Wednesday April 23rd
Where are we in the various sectors of the Markets? …
NASDAQ – Like a Magnet to former highs, The NASDAQ pushed up toward the prior highs of 8133.30. Zooming in we see…
NASDAQ -Zooming in we see that we are on day 31, so this does have time to break out and back test as a dcl. At times, however, the initial attempt to break to new highs stalls or finds sellers, so we will have to wait and see. Often we see a Break out & then price falls back – That’s called a BULL TRAP, since Bulls buy the break out to new highs and then price drops trapping them in their long positions. Either way (break out & move higher or stall) this has held above the 10sma after the 1/2 cycle low and using a trailing stop has kept one in the run. We will be coming due for a dcl though.
SPX #1 – It is the same with the SPX, it popped higher Tuesday and I was seeing a bearish rising wedge. IF THIS BREAKS EVEN HIGHER…
SPX #2 – When a bearish rising wedge breaks higher, it can run and form a channel. This late in the daily cycle, it seems less likely, but I wouldn’t count it out. I’d just continue to trail price with a stop, since…
SPX #3 – SPX has been drawn to prior highs too, so 1. we may see that act as a temporary resistance area , or 2. we may get a quick break out and then drop back down for the dcl. That would be my best guess at this point, due to cycles timing. Let me show you more…
SPX BREAK TO NEW HIGHS – Just 2 examples here:
– The first blue arrow shows that in 2007, the SPX almost broke to new highs after a strong run too, and then it sold off into a bear market. That is a double top.
– Later on, in 2013, the SPX broke to new highs during a strong run, then it back tested the break as a dcl, and continued to rally.
SOX – RECENTLY the Semis ran up to the prior highs in March, but suddenly stopped & quickly dropped into a dcl (blue arrow). The next daily cycle saw the break out & is still running. This is why I say that we may break out & back test, or we may stall and try to break out in the next daily cycle. EITHER WAY- trailing with a stop has worked.
Summary: We see that the Markets are approaching former highs and are at day 32 today, so it could be considered that this run may be starting to ‘get late’. It would seem that we either stall here & drop to a dcl and break out on the next daily cycle ( this is right translated), or break out briefly and drop back to a dcl after that. EITHER WAY, just use a stop. The 10sma has been supportive and we do have a lower trend line on the wedges.
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WEDNESDAY IS OIL INVENTORY REPORT DAY: THEY HAVE BEEN BULLISH OVER THE PAST FEW WEEKS
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WTIC – So far the pull backs have been mild with oil, and it may remain that way. I discussed that OIL fell straight down Oct – December and could continue to recover straight up too. It barely breaks the 10sma, so maybe the 13 sma or 20sma would be a good place for a stop. It is possible that we get a deeper dip into a dcl to back test the major moving averages, but so far this is running higher in the same manner that it dropped.
USD – From April 20- Expect the USD to run higher. It may peak when Gold puts in an ICL…
USD – The USD has continued higher this week and it even broke out, as expected.
GOLD – Gold is not dropping as rapidly as I would have expected, and this even has a reversal candle at day 32. I would love to see a quick sell off here to give this more of an ICL look, but a move higher does put in an unconfirmed swing low. This is the 8th month since last Augusts ICL, so we are due for an ICL. I recently wrote report showing how I have seen these moves ( ICL to ICL) actually stretch out a bit longer in Bullish scenarios.
SILVER – Support was slightly broken, but the wedge remains in tact.
GDX – Unlike Gold & Silver, The Miners have been selling off steadily- day after day. THIS looks a bit lore like an ICL drop than Gold or Silver do.
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HERE IS THE PART WHERE IT GETS TRICKY: I am being asked, ” How can we tell if a bounce is just a bounce, an ICL, or one more daily cycle?” The answer is that you can’t until it plays out. The next 3 charts address that.
GDX #1- That was a small indecision day and a small bounce can put a swing low in place. This late in a daily cycle, it could be the DCL or ICL if it gets above the 10sma. It also may just be a bounce under the 10sma & roll over to day 38 or so.
GDX #2– So if it is an ICL, it would eventually break the 50sma and break to new highs, but if this still needs more time for GOLD to sell off?…
GDX #3– Then you would be buying a bounce that rolls over . It could even be that 1 more daily cycle of selling needs to occur to shake out the bulls. WE DO NOT KNOW until it plays out, so the answer is…
We Buy a swing low with a stop and then see how it acts coming out of that low. Is it an ICL & it rallies? Or do we end up getting stopped out as it rolls over & takes out the lows? OR you can wait for the rally and miss the lows. Do you remember the September ICL? UGH- Read the chart.
GDX: GLD – Even the GDX / GLD ratio actually broke down, since Miners have been selling down more than Gold.
MAG – Trying to get clues from various Miners doesn’t help. I see some breaking to new lows and looking like an ICL sell off ( CDE, FSM, etc etc ) And then MAG , KL, etc look Bullish. Will MAG get to the 200sma or not? This looks like a Bullish descending wedge. Some Miners are developing bullish patterns, others are breaking down.
LODE- Even with the Precious Metals selling off for weeks, juniors LODE, TRX, and a few others have held up better than others for example.
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Only time will tell us whether we are near or at an ICL. The only thing that you can do is decide to buy the swing low and take chances on catching the ICL as close to the lows as possible? Buying and possibly getting stopped out as it rolls over to more selling or another daily cycle? Or do you want to wait for further confirmation, accepting the fact that you may miss the lows, but you’ll still catch a lot of a great rally once the ICL is confirmed? I will discuss these choices along the way. We’ll see what Wednesday brings our way.
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Enjoy your Wednesday trading!
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~ALEX
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BITCOIN – Weak Break out & stall or back test currently taking place
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General MArkets : Looking at charts of DBX, TWTR, KSS, etc – there are still stocks that are really Popping in some areas, and in other areas I still see stocks that look like they are set up properly to move higher…
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BIDU April 1 – BIDU was a buy in early April. It broke out, ran higher to $186, and pulled back…
BIDU Now – That seems to have been a back test and it popped higher again Tuesday. It is now oversold again, so it could be bought ( or added to ) with a stop under the Magenta line.
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The noise of bad news:
HVBTF #1 – HVBTF came out with some ‘News’. It’s a long story, but basically I didn’t think that it was all that bad, but markets do hate indecision, so investors dumped the stock until things get cleared up. It found support (so far) at the intersection of the 50 & 200sma, and I captured this bounce midday. I have accumulated this since 20 cents, so I sold a small chunk and wanted to see if this support holds for the rest.
HVBTF #2 – It then closed at the lows. I wanted to hold this as a long term stock, but I do use stops and this may be the area where I have to let it go. I am hoping that Price just bounces around here until things settle down. I am hoping that this support holds, this has been such a nice run.
HVBTF #3 – I drew this early in the day to show that this could drop to 40 cents too. We’ll see if this can hold up.
HVBTF: This chart was my long term reason for buying & holding Hive Blockchain_ Again, the story may just be a temporary blip. This is the story at the link below if you want to review it. They feel they are owed $50 million, and the company owing them that 50 million is also owner of almost 30% of the stock and is trying to take over HIVES board of directors. This uncertainty is causing investors to leave until the dust clears. Click this link…
HIVE BLOCKCHAIN HOSTILE TAKE OVER
EDXC – This looked ugly in the morning as it sold off. It was down 31% here, but it was even lower earlier. It looked horrible, but this was simply amazing to watch in real time, because …
EDXC – It completely recovered. I don’t think I can recall seeing anything like this before. If you owned it, went to work, and came home – your account would be fine and you may not even know that this sold off 40+%, unless you looked att his chart. Amazing!
ENERGY TRADES REMAIN IN PLAY, ALONG WITH THE MJ SET UPS, SEE YESTERDAYS REPORT FOR EXAMPLES- WEDNESDAY IS THE OIL INVENTORY REPORT. LATELY THEY HAVE BEEN BULLISH FOR OIL.
