January 16th – What Launch Pad?

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To begin, Gold did NOT close above the 10 sma to confirm a Daily Cycle Low, but the Miners did. Miners are leading Gold & Silver as seen on this updated ratio chart, so the Miners may be sitting on the launch pad. We’ll discuss that after a quick Market review.

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NASDAQ  – No change here, but we did see some selling into the close, after Phase 1 of The the ‘ Chinese Trade Deal’ was signed.    Will this become a ‘Sell The News’ event?  We’ll see, but on this chart you can see that we could still go higher if we simply repeat that last daily cycle  run.  See the chart & cycle counts.  IF SO…

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VIX – It might allow more time for the VIX to bounce around this wedge, but 12 is often a toppy area and eventually the VIX will pop higher and the markets will pull back. For now your 13 sma keeps you in the trade.

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WTIC – Oil sold off after the inventory report, but started to recover. Oil could be putting in a dcl here with a trend line break & possible recovery soon.  XOP & XLE remain the same as mentioned in yesterdays report, so this area could become a buying opportunity very soon. I’m watching OAS, LPI, DNR, WLL, and others for clues, charts were shown in yesterdays report.

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IN YESTERDAYS REPORT I WROTE: GOLD  – This reversal candle in Gold may bounce & start to run higher again.  That was a hammer candle (reversal).

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GOLD  –  With the reversal candle forming on Tuesday, Gold did push higher and is pushing on the 10 sma, but it did not get above it.  GOLD at $1557 breaks the 10sma today,  however…

 

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GDX – Midday GDX started pushing on the 10sma…

 

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GDX – I posted this at 2:30 Eastern saying that with a trend line break & 10sma break, we could have that swing low being confirmed.  You really would rather see it close like this, but at this point you can at least buy with a stop. You also could have bought the reversal on the 34 sma, but that is a bit riskier until follow-through buying occurs.

 

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GDX – At the close we have that break & close above the 10 sma, so this looks like a dcl.  Notice how quickly the selling from the past 4 or 5 days is disappearing. Another day or 2 could see Miners back at the January highs.  And finally, do you remember when…

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DO YOU RECALL? In the weekend report I used this chart and mentioned that we could look for a lower low this week followed by a reversal. I used this chart to show how we saw that before in the purple squares. Well…

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GDX WEEKLY-  So far, Our current weekly chart looks just like that chart.  If we close in this area (or higher is even better) by Friday, we have a great looking weekly chart again. The weekly MACD is about to cross, so this is looking like a buy to me.

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AND THEREFORE THAT GDX / GLD RATIO THAT WE LOOKED AT YESTERDAY IMPROVED TOO. This is a also further bullishness to encourage a buy with a stop for the Miners.

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Let’s look at a few Miners:

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GPL – GPL fell to new lows in December, but not only is it trying to recover now, it was leading the way  higher Wednesday morning when other Miners were still red.  GPL closed up 7.5% after a break out & back test of the downtrend.  GPL is a buy.

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HMY  – HMY is a Cup & Handle  and it could be bought with a stop under Thursdays lows.

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NG  -NG got choppy, but it really didn’t have a very big pull back. It looks ready for another leg higher now too, with Thursdays reversal.

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NEM – I thought that NEM would at least drop down to test the 50sma and support area, but after 1 big drop last week, it has recovered that drop & is back near the highs. It lost & regained the 9 sma, so it is a buy.

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GORO – GORO reversed on the 50 sma as support and looks ready to go too.  $5 to $7 is a decent trade, but eventually this should run even higher. Actually if you bought GORO at the last ICL, it is up 100%.

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PLG DAILY – Platinum has been running before Gold started higher, so I wanted to point out PLG.  It has recovered to the recent highs, has a short term target of roughly $2.25, but longer term the potential is pretty big.  Let me show you…

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PLG WEEKLY – With Platinum running strong, take a look at the weekly chart of PLG.  This is almost a 2 year chart, and…

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PLG WEEKLY – I can’t say how much of this path will be recovered, but the potential gains for this future climb is good if this breaks out.

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AG – AG is at the lows of a deeper sell off, but it reversed on the trend line and can be bought with a stop.

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The General Markets remained the same (Bullish), and We got what we were looking for in the Precious metals Sector, with a swing low in place.  It seems to be confirmed in Miners before Gold, so buying with a stop is encouraged.  With Energy we’ll need another day to see if we can get some upward movement.

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Enjoy your Thursday trading!

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~ALEX 

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TUP  – From a tightening base, Tupperware Popped and is a buy, since it can run up & fill that gap on the left. Use a stop under the lows.   This set up is very similar to the one pointed out yesterday  ( SHAK) .  If I see this I usually try to buy it right away, because…

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SHAK  – If the base has ‘shorts’ piled on & it breaks higher like SHAK did,  you can get a sudden short covering Pop.  This sold off into the close, but it can still run & fill that gap overhead.

 

SOGO –  On Jan 9 this was a buy under the 50 sma.  It then popped & moved higher for 2 days. Now…

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SOGO – With Wednesdays pause, I just wanted to point out the possibility of a back test of the 50sma. It can just keep running higher, but if you see what I have drawn taking place, some may want to start a position and others could add to a current ones if it does, but wait for a reversal at support.

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OSTK    paused too, and it could drop to the 10sma. Notice how it did that on its run from $9 to $28.  I’ll zoom in…

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OSTK would pop off of the 10sma and then spend a day or 2 sideways or down.  Then Pop again.  It did this over & over & over, so that MIGHT happen again.

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MORE MJ STOCKS – Note:  I try to buy them near support, because they move quickly. A normal pull back on these after a small run can seem big.   If you have never traded these, position size is Important.  Some should just start small and maybe add later if they run higher & eventually dip to support again. These move quickly, like leverage. They can run 15% on day 1, then 20% on day 2, then 10% on day 3, and then drop 15% on day 4 . You don’t want to buy on day 3 and ride a 15% drop down, so it is best to buy near support, wait for a dip,  or start very small.

 OR STAY WITH MINERS, TECH STOCKS , and maybe ENERGY STOCKS like DNR, LPI, OAS, etc are going to become buys after this pull back.

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ACRGF  – I posted this chart after buying it, because the set up looked ready to go, and the upside is very good. So this was a buy yesterday and it still can be bought, however…

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ACRGF  was up 14%  by midday, yet it hardly looks like it moved here compared to the upside potential. I say that it is still a buy because it didn’t break from this base yet, and when it does I think it can EVENTUALLY double over time ( If the MJ Sector has bottomed & continues higher).

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CNAB could be bought with a stop under the lows. That small pop is 16%.  You can buy these in the morning and sell them in the afternoon. Some of these smaller junior MJ Companies are probably best as short term trades at first.  Some may go bankrupt if they can’t sell product.

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CTST – I already bought & sold CTST, but it is a buy again. It made a higher high on the pull back to the 10sma. It now has a nice base.

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GRWG – I read the earnings report for GRWG, and they looked very good at a glance so I bought it.  I will summarize them in a moment. This MJ Company did not recent put in lows, its lows came in October while the sector crashed. Let’s view the weekly…

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GRWG – After bottoming in October on the 50 week ma, it has been climbing up that 50 ma.  This is now a giant base and I like this company as a buy & hold with a stop under recent lows.

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These are the highlights of the GRWG  earnings…

2019 Financial Highlights:

  • Revenue of $80.0 million, up $51.0 million or up 176% versus 2018.

  • Revenue for Q4 2019 was $26 million versus $9.1 million for Q4 2018.

  • Same store sales were up 62% for Q4 2019 versus Q4 2018.

  • Same store sales were up 36% for fiscal year 2019 versus 2018.

  • Total new store and acquired stores for 2019 totaled 11 new store locations.

  • Fully deployed ERP platform across all locations.

  • Up listed to the Nasdaq Exchange.

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KSHB  – Another nice long base that has KSHB Bottoming in October too.

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VFF  – I was watching this wedge at $5.80 and saw increasing volume in VFF, so I almost bought it, and then it popped and started to run. I posted this in the live area as a buy above $6…

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VFF  –  WHY POSITION SIZE IS KEY.  It closed at $6.36 and this is what makes things difficult. Is it a Buy? I think it is, but it COULD also drop back to $6 and still be fine.  I’d hate to call it a buy, have it pop to $6.50 & YOU Buy it, and then it drops to $6.00  That kind of action is difficult, but honestly this looks like it could run to $9 pretty quickly. Start small and add on future dips? That is an option for any no longer right at support.