.

URG– BIG reversal here.

DNN –  Dropped to the 50sma ( Possible dip to the Magenta line near 44 cents). Reversal would be an entry.

DNN – Dropped to 44 cents at the Magenta line & reversed back above the 50sma. That was a low risk buy and follow through Thursday.

UEC – UEC had a reversal on the 50sma  ( I didn’t love this set up due to the gap, but it was a possible buy with follow through so I posted it).

UEC – It gapped again.  This makes me wonder if these ( or this one) will consolidate a bit and drop back down?

CBDS – I also posted this MJ stock that I like the consolidation base.  I said that I will buy this if it breaks above the upper red line.

CBDS – It didnt  🙂  but I still love this set up.  I am watching this daily now.  I almost bought this right here at lunch time when I checked it on my phone, thinking that it must be the low, but I own a few others and that held me back. Please read the chart.

DANGER DANGER – BLOCK CHAIN!

NOTE: I have mentioned that the set ups in my BIOTECH BASE PICKS , some of the MEDICAL MARIJUANA TRADES, and these BLOCKCHAIN TRADES  ARE HIGH RISK, AND  MAY NOT BE FOR EVERY TRADER OUT THERE.  I HAVE REPEATEDLY WARNED TO MAKE IT CLEAR THAT…

1.THEY ARE NOT FOR EVERYONE.

2. SOME SHOULD PASS AND JUST WAIT FOR A GOOD SET UP IN MINERS LATER.

3.  IF YOU TAKE A POSITION, MAYBE START VERY SMALL AND SEE WHAT HAPPENS.

4. DO NOT TRADE THESE IF YOU ARE NOT EXPERIENCED ENOUGH TO KNOW WHEN TO SELL OR CAN TRADE THESE WITHOUT MY ASSISTANCE.

5. DO NOT TRADE THESE UNLESS YOU CAN KEEP AN EYE ON THEM. I MAY NOT ALWAYS BE THERE TO GUIDE YOU- KNOW WHEN YOU ENTER WHAT YOU EXPECT AND WHEN YOU WILL EXIT  ( HIGHER OR LOWER).

AND NOW I WANT TO ADD ANOTHER WARNING…

6. THEY ARE LIKE DEAD FISH IN YOUR HANDS, THE LONGER YOU HOLD THEM WHEN THEY ARE NOT ALIVE & SWIMMING HIGHER -THE MORE THEY WILL BEGIN TO STINK.

BLOCKCHAIN

I HAVE BEEN TRADING THIS SECTOR ON THE SIDE , trying to figure it out, experiment with entries, exits, etc.  Some of my favorites are RIOT ( It was ticker BIOP when I first traded it), GLNNF, and PRELF.  We also have GBTC, BITCF, BTSC, GAHC, SING, and a few more that are struggling and I wont mention them yet.    I want to point out RIOT here, if it breaks out it could really run nicely.  I have traded this one a lot,  it swings like Tarzan through the jungle, so be careful and do not trade this if you are inexperienced.  See my guidelines 1-5 above.

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RIOT –  This actually looks like it may be ready to break out higher. If it does, it could run well.  I have traded this a few times.  Made big money, lost good money.  This is a MUCH Tougher ride than it looks, let me explain…

RIOT – This was SO difficult to ride, the swings were brutal on a day to day basis at times. Please understand that if you simply bought 1000 shares in early October,  your account gained and lost $2000- $3000 in just 2-3 days at times .  If you bought 2000 shares, your account jumped up & down by $4000-$6000 in days.  It went from $10 to $7  / $7 to $9.50  / $9.50 to $$6.5.   However…

RIOT – The long term chart points out the recent resistance, and RIOT seems to be preparing to break out.  This week? Next week? I can’t say, but again, a break out could really run quickly higher…

I currently also own PRELF, but it could drop to the 50sma.  I am not recommending it here and I have a tight stop mentally.  I am now out of GLNNF, that was a great trade.  It still looks very bullish and I thought that it was a buy with the reversal 2 days ago.