June 18- FOMC Wednesday 2 P.M. Eastern Time
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Today I want to run through some interesting reminders, and I will start with this schedule of the 2019 Fed Meetings and the release of the ‘Minutes’. Notice that May 1 was a Fed Mtg, and the Minutes were released on May 22.
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SPX – At this point we see that the General Markets gapped open yesterday, the day before the Fed Mtg, no doubt drawing in lots of Bullish buyers. Now let me show you something interesting, that many may have forgotten…
SPX DURING FOMC MEETINGS IN MAY – MAY 1 FED MTG, the markets began a sell off. After a bounce into the release of the Minutes on may 22, the 2nd leg of that sell off started on May 22. THIS WAS AFTER THE FED MENTIONED A CHANGE TO RATE CUTS. We rallied into the fed twice, only to sell off after both times. HMMM?
IWM – To be honest, the Russell 2000 has been sideways and weak for months, but it actually looks bullish here. It sold off in the whole month of May ( fed Mtgs), so now we’ll see if it can hold up or sell off after the Fed.
DO YOU LIKE STATS? THIS IS KIND OF INTERESTING…
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STATS – This shows that when the SPX was up 1% the day before the fed, it didn’t necessarily mean that someone knew something & got in early. Quite often it was Red the next day and even down the road. Just a stat to show that Tuesdays gap up & rally, may now experience a gap fill.
WTIC – Oil rallied and broke the 10sma, and this looks ready to move higher. It looked to be bottoming after the Tanker was damaged/ Attacked and this brak above the 10sma is bullish. It is easy to go long with a stop under recent lows, but this may be just a bounce.
UCO – I posted this live Tuesday Morning in our trading area, to show a potential target if we get a good bounce.
DNR – And I also pointed out that several Oil stocks are following, by breaking the 10sma, MACD crossing, and they are very oversold. They’d be good trades, but I am still just focusing on Miners. Others may like this area.
I traded OAS in the Teens a lot in the past. I can’t help but feel that $4.50 was a great price Monday, and we’ll see if it can finally break out.
USD – My unbiased look at the USD has me thinking that it looks like it wants to go higher short term. If the Fed DOES NOT cut rates, the USD could rally for a little while.
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GOLD – And my unbiased view of Gold makes me look at this and think that it does want to pull back short term. Why? It has wicks at the top of the candles, and that is often caused by selling pressure. It could be considered overbought, etc. SO FAR GOLD WONT BREAK THE 10sma. If this pulls back, it is a normal pullback, but I am also going to show a more Bullish view of this sector though…
GDX – Using a cycle count, this looks like day 32 and a topping candle. A DCL would dip and break the 10sma, HOWEVER…
GDX – That 2016 run had these ‘topping candles’ too, and the selling only lasted a day or 2.
GDX – So let’s say that we get a 2 or 3 day sell off, this could be a back test dcl.
GDX – I want to go back to cycle count. Is it day 32 and due for a dip? OR COULD THAT DAY 17 have been a dcl? If so we’d only be on day 15 & could continue higher. But could that little sideways bounce & Dip into day 17 really be a daily cycle?…
GDX 2008 – I still remember the same thing happened in 2008. Was day 19 a dcl? Or was the dcl day 29? It is too hard to tell, so with what we have now ( And that day 17 dip to a low), I’m just going to say that the chart is Bullish looking and whether we sell down after the Fed or not- the Big Picture is what you want to focus on.
THESE 2 CHARTS ARE FROM YESTERDAYS REPORT: THE BIGGER PICTURE
AND SERIOUSLY, HOW LONG HAVE I BEEN POSTING THIS CHART, EXCITED ABOUT THE POTENTIAL? A drop to ‘2’ and a reversal was a STRONG BUY. A BUY & HOLD FOR A CORE POSITION…
GDX WEEKLY – That drop to ‘2’ happened & reversed at the last Fed Meeting in May.
Whether this weeks meeting has us drop to a dcl or break out and fly, you want to still be invested in Miners for the long run in my humble opinion. Leverage is optional, based on your entry, risk tolerance, etc.
Now let me show you something else that can be considered BULLISH if it is about to repeat…
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DO YOU REMEMBER?
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For some of my newer readers, this is something important that I shared with my readers when they were about to release the FED MINUTES on May 22. This is the FED schedule. NOTICE Again that MAY 1 WAS THE FED MTG, MAY 22 WAS THE RELEASE OF THE MINUTES OF THAT MEETING. **2 important dates, because we want to remember what happened at that time. MAY 1 & MAY 22.
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I actually used this chart when they were going to release the FOMC Minutes on may 22, to show that GDX ACTUALLY BOTTOMED THE DAY AFTER THE FED MTG on MAY 1 . IMPORTANT: GDX SOLD OFF ON FED WEDNESDAY, but BOTTOMED THE NEXT DAY. I then said that when they release the FOMC Minutes- GOLD & GDX might bottom again. WE should watch for that…
This was the release of the FOMC Minutes on May 22. GDX actually dropped again, but that was the next low. GDX DROPPED ON FED DAY & FED MINUTES, but only for a day. So now we have June 19th FED MTG, and we could drop to break the 10sma, but how long will it last?
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I am just sharing an observation that shows how the FED Decision & Minutes was received in May. We were at the lows and due for an ICL, and the reaction was Bullish for GOLD & GDX. THAT MAY HAPPEN AGAIN, but I should also recognize that we are now extended & not at the lows, so it MIGHT pull back a bit more than the last time. If it does, it is not bearish. The precious Metals reacted bullishly to the MAY FED. If the Fed doesn’t cut here, we could see more of a drop, but it is just a normal dip. So if you can ride some volatility, that is most likely what we have in store.
YOU NOW HAVE TIME UNTIL 2 P.M. TO LIGHTEN UP BEFORE if you want. Maybe locking in gains makes you more comfortable, but my recommendation is to hold at least some positions in Miners. You can drop or keep your leverage since that is a persona l risk choice, but in this sector – at this point – this really could go either way. I’ve pointed out how in the rally of 2016, GDX hardly pulled back for more than 2 or 3 days. Other rallies did have pull backs. In the long run, Big Picture, my weekend report charts are what I expect and you don’t want to completely lose position.
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Enjoy your Wednesday Trading – or – Go for a walk to avoid the noise 🙂
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~ALEX
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AUY – Tuesday saw AUY break bullishly above the 50 sma, so the laggers are beginning to play catch up as expected. I have drawn a ‘possible path’ based on resistance.
The FSM reversal double bottom low in yesterdays report…
FSM – The follow through ( Laggers are playing catch up).
VGZ – VGZ gapped higher, dropped to the 10sma, and found support. I like that.
I do like what I continue to see the individual Miners doing. ‘Buy the dips’ on the stronger Miners like KL, MAG, AEM, AU, KGC, etc, and you can start positions on the laggards .
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CLF – Breaking the 50 & 200sma is Bullish, this was posted after Bill mentioned it in the trading area about 1 hr into trading.
AKS – Commodities are acting bullishly again, and Steel stock look good.
STLD – STLD actually popped 10% off of the lows with strong volume, so this is another sector perking up as the USD looks to be slowly rolling over.
HBM -HBM is a copper stock popping up to the 50sma, and TGB was mentioned yesterday. It may crawl sideways here, but I’d put it on a watch list. Buy this if it keeps acting correctly. If I lose track of it and you like it, remind me later by email or live trading area and I will draw up a chart for it ( or any of these).
TWST – We traded GH & TWST for some gains, but then they got into a consolidation phase. This was the buy near $21 in March …
TWST pop & run at $28…
TWST – Ran to $34 but dropped FAST. Trailing 10 sma and trend line stops would be triggered, and Now it based out and looks ready to run again. I actually wanted to buy this , but I am watching the FED & MINERS , and want to stay focused.
SNAP – Recommended May 29 since SNAP was resisting the selling
SNAP – I posted this on June 6 as follow through, and then it paused into a bull flag type move…
SNAP – That bull flag type sideways move is breaking higher. I did a target chart, and I get $18+ conservatively, $21+ as a healthy run.
There are other trade ideas, but it is FED WEDNESDAY. Sometimes it is best to focus on the ‘Market-Mover’ at hand, and then make some trading decisions after.
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REMINDER: You will hardly notice it, but I am going to be away next week. I will still try to get the weekend report out by Saturday, but I am flying that day and it may get pushed to Sunday. I will still have each morning report as usual, but I will be unable to spend as much time in the live trading area. I will check my emails at least twice a day, in case you have questions that are somewhat time sensitive. In the past when I have gone away for a week, most do not even notice the difference. It is the live trading area that I am absent from the most.
