Yay Or Nay? Wednesday Fed Minutes Release

Today is the release of the Fed minutes.  At times we get the same reaction that we saw when the Fed Decision was released, and other times we get the opposite, so that is todays question…what will todays Fed Minutes bring? It shouldn’t be as bad as THAT guy thinks, but it is worth paying attention if you are rather heavily invested.

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SPX –  The markets pulled back a bit on Tuesday, but after that strong 6 day blast higher, the pull back was minimal.

 

NASDAQ – 5 or 6 strong days higher out of a slam down low, we saw a slight pull back Tuesday here too.  Personally  I LIKE SEMICONDUCTORS like  CY, MU, CREE,  etc. mentioned in past reports  ( And SOXL, maybe on a pull back?).

As the General Markets pull back,  I am watching how they dip back down, or what they want to do after the Fed minutes are released at 2 p.m. Eastern time.  As mentioned in the weekend report, I’m still wondering, was that an ICL?  Or is it going to be an  a-b-c type drop.

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USD #1 – Notice that only  ICLs break out strongly & stay above the 30sma. A daily cycle low will break above the 10sma, but the 30sma has held it back in the past, so this should help me to gauge the USD.

USD #2 – Zoom in…  The USD  has broken the 30sma, but it doesn’t last. This could be related to the GOLD/MINERS move. I’m going to watch this on the FED RELEASE.

 

WTIC – Is this a good place to short Oil?  A back test of this trend line? Maybe, but I am going to wait for further signs. Oil daily cycles last 30-50 days, and this is still quite early.  It did tag the trend line & drop back though.

 

GOLD – Looking at this chart, There is nothing wrong with Gold.  It remains bullish, 100 points above the Dec lows of $1240, but try feeling like it is bullish if you are heavily invested in Miners heading into Fed Minutes, right?  Will the $USD Break higher, and Gold break down?  Or Visa- Versa?  Let’s discuss Miners…

 

 

LETS DISCUSS THIS IN STORY FORM

 

GDX Bigger Picture CHART #1– Honestly, you have to play this as it presents itself.

1. Many  bought the lows or entered a day later, when we got a STRONG reversal & a run higher.

2. Usually you do see a pause in the middle of this range. THAT is the way to play this,  UNFORTUNATELY…

3.  In just 2 days we are selling back down now steeper than expected. Fed minutes are released Wed, and that could be VERY BULLISH if they discussed inflation, or it could cause additional weakness.

GDX CHART #2 & 2 obvious scenarios –  Just looking at recent movement in the Miners, it didn’t matter how good Gold looked,  miners are being accumulated and trading in a range.  WHEN INFLATION CONCERNS came out with the CPI #,  MINERS TOOK OFF!  That is why the FED MINUTES could be a catalyst for Miners if they discuss inflation.  For now? Choices -ALL YOU CAN DO IS SELL & WATCH,  GET BACK IN WHEN THE TIME IS RIGHT?   OR TAKE YOUR CHANCES.  THE LOWS at the CPI were valid entry for a swing low, this pull back is uncalled for.

 

LET’S TRY GOOD NEWS / BAD NEWS

 

This is not what I would expect, but I can’t ignore this as a possibility for Bad news cycle-wise. It has been in the back of my mind since I mentioned it in January, but with GOLD set up as beautifully as it is, this seems unlikely.

 

GDX – THIS IS A CAUTIOUS CHART, see if you can follow this for cycle count-   WHAT IF we saw a short first daily cycle to a day 19 DCL. A 2nd daily cycle with a peak on day 11 and a 2nd dcl on day 22. This would now be a 3rd daily cycle, weak, heading to break the lows,  and run all of the stops.  🙁   HOWEVER!!!!!…

 

 

HOWEVER-  Individual Miners do NOT seem to be acting that way yet. I will show you that soon…

 

GDX – So GDX dropped below the 10sma & closed there. I hear some say that is the death signal, but it does happen and can recover.  In fact, look at Jan 8th.  If that wasn’t a DCL in your eyes, then it was just a close below the 10sma for 3 days and then a continuation higher.  A 1/2 cycle low.  Personally I DO NOT like that MACD/ RSI  crossing down as a warning.  I feel we need to Turn higher now or beware.

 

Reminder HUI 2008 – This shows HUI dropping all the way back to lows in 2008,  twice.  It CAN happen, but riding JNUG is NOT good when that happens.  I got stopped out of 1/2 of my JNUG yesterday. I dont know whether I am happy about that or not.  I locked in some profit, but now may have to re-enter higher if Miners take off.

 

IMPORTANT NOTE: DO NOT USE MY STOP ON A 3x ETF.

I do NOT buy & trade 3x ETFs the same as individual Miners, and I have mentioned this before when I have mentioned that ‘3x ETFs are really only for experienced traders’.  They can be BUY & HOLD IF you catch ‘THE LOWS”, because your stop is right there, close to The lows.  As it rides higher, you can raise stops.

HOWEVER: IF you wait 4 days out of the lows and then we get this, and you then decide to enter a 3x ETF without a stop? Please read the chart…

 

JNUG – I bought JNUG at an average of $12, MY STOP is obviously lower than what someone elses entry should have it at, even if they added 1 or 2 days later.   It is a 3x ETF, Losses come quickly.    A drop from $16 to $12 is mentally draining. “WHERE IS YOUR STOP”! You can always get back in.  This is why only experienced traders should use a 3x etf.

 

LET’s GO BACK TO THE MAY 2017 LOWS

 

GDXJ – MAY 2017 was the lows for last year in GDXJ, even though GOLD put an ICL in in July.  So I wanted to look at MAY 2017 for GDXJ and see what the drop looked like.   In May GDXJ dropped beyond 61.8%, but never closed down below there. I’m was just looking at this to see if  the recent drop of 61.8  is normal or abnormal?   So far, it has done this before ( but no MACD cross in May).

 

GDXJ – SO far, this drop is 61.8%, and ALMOST a MACD cross.  As I captured this chart, it only showed Vol at 8.7 million.  Minutes later at 4:02 P.M.,  they added to it and it doubled. 16.7 Million total, but that was still 1/2 the volume as the move higher.  THAT is what I like to see.

 

So what about individual Miners?  Are the getting slammed or not?

 

 

GG -This looks fine so far, right?

NEM – NEM is also fine so far, right?

GORO – Goro was looking fine too, when I posted this in the comments near the close.

 

THM – Another Miner that doesn’t look damaged.

 

NSRPF was even green

AEM- I found a couple that were rather ugly,  but I haven’t found many like this.

So this is really a situation that is difficult to address.  I see ‘Miners’ and GOLD looking fine, but GDX & GDXJ seem to be selling down further, thus NUGT & JNUG exaggerate that move too.  Stay Frosty if you own a 3x ETF, we have FED MINUTES release today. This sell down could be real weakness, or it could be pulling the sling shot back for the FED MINUTES release, if Inflation concerns were the topic of discussion.  Try to enjoy your Wed trading, and use stops to protect your funds, there is always another trade  (or entry).

 

~ALEX

 

 

EDXC – This popped out above the base and also closed at 3 million. They have ( in the past) reported very good growth for their product and it s targeted toward pain relief for animals and anxiety relief,  so ‘Legal ” situations should not influence it.

 

GGB – I still own this, it is acting correctly and may form a handle.

 

BITCOIN–   I think that BITCOIN broke a down trend.   I am watching blockchain stoks that ran well last time, and they seem to be shaping up too, moving over their 10sma  ( Some under the 50sma though).  GROW, DPW, MARA, etc.

I am also still watching MJ stocks as they consolidate. Several are also moving back above their 10sma, and this is what you want to see to make sure that the strong rally higher wasn’t just a 1 hit wonder.  I liked  TWMJF, ACBFF, OGRMF, SPRWF, etc yesterday on a 3 month chart.

SPRWF #1 – I actually bought SPRWF yesterday, but I may be early. I was looking at this as though a break above the 10sma could lead to a run back to former highs now that this has consolidated. THAT CAN HAPPEN (see chart)  But…

 

 

SPRWF #2 – I have seen these massive moves higher simply consolidate, similar tot he 2017 year.