Tuesday October 22
SPX – The SPX held up on the 10 sma as expected, and many stocks in the Tech Sector continued to look healthy, so on day 12, we’ll just keep watching it and raise stops to slightly under the 10 sma if you want.
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WTIC – The analysis for Oil, now on day 12, remains the same… Choppy.
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NATGAS – I sold my NATGAS position, because it was a leveraged position and I just didn’t like that it wasn’t acting as I had anticipated. I was looking for a possible break through that 50 sma sooner than later. The drop was unexpected and I wanted to get out of leverage.
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XBI – I recommended LABU last week and both XBI & IBB are breaking above their 50 sma. I also saw many Biotech & Pharma stocks that I follow up 4-6% Monday. I have mentioned TWST, GH, IDRA, and a few others and I will point out a few more later in the report.
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MJ ETF – this sector has been beaten down relentlessly, and I CAN’T SAY FOR SURE whether that has stopped or not, but I do see many with Higher lows and even inverse H&S patterns, so this is the MJ ETF. It has a nice volume set up and bullish indicator alignment. I have the 8 ema & 9 sma holding up price on this chart. It could be bought with a tight stop( But I do think that ENERGY & MJ are choppy and tricky, so keep that in mind).
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USD – The USD had a reversal and day 26 is pefect for a L.T. Daily cycle.
– Gold, Silver , & Miners dropped.
– I have been thinking that the USD bounces & back tests the 50 sma, and then
– Gold drops to the dcl ( ICL?).
– When the $USD rolls over after that back test, then
– Gold can move out of that DCL ( ICL?).
This could all happen around the FED MTG Next Wednesday, give or take a day or 2.
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PRECIOUS METALS
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GOLD – Gold has a failed daily cycle with a day 10 peak. I see it on day 29 now, and these daily cycles often go 32-35 days ( roughly). We really need a sharper drop to satisfy what I’m looking for in an ICL. I WOULD HATE to get a simple dcl, weak bounce L.T., and still have the ICL ahead for November / December . THAT will be a possibility if this just drifts sideways, so I wish Gold would just plunge lower & get this over with.
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SILVER – Silver broke higher Monday pre-market, and then sold off. I captured this chart in the morning for the live trading area.
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GDX – GDX & GDXJ opened Green and sold off all day. This would be another good area to sgort it, since you have it rejected at the 10sma , as expected, again. It MAY HAVE bounced to the 50 sma, but at this point ( day 26) , I think that it will just be too heavy.
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HMY – I have been saying that I like HMY, EGO, MG, DRD, and there are others. HMY was rejected at the 50 sma. Can it drop to the 200sma? Maybe, maybe not, but it is on my watch list when the lows are in.
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SBGL – Was that a 1-2-3-4-5 waves higher, followed by a bearish engulfing Monday? My indicators showed weakness at the new recent highs , so it does look ready to pull back. SBGL has been strong, so it is also possible that it might just be a gap fill to the 10sma too. A drop to the 50 sma would be nice.
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HL – Nothing has changed with Heclas pinch between the 200sma & 50 sma.
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EGO – EGO had a very strong run, and finally started to give up the gains. It dropped from $10 to $7 so far, but it may have another leg down too, sort of a 5 wave drop.
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JDST – Closed at $17.15, and this looks like a bullish set up. Back when I bought it under the 50 sma, I expected it to run to at least $20. It could even push higher, depending on how much momentum the selling in Miners has to it.
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So that is the current market update, and I will also briefly discuss several stocks listed below . One thing that I do want to remind everyone of, is that Miners should be seeking out their next DCL ( Possible ICL) this week, maybe into next weeks FOMC Mtg. THAT could be the BEST buying opportunity for the rest of 2019, if it is an ICL and not just one more daily cycle. That said, some may just want to patiently waiting for that dcl to arrive, rather than to take other trades & tie up funds. The choice is yours.
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Enjoy your Tuesday trading.
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~ALEX
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FIT – I am still holding FIT off of the 50 sma, and I expect it to continue higher as it rides that 10 sma & is still at the 10sma.
TSEM – TSEM has worked out well, and has cleanly climbed that 10 sma. This trade does have a $25 target, but if you took the trade as it broke out, you can just raise a stop under that 10 sma loosely too.
AMD – I recommended AMD when the SOX turned higher. It is also riding up that 10 sma cleanly. This could run to former highs of August and then we’ll see how it looks from there.
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TTWO – TTWO has been a strong stock, and just recently lost the 50sma. If it recovers it, this could be a small cup-like consolidation ( Continuation).
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SNAP – SNAP possibly formed a bull wedge & broke out Tuesday. Watch for earnings if you wish to buy any stocks over the next few weeks.
SNAP – Snap is very oversold also.
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For those MJ STOCKS like ACB, CGC, TLRY, APHA, HEXO, etc This is what I am seeing. You can watch this play out or take a small trade if you are interested. They could be bottoming, but we have seen these bottoms give way in the past. Waiting for a higher low is another possibility…
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ACB – It seems to have broken the down trend line & then back tested it & reversed. That would be a higher low reversal, and a move above that 10 sma could be bought with a stop.
TLRY – I drew this this weekend to answer a question from an email. It looks like a wedge possibly breaking out with good divergence. How did it trade Monday?…
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TLRY – TLRY HAS DIVERGENCE. IT ALSO HAS A REVERSAL AT THE DOWN TREND LINE, AND CLOSED ABOVE THE 10 SMA. Start a small position? Just watch it? leave it alone? It has been tricky.
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CTST – CTST is pinched between the 50 sma & 10 sma, with the RSI looking strong after MONTHS of weak RSI. This tiny 3 day pop last week was a 100% move, so please remember how quickly they can POP OR DROP! They have taken action to regain some licences that they lost.
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HBM – Copper stocks have been bullishly set up. HBM may back test that trend line or 50 sma & a reversal would be a lower risk buy.
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CLF – Some Steel stocks also look to be bottoming. With the USD poised to drop after a bounce, the industrial metals may be ready to rise too. CLF has been choppy, but we can watch for a break higher above the 50 sma.
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BIOTECH – We used to trade a few of these before the Biotech / Pharma sector got crushed recently. Now we see IBI , IBB above the 50 sma, so I wanted to revisit a few of these & see if they are bottoming.
GH – Last week I mentioned GH & TWST as 2 prior runners that may be bottoming here. This sideways move by GH gained that 10sma for the last 5 days and GH ran from under $60 to $68 already. There is overhead resistance with the moving averages, but we’ll see how it acts when it gets there. It can be bought here too.
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CRSP – Gene Therapy Stocks were hot a while back, and we traded them here. They look to be perking up after the recent sell off too. So here CRSP is popping above the 10sma and looks to be heading to the 50 sma. It MAY just be a short term trade, let me show you the bigger picture…
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CRSP – You can see that it broke the uptrend and lost the 50 & 200sma on the recent deeper sell off. We are right at the 200sma and it may recover that and run to the 50sma & a back test of the up-trend line.
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PRTA – Another biotech stock that is trying to get off the bottom. It has been choppy too, but that could be a small base that formed. It broke above the 50 sma & could run to the $10 area. It can be bought with a pretty tight stop.
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GOOD TRADE GONE BAD?
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TOPS – This is a trade that I have been in since the first week of OCT. It was forming a round base and riding the 10 sma very nicely. We would see 1 good day up, then 2 days sideways, 1 good day up, and 2 days sideways. Yesterday it closed just above the 10sma and looked like it could surge higher through the 50 sma, but…
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TOPS – In after hrs, this chart shows it down almost $1 (See the blue square). It says that the last trade was at $3.26. A MOVE LIKE THAT WILL ERASE ALL OF MY GAINS 🙁 I could not find any news, but ‘Contrarian Devil’ in our live commenting/ trading area said that he heard this “They filed a prospectus, after hours, for potential future dilution of their shares for up to $200M. Knee jerk reaction so far.“
