September 1st
SPX – We are due for a dip into a dcl, and actually we could be considering this late. I’ve mentioned the strength in these markets in recent reports. The dips are minimal so far, and it feels like a runaway move…
NASDAQ And the NASDAQ has only seen drops that last a couple to a few days. 
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The weekend reports have reported on the Big Picture as a possible blow off top that ends badly. Those runaway moves cannot be sustained indefinitely. This looks steeper than the 2000 Tech Bubble, so even though I am long certain positions, I am cautious the longer this goes on.
XOP AUG 25th– I mentioned that I feel that the XOP needs to drop into a dcl, so it was no longer following Oil, even as Oil broke rather bullishly above the 200sma.
THE XOP dropped on Monday.
IN MY WEDNESDAY & WEEKEND REPORT, I talked about the Bullish set ups in Miners. I admonished keeping a ‘cautious ‘ stance, due to the possible timing of the daily cycle, since a left translated daily cycle could roll over. We may not get a L.T. Daily if this intermediate cycle stretches. So basically, it was fine to buy the dcl over 2 weeks ago, then we saw upside chop and sideways chop. The set up still looked pretty good again as of last Wednesday into the weekend, I pointed out several Bullish Miners. On Monday, I did see a little less strength in Silver Miners, so I will need to just point that out and we’ll have to keep an eye on things Tuesday and see if it continues.
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We are also 5 & 1/2 months out from the last ICL in March, so a dip to an ICL could come due at any time going forward. Can price rise in this daily cycle and then have the intermediate cycle stretch to 7 or 8 Months? Yes, so I mentioned buying the dcl and I look for signs along the way. It has been choppy at times so far, set ups still look bullish.
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GOLD has what looks to be Bullish looking set up as it tries to break a down trend. This is Bullish, but please notice what happened in May. Gold broke a downtrend, was due for a dip, and rode that trend line down. That is worth taking note of to keep us alert to possibilities.
SILVER broke the downtrend and looks stronger than Gold. That is also bullish, however on Monday I saw many silver miners push higher & then sell off into the end of the day. That isn’t eerily bearish, but it is worth taking note of going day by day. Let’s watch the Silver Miners Tuesday.
GDX – We discussed buying that dcl over 2 weeks ago and seeing how it plays out. GDX has a higher low and appears to be trying to break that down trend too. Up less than 1%, Miners lagged the metals a bit.
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SILJ VS SILVER is actually not bad and the MACD looks promising, so lets see what Silver stocks can do Tuesday & Wednesday. This chart is rather neutral, and GDX vs GOLD is similar.
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I want to take a quick look at 2 silver stocks, so you understand what I am seeing, and then at the end of the report I will do a larger overview of our Miners by request.
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HL is an example of how SILVER pushed higher all day, yet some of the Silver Miners ran up & then sold down into the end of the day. Watch for a break of the down trend Tuesday. If Silver is up Tuesday, we want these to break out.
EXK gives us the same picture. Overall, this is still a bullish set up, but if Silver runs and these lag, that could be a sign of weakness that we need to take note of.
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I will discuss more about Miners at the bottom of this report, and I will also point out a couple of trades.
Enjoy your Tuesday trading!
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~ALEX
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WKHS – I have been pointing out that I bought WKHS and like the set up / consolidation for over a week now. I said that this one is a ‘swing trade’, one that you hold for a while until it breaks one way or the other, but it is a bullish set up in a strong sector ( NIO, TSLA, etc).
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WKHS popped over 14% Monday with good volume, and closed up 10.5%. I’m looking for follow through, since it has Popped & dropped through out the consolidation.
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BLDP – Another swing trade that popped and chopped sideways, but it did push above the 50 sma again on Monday. I’m ready for that run to $21 🙂
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WRN – I bought this consolidation Monday, since HBM, TGB, FCX have had a nice run. I discussed the bullishness of those Copper stocks in a July report and several have done very well since then. I would like to see WRN play catch up.
EVFM – I bought this when I saw the flat base and volume started to build. This chart was taken Midday and posted in the live area below the report. It closed in this area with twice the volume. I think that it can run quickly if it can get over $3.50. This is also one of those possible pop & Drop & pop & Drop , etc bases.
NIO pulled a sharp reversal after a break out & back test type move. It is possible that it now want to continue higher.
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WORK– has broken above the 50sma and looks to be on its way to $40.
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I have been asked to cover the pull back in Miners. “Why aren’t we dropping? Will we skip an ICL?” was the question. The answer is in short is, “We have dropped into a dcl, and this daily cycle is still in play. It can continue the rally or stall and roll over. That takes time. “ I will show that drop into the dcl in the section below.
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FIRST I WANT TO POINT SOMETHING OUT WITH SILVER – Notice that it had a CRASH Low as the dcl, and then a much higher low last week. That is easy to see as a daily cycle low and a higher low…
NOW NOTICE THAT WITH MANY SILVER MINERS, LIKE HL, We saw a small drop on Silvers crash low, and then a deeper lower low last week. I find that odd, but at this point I don’t know if it really means anything. One consequence of that move is that Silver had a higher low last week and was able to break the down trend after last weeks higher low. Several Silver stocks haven’t broken out yet after that lower low last week. Just an observation. I want to see if they break out Tuesday or this week
EXK – I see the same thing here with EXK. So we had Silver itself hold up nicely last week, but these Silver miners sold off quite a bit. Just an observation, but it seems noteworthy. And as you can see, we have had a sell off Since I sold my Miners.
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AXU also dropped with Silver, but last week made a lower low also as Silver held up.
If I ignore that observation, I just look at AXU as a Miner that dropped to the 50sma again, found support, and is moving higher again. It looks like a bullish repeat of May price action. So this drop was similar to what it did in May with a double top & drop to the 50sma.
SSRM Did crash down with Silver and then tried to put in a higher low. Let me show you something about some of these Miners, since I got an email asking why…. ” .. the Miners aren’t selling off?” …
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SSRM has had a pretty good drop here from $25 to $19.
If I owned 2000 shares of SSRM, and it drops from over $25 to $19, I’d give back $12,000 in this one stock in 1 week. If I own several stocks like this, and they all drop that week? I could watch $30,000 of gains vanish. I just needed to share that thought, because one reader feels that Miners haven’t really pulled back . Let’s take more of a look at that.
Some have not pulled back all that much. CDE did drop $1.50/share, but now appears to be forming a high bull flag at this time. It still may drop further, but I’d agree that it is holding up well.
AEM and this is the same, but I am finding these to be somewhat rare.
AU dropped $38 to $27. If you only had 1000 shares, your account value saw $38,000 drop to $27, 500. That is about an $11,000 drop. If you had 2000 shares, thats $22,000 down, plus if you were holding other Miners that pulled back. These DID drop into a DCL.
NEM dropped $72 to $62 in 4 days. A $10 drop, not too bad for a $70 stock. It doesn’t look like it dropped very much, but this was a drop to a dcl, not an ICL, there could be more to come.
ELYGF – I actually love this stock, but it too lost $1.50 to $1.00. Miners have pulled back. If a box consolidation has formed you could buy it low.
In fact, I mentioned that Box formation a week ago with this chart, and price today is exactly the same. If you want to accumulate ELYGF in this $1.10 – $1.20 area, that is fine.
SPAZF is a great little stock too, and it had a strong run from July to August. It didn’t drop? It too dropped 58 cents to 33 cents. Riding that down is big if you own a large portion. That is over 40% drop from 58 cents just last week. The STRONG REVERSAL helped recoup the drop, but it dropped.
TDRRF – Tudor took a big drop into last week too, yet it has almost recovered. If you own 5000 shares, and it drops $1.40 ( $3.40 to $2), your account watches $7000 go away and start to recover, so we can’t say that they haven’t dropped. Remember that the Miners drop all happened at the same time, so your account could have lost $40, 000 of your gain on those couple of ‘down weeks’. A Bull will recover the losses, so IF YOU CAN TAKE THAT KIND OF RIDE, go ahead and jump in. If not, buy the dips 🙂
TDRRF – The big picture of TUDOR is stellar. Buying at May near 50 cents and riding it to $3.40 would have been great, the drop would be giving some gains back, but you’d still be up a lot. If you started piling in during July however? You made it and gave it all back ( $2 to $3.40, and back to $2.00) and now its coming back again.
WLBMF – So you can see that we are getting the pull back in all areas of the precious metals sector, both in the Majors and the Juniors and explorers. Some are bouncing back quickly, others are not. We are in choppy times and that is the hard part.
So my point here is to help the readers see that these Miners can & DO pull back, and this was just a dcl. They have become choppy, but the set up in this daily cycle low looks constructive and bullish, I pointed that out last week and in the weekend report. Now we CAN see if this set up extends the intermediate cycle and it can run to new highs again, or if it may Double Top & Roll over, we just don’t know. That is why the admonition was to buy with a stop & let it play out. My point here is that when a dip to an ICL comes, ANY OF THESE MINERS can take a good pull back. Some can cut in half the run that they just put in. Some of these drops were healthy and it was just a DCL drop. If you can ride that out, that is up to you. You can just get back in now and ‘ride it out’ .
Some can stomach it , others get an upset stomach when their accounts go from $50,000 to $35,000 or $80,000 to $55,000, or $10,000 to $6,000. It may not look like Miners pulled back much, but when you do the math? ICLs can do that. I personally lock in gains after 3 daily cycles, buy the next dcl and see if that next dcl can run or rolls over. THIS DCL has bounced, chopped, and many have chopped sideways (some have pushed higher quickly just last week), others are at a downtrend line. Now they look somewhat constructive. After my reports last week and this weekend, you may have even done more buying, I had miners in those reports. Now we see how this plays out.
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EDIT: Tuesday morning: Today is a perfect day for this discussion. Let’s see what Tuesday does, especially with SILVER MINERS, since Silver is still pushing higher and our Silver stocks should gap right over those down trend lines. Some Gold Stocks are set up similarly to the THEME PIC of this report.
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THIS WAS IN THE WEEKEND REPORT
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August vacation is done this week, are we going to see buying in Miners next week? I pointed out last week how similar these set ups are in GDX, and the last one started a nice rally. Is Gold just going to go parabolic and do a stretched intermediate cycle? We are almost 6 months from the last ICL in March, but anything is possible, including an 8 or 9 month Intermediate cycle, so lets stay alert.
