Friday Oct 4th – Timing

 

SPX FROM YESTERDAYS REPORT– Day 41 is late, we are due for a dcl, but we are still waiting for a reversal and a swing low. The 2822.12 is very important here. That is the last DCL Number.

 

THIS WAS SUPPOSED TO BE IN YESTERDAYS REPORT TOO–  I was trying to point out that often a large gap down after a sell off can flush the markets as sellers all rush for the exits.  So we could be close to that dcl (low)  for that reason too.

 

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SPX – We did see the markets sell off in the morning and the lows from yesterday were taken out on more bad news. CNBC was reporting that the “DOW HAS LOST OVER 1000 POINTS THIS WEEK!!”  and suddenly… the markets started to regain their buying & we ended with a nice reversal. Look at that reversal on this chart.  I posted that I bought the SOXL and will explain the trade shortly. Noteworthy: The opposite happened to Precious Metals.

 

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SOXL INTRADAY – The sharp sell off broke the lows from Wednesday & then recovered.  I was watching for a stop run & recovery at this point & price bounced and held support. Notice the downtrend line ( blue) .  I had to leave for a few hours, but expecting a DCL,   I set a buy at $158  only if it broke the down trend line at $157.  It did and ran off higher.

 

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FROM YESTERDAYS REPORT: I wrote   QQQ – the Q’s also are at an area that has previously acted as support. We are looking for a swing to go long if you want to be long the General Markets. ( TQQQ, SOXL, UPRO, etc are leveraged etfs and could be traded short term.

QQQ  – The NASDAQ dropped & reversed too, pushing QQQ back above support.   Note: Look how weak that last daily cycle was for tech though. It didn’t even break the highs.  We’ll see how this one does, I think that the markets may be slowly dying.

Note: The Friday Jobs Report  C-O-U-L-D Drop the markets below todays lows again, similar to what we saw on Thursday morning.  If I had entered a trade Wednesday, it may have stopped me out & reversed higher.   That said, I started thinking that I  need to decide how loose or tight I want my stops to avoid losing position, but also remain safe in case a real waterfall sell off developed.   Anything can happen, but we are late timing wise, and this reversal Thursday does seem to be a great chance of becoming the DCL.

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WTIC  –  Oil put in a strong reversal on day 40, so this may be the DCL.  When a drop is as steep as this one, I don’t wait for the 10 sma, I look for a trend line & may use the 8 or 9 sma  ( 8 ema). In technical analysis,  this reversal could simply be bought with a stop at the lows, especially on day 40.

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XOP  – So we see the reversal in the Oil & Energy stocks too. That sector could now start presenting safer buy opportunities.  Check your Oil / Energy Stock list and see how they act tomorrow.  I bought GUSH on this reversal.

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GOLD  INTRADAY –  Gold surged over $16 and really looked convincing again,  Miners followed but quickly looked unconvincing again. As Gold ran higher,  it tagged that trend line area and pulled back…

 

GOLD  DAILY –  So GOLD has pretty much reached the upper trend line & sold off, but you can see that it could go a bit higher too. Fridays Jobs report  M-I-G-H-T Drop the markets and POP Gold again,  but I think we will see the same results that we saw on Thursday if it does.

 

 

 

SILVER   – Silver didn’t even move above the 10 sma Thursday before pulling back.

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THIS IS WHAT WE HAVE DISCUSSED FOR EXPECTATIONS IN PRIOR REPORTS:

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GDXJ INTRADAY    – So I pointed out the 10 sma as GOLD popped and Miners joined in.  I have been mentioning that if this plays out this way, Markets will DCL & Run higher for at least several days. Miners should drop into a dcl / ICL and this area would be where one could go short.  IT IS VERY HARD TO SHORT A BULLISH SECTOR.

 

GDX DAILY – So GOLD ran up almost $20 AGAIN,  and GDX simply tagged the 10 sma and dropped on day 14, with a day 7 peak. If the markets rally after the Jobs report, Miners could continue their sell off. I sold my SBGL & DRD Positions, thinking that this bounce may be tired already. I am Short.

 

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 What a difference a day can make in the appearance of different sectors. Yesterday it was hard to find a proper set up ( except for the MJ Stocks & MJ Sector). Today we had strong moves in one direction,  reversing to the opposite direction, and many stocks have reversal candles that look ready to move higher.    That alone isn’t enough, but we are late in the timing for a DCL,  so we were looking for a reversal and got one with more bad news.  We discussed LABU & The MJ ETF as leading with reversals yesterday. They followed through today.

 This will be a confirmed as a DCL after we get a swing low & move above the 10 sma, so the lows could actually be taken out again,  like yesterdays lows were, during the JOBS report. I feel strongly that we will get a better reaction higher after the jobs report.   If the Markets do drop, we are still expecting a low very soon , my stop will only be a mental one.  If we do get a Jobs Report ‘surprise to the upside’ in the Markets, we could also see the selling in Gold & The Miners resume.  We’ll just have to wait and see.

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Enjoy your Friday trading!

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~ALEX

 

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Just a few trade ideas at this point,  since it is Friday, the last day of trading.  After the Jobs report, more set ups may present themselves.  You can watch your watch lists of TECH, ENERGY, MJ Stocks, etc as the day progresses.

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BIDU – Bidu is a Chinese Stock, so one would expect more risk, but I have been seeing many base out and recover. This actually looks quite Bullish if it breaks the 50 sma, and notice what it did while the markets crashed Wednesday & Thursday.    Buy with a stop.

 

SQ   –  I pointed out SQ as it broke above the 10sma, now we see a higher low & reversal on the 10sma that filled the gap.  This is a buy since the tech sector looks ready to go higher too.

 

TSEM   – TSEM has not been selling off with the markets over the last few days, it found support at the 50 sma and buyers stepped in while the Markets crashed.  THAT Sounds bullish, this is a buy. Last earnings release was July 29.

 

 I discussed the MJ Stocks as reversals looking for follow through, similar to what we saw with CVSI.

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ACB – was up 8.5%  Thursday, after going RED at the open. Volume is good and now I’m hoping that it can just push through the 10sma  (CVSI did).

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HEXO   –  Here is a triple bottom for HEXO. These are low risk entries, with solid reward possibilities.  If the sector gets really bullish again like we’ve seen in the past, they can run back to former highs.  Buying here gives you a stop right below.  Risk / Reward  is strongly in your favor,

 

OGI   – VERY HIGH VOLUME, but price did not sell off. That is often a sign of a good move after a prolonged sell off.

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CRWD – This is a buy, $60 to $100 anyone?

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ROKU – ROKU may break the downtrend Friday too.