Friday October 2nd – News Events

  EDIT FRIDAY MORNING:  I planned on having  Fridays report  simply be a large number of  Bullish Stock Picks. I’ve been  seeing a good number of Bullish set ups that could at least become good short term trades, and some may have even continued to be longer term plays, however we can’t dismiss the fact that BIG NEWS EVENTS can affect the markets.  News usually just initially causes added volatility and then the markets can begin to shake it off.  In other words, often News headlines will not usually change the Market direction in a lasting way. To do that, we’d need to see price breaking the lows ( DCLs) and changing the  whole set up , but really big news that stays in the headlines for a period of time could do just that.

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  Well last night the President of the US and his wife tested positive for Coronavirus.  News like THAT could change the markets longer term if it continues to add uncertainty to the Markets.  For example, what if many in his inner circle start to test positive?  And what if His health was greatly affected along with many at the White House becoming infected?  SO NOW WE NEED TO AT LEAST PROCEED WITH CAUTION and we should expect  some volatility.   We know that we are within normal timing for a General Market sell off into an ICL—IS THIS THE CATALYST?    That  news changes my feelings about this reports stock picks at least  in short term for now.  So what I will do is cover our markets and then add some of those Stock Picks or Set Ups that I already gathered Thursday night—and we’ll see if they continue to play out bullishly.  Also I’ll be watching the COVID STOCK PICKS and see how they initially react, especially since many have been setting up bullishly already ( BNTX, MRNA, NVAX, IBIO, ETC).  Lets look at the Markets.

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SPX – This projection is what we would normally have been expecting anyway. SPX got above the 50sma and now this would rally & drop as a sell off begins, or the blow off top market could have another strong leg higher backed by Fed Juice. WITH THE NEW NEWS AT THE WHITE HOUSE?

 

SPX – This kind of special News Event at the Whitehouse could remain in the headlines for a longer period of time, and if uncertainty continues to grow, we could get the major sell off that we have been discussing for a while now. We are late in the Intermediate Cycle.

 

WTIC has been weak under the 50sma and that continued.

 

 

GOLD did close above the 10sma and we should have a confirmed dcl. Now we watch this going forward and if this breaks above the 50sma & trend line, we could actually have the ICL in place.  Can the prolonged headlines of Covid in the US Whitehouse affect Gold?  We can’t rule it out, since we are late in the Intermediate Cycle at Month 7.

 

GDX also closed above the 10sma. The 2 directions shown are both still valid.

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So let me repeat what I said:  NEWS itself usually does not alter the long term path of Markets direction. We often see volatility immediately and then the markets stabilize after that initial reaction, but it needs to be said that we are Late in our Intermediate Cycles. That means that ICLs can be due time-wise and a prolonged ‘Event’ can affect confidence in the Markets and become a Catalyst for that low.  How could this happen?

  Lets just say that the ‘news’ starts to report that The US President becomes sick over the next week and even needs medical assistance 2 or 3 weeks from now.  Will the Markets remain Bullish and rally?  The markets hate uncertainty so we COULD see an ICL drop begin in the general markets since this is the 7th month of this Intermediate Cycle.  On the other hand, an ICL is due around month 6 or so in the Precious Metals.  Gold has bounced weakly out of the dcl so far.  Could we possibly see money go into Precious Metals as a safe haven & turn that dcl into an ICL?  Yes,  that could happen since it is already in a Bull Run, it already had a sell off , and it is 6-7 months from the last ICL.  A ‘News Event’ that remains in the headlines or even increasingly seems to get worse  over time can  change market sentiment and change the overall markets late in an intermediate cycle.  Since we are within timing for those hallmarks, we need to Stay tuned and  Stay Frosty!

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Enjoy your Friday trading.

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~ALEX

 

EDIT THESE CHARTS WERE COLLECTED  ON THURSDAY WHEN THE MARKETS WERE BREAKING THE 50 SMA:   So now I will put just 5-8 of the 15 Stock set ups that I had planned on adding to the report  I will repeat or add the cautionary note that it may be wise to just see how things play out with what could be a Friday with additional volatility. Will markets sell off? Will they sell off and recover by the close? We have to wait and see, but for now you can watch how these bullish set ups.  Again,  SOME COVID PLAYS (BNTX, NVAX, MRNA, even some of the smaller former runners like RGLS, BIOC, IBIO, etc )  MAY ACTUALLY IMPROVE.

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BNTX is a bullish set up and may continue that way as a Covid Play.

 

 

I’m going to point out ETSY, because I really liked this set up.  It is bullish and ETSY  can still stay in business with on line buying & selling . That said,  you can also see that they did experience selling  with the General markets as it sought out its dcl, so caution is still warranted. This was a Bullish set up that I would have highly recommended if the Markets hold up.

 

 

MIK is another retail stock that I would have highly recommended as a Bullish Set Up. It has simply done normal sell offs toward the 50 sma and it is oversold. If not for the current news event, this would have been a strong buy too.

 

CHFS: I wasn’t going to add this to the report, but it is Covid and moved , so I will add it here to be observed.  I captured  it 1/2 hr into trading yesterday as it started to increase in volume and started to rally , up 8%.  It is a double bottom  (COVID STOCK) that rallied nicely in March through July. It closed up 25%,  so we’ll see if these former Covid plays come to life again.  If so, I will be covering them in future reports. 

 

AGLE looks ready to break out and I expected that it could on Friday after a strong Thursday push with volume.  For now it can remain on the watch list, because this is health care and it may continue to find buyers.

 

BRP is a bullish set up too, since it just did a small shake out at the 34 sma and shot up 8% yesterday breaking that sell off downtrend.  For now I would just watch and see how these trade with the current market uncertainty.  You could just put it on your watch list of potential buys next week.

 

Green Power Motor Company perked up after putting in a higher low and breaking the downtrend.  It is in a sector that I thought could do well, but at this point I’ll be watching for a pull back and see how that plays out  (possibly another higher low?).  This – Moves – Quickly!

 

SGC did a shake out and then a new high break out.  That is a nice sign of bullishness, so I’ll add it to my check list with that note beside it.

 

SPAQ was a former runner that I (we) did very well with too, and then it sold down to the 34 & 50 sma again where it found support.  It started to look like it wants to run again, and I thought that it may break the downtrend Friday.  That would be a buy.