October 8th – No Forward Progress
On Monday the markets were all over the place, as you can see from the intraday chart below. In the end, if you were long, you saw no forward progress, so you will see why that is todays theme…
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SPX INTRADAY– The markets went red at the open, then they rallied back. They drifted lower midday and suddenly surged into Green again, only to sell off into the close. Mondays trading was choppy, so…
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SPX – We had no forward progress here. This should be day 2, but we did not close over the 10sma or break the down trend to confirm that yet.
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WTIC – Oil popped & dropped , so we also do not have any forward progress in that sector ( I am not in any Oil positions).
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NATGAS – I own a NATGAS position, but it dropped on Monday after tagging the 10 sma. That means that we also saw no forward progress here, and the dcl is not confirmed yet. We could get a drop as shown, but that line is where a stop would be, and you can raise your stop, but a drop as shown may stop you out. (You could re-buy if it gets over the 10sma to confirm the low).
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MJ ETF– Even the MJ ETF tagged the 10sma and dropped back, so we saw no forward progress here.
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GOLD – Gold put in a doji, and according to this chart , it still closed above the 10 & 50sma, however, it did NOT close above on another charting service that I use. Let’s take a look…
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GOLD – This service shows Gold under the 50sma, and the 10sma was above price too. Gold made no further progress, but I’m glad about that, since we are expecting a drop into an ICL. THAT should lead to a nice long opportunity in Miners.
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SILVER – Silver tagged the 10sma & dropped, making no further progress.
SILVER – This is just an idea of what we may see as this sector drops into an ICL. This means that it can just drop from here, or it may bounce, but so far the 10 sma capped it. The ICL will be an excellent long opportunity.
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GDX – GDX made no further progress (thankfully for those in JDST), and it closed under the 10sma again. IT CAN BOUNCE to the 50sma & that trend line, but as time moves forward it will likely seek out the DCL/ICL more quickly.
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So you can see that Monday was choppy, sloppy, and made no forward progress in any sectors discussed. We’ll have to see what Tuesday brings, because we had many reversals last week, and they were within the timing for a dcl, but we do not have confirmation for those waiting to buy a confirmed dcl.
As mentioned before, I have family in town for the week, and it is seriously limiting my normal trading ability, so I am thinking that I needed to make a few adjustments. I will discuss that at the bottom of the page for those that care, since some follow what I trade and they want to know why I would make changes. If you didn’t follow my trades, then you probably do not need to read what is below. I think I was over-positioned for 3 reasons, and I’ll discuss the reasons for that.
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Enjoy your Tuesday trading!
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~ALEX
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3 reasons that I needed to adjust my positions, but you may not need to…
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1. We do not have confirmed DCLs yet, but they are due, so that alone doesn’t bother me.
2. I chose to add leveraged etfs, and I’m usually fine with that too, but…
3. Now add the first 2 reasons to the idea that I am away from my screens most of the day & using my phone is not always possible, so as a personal choice I made a few changes.
I am still in UGAZ with a stop, because I like the August ICL, and that this may be the first dcl. My SOXL position was up $13 from my entry, so I locked those gains in to offset this dip in MJ & UGAZ. If we get a confirmed dcl, I may re-enter. I also cut my MJ STOCK positions in 1/2 until I see the MJ ETF confirm a dcl. AGAIN, This is simply because I am flying blind.
In New England, We are experiencing a period of time called the foliage season. We are scheduled to take a day trip for that and it can be really enjoyable if you put the cares of the day aside. For those unfamiliar with that, I posted a link below, it really is beautiful. We’ll also go for a ride along the coast one day and do lunch, drive into Boston for a duck boat ride and anniversary Dinner, etc , so I am honestly finding that I am unable to check in very much during the day. Along with that, our dcls are not yet confirmed. If they were confirmed, I may just use a stop under the 10sma, but we are not there yet. I hope that this explanation helps most to see that you can manage our positions according to your current circumstances, and I had to according to mine. As I have always said, “A confirmed dcl is the safer entry for a trade.” I sold my SOXL around $174 for profit, but I think that it can make it to $200, so there is no urgency. I just needed to lock in gains for now, and possibly re-enter on a confirmed dcl, above the 10sma.
