SPX TUESDAY – Break outs often ‘back test’ the break out, so I mentioned that this drop Tuesday was possibly just a back test. General Markets would be a BUY with a tight stop at this point. ( UPRO, TQQQ, ETC).
SPX YESTERDAY – SPX broke back above the 10sma and that was likely a perfect back test. This is a buy, but we really want to see this move higher quickly. That may have been a 1/2 cycle low.
NASDAQ – And the NASDAQ broke out higher too.
Yesterday I pointed out the IWM or RUT at the highs, so nothing has changed, that break out from the triangle in the SPX remains bullish for now.
USD – The USD had a reversal and looks like it will finally drop. That MIGHT help Gold. I say ‘might’, because this was a good size reversal, but Gold was only really up slightly Wednesday.
GOLD SHOULD BE AT OR NEAR THE LOWS, WE ARE WITHIN THE TIMING FOR AN ICL. I HAVE MENTIONED AND PROVED THAT THEY COME TWICE A YEAR. THAT IS IMPORTANT, THESE ARE THE BEST TIMES TO TRADE MINERS. THE LAST ONE WAS IN DECEMBER, BE READY NOW.
GOLD $#1 – I wanted to show the ‘1 more drop is possible’ chart first. Here we see gold has bounced up to the downtrend line and looks similar to the time in early May when that quick sharp drop happened. So this is a critical area where it looks like it could break out or drop. Let’s look at a bullish chart…
GOLD #2 – What I see here is that it actually DOES look like the trend line has been pierced, Gold is above the 10sma, and this is actually looking bullish after the lows have been put in place. The 200sma is acting as resistance.
1. Watch for a break of the 200sma ( Currently seen at $1308.67)
2. Look for a bigger push through that blue trend line, and we could have an ICL after that mid-May slam down.
GOLD BIG PICTURE- I just wanted to point out that GOLD started out with a bit more of a gradual climb coming out of the 2001 lows. It then started to ramp up quicker in places as the Bull became more obvious and buyers flooded in. We are currently in a large base, so Gold is gradually climbing now, but when it breaks out from this base, I believe that it will ramp up rather quickly, similar to the manner that it fell in 2013.
GDXJ – GDXJ had good volume and recovered the 10 & 50 sma. I was trading a short term trade on Tuesdays reversal & decided not to sell it, with that move. Watch for the 200sma to be taken out and that trend line to be broken for Bullish follow through.
XAU – The XAU does not offer volume analysis, so I consider it secondary, but the XAU is above the 10, 50, & 200sma, so I wanted to point that out. This is another reason why I didn’t close my open trade in GDXJ ( actually leverage, smaller position).
GG – Recently I pointed out GG as a component of the GDX ETF, and mentioned that it has been pushing on the upper trend line. Would it break & help GDX, or drop 1 more time? …
GG – It broke out yesterday, so I posted this in the comments after 3 p.m. Eastern. This is bullish and another reason why I kept my somewhat risky Miners trade position open.
This is GOLD as of 6:30 a.m. Eastern time this morning. It seems that any price movement higher than the current $1303 keeps Gold above that trend line.
CONCLUSION:
So I am watching Gold , Silver, and the Miners this morning closely for a possible continuation higher. It actually looks like Gold wants to break that trend line, keep an eye on that.
As you know, I also trade on the side for a living. With the possibility of an ICL in place (which I honestly though would be the ‘least likely scenario’ vs 1 more quick drop into the June FOMC) I was posting in the comments section intraday charts of Gold this week. I do this to monitor Golds progress or lack of progress.
At one point, as a short term possible 1 or 2 day trade, I took a small trade in GDXJ ( leveraged) just looking for maybe $13.85 to $14.30 or so. It is obviously not a very large position, but as GDXJ ran higher yesterday with Gold possibly breaking that trend line, I decided not to close it yet. That is quite risky when we could be facing another quick drop, but the position is small enough and the ‘timing’ is late enough that even if it JNUG dropped $1 to $13 overnight, I know I can put up with that, because I’ll make that back quickly after an ICL. Now the question remains, did we see an ICL drop already in Mid May?
If Gold continues higher above that 200sma & trendline, I will actually add to that open position. A sharp drop would have me close it obviously, until the next reversal takes place. At this point, if Gold moves well above that trend line, the move in Gold will look like a low has been put in place last week and Gold wants to run higher again. It IS facing a lot of resistance at this point, I am in a higher risk than usual trade, especially holding it overnight, until GOLD clears the multiple resistance areas.
I am basically over 50% cash waiting for this low to confirm, and I’m really personally focusing on Miners at this point in Golds CYCLE work. Yes, I still own ENPH, OGRMF, CANN, etc, as non-Miners, but We only get 2 ICLs in Gold per year, and Miners often run very nicely for AT LEAST a month or 2 after an ICL. I want to be ready for that run with Cash or by holding a few positions in Miners now too. They should run longer than just 1 month if Gold breaks out of this base, and I want to be heavily invested in Miners when that takes place. Is the ICL now? Or is it closer to the FOMC Meeting in June ( or July?). I am monitoring Gold for the clues each day. Gold is starting to look more & more bullish as it presses on that trend line & the 200sma.
Enjoy your Thursday trading!
~ALEX
TAHO #1 – Yesterday I pointed out TAHO WEEKLY as a buy. It is a really nice set up and has good potential once it gets going. Under $5, it could easily double if Gold & Silver break out & run.
TAHO #2 – This is the daily as of yesterday. Now it is slightly over $5, but notice how it broke above the 50 & 200sma and has crawled along both. Let’s zoom in for a closer look.
TAHO #3– This may be ready to finally get moving higher, and we have seen Miners like GORO, KL, etc ignore the selling in Gold.
GORO – We have seen a few Miners ( like GORO) ignore Gold selling off as it breaks from its base & continues to run higher.
EXK – 2 months ago I mentioned that I really like the set ups on Silver stocks. EXK ran higher and has now landed on an Uptrend Line & the 50sma. This could be bought as ‘low risk’, because a fairly tight stop can be placed under the trend line or 50sma. THAT IS THE GOOD NEWS…
EXK – Slightly more negative is that it never did back test the 200sma green line. It doesnt have to, but it could if the Metals dropped into an ICL from here. As mentioned, it is still a buy if you ‘use a stop & avoid the drop’.
FSM – This set up is very similar to EXK, but this one DID break above the 200sma & back tested it already. It still needs a stop if someone is buying it, but maybe a bit looser below the 50sma.
NON-MINERS
CY – Some semiconductor stocks are already back to their recent highs, like CREE and MU, others are not but may head that way. CY did a shake out at the 50sma, and I mentioned then that it could be bought as it recovered. It ran higher to the trend line & stalled. Now it has broken that trend line and it looks like it will run higher too.
SGH – We traded this in March, and then it sold off back down to the lower trend line. It started the move higher in May and stalled when the markets did. This should run back to the upper trend line if the markets remain bullish longer term.
SQ – We traded this one recently too, it has done well in 2018. I noticed that as it formed a ‘Cup’ in February, it went sideways and then broke out & ran using that as a Mid point consolidation. It seems to be doing that here too.
Wednesday May 30th 
Friday- Navigating The Choppy Waters
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