August 17th Thursday & Initial Jobless Claims
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THE NASDAQ was rejected again at the 10 & 50sma after the Fed minutes were released. We are now selling down into an ICL, and it may take another entire daily cycle to reach the lows (so you should be able to short the bounce).
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This was in yesterday’s report, and it is a chart from August 2:
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Back on Aug 2 (& other occasions), I drew the first dip to the 50sma and we are there now. I also discussed that an ICL is coming due, so we could bounce out of a dcl and then drop much lower to give us an a-b-c drop.
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So The SPX lost the 50sma with the fed minutes. A daily cycle low can form anywhere around here, because this is day 36, but this also does have time to sell off a lot more, since daily cycles can be 40-50 days long.
So we could see The SPX drop into a dcl (I’ll guess to the 38% retrace), bounce up into a L.T. Daily Cycle, and then drop into the ICL. That bounce should be short-able too. I have ‘scalped’ a couple of trades with SOXS and SQQQ, but notice how hard this is to short, with a down day, an up day, 2 down days, a big up day, a down day, an up day, etc.
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The SPX: Add the 200sma and it also lines up with the ICL low being at the 50% area.
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This was another SOXS buy on Tuesday…
And the follow through for scalpers of SOXS Yesterday. So SOXS has made a run from $8 to $11 , but it is extremely hard to short a bull, because you keep getting choppy intraday moves & pop & drops. If we get a dcl and a run up to a L.t. daily cycle though, you could buy & hold SOXS, SPXS, or SQQQ into an ICL.
YESTERDAY I MENTIONED:
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WTIC – Oil actually fell just a little bit more than it should have, so we have a slight change in character. It has been tagging the green 13 sma, but it fell to the 20sma on Tuesday & the MACD crossed lower. That may signal that a deeper dip is coming. A drop into a dcl could back test the blue 50sma and that yellow base, but that would be a nice buying opportunity for Oil Stocks ( or USO & UCO).
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WTIC -And here is the deeper dip that I was discussing. This could be a drop into a dcl now to the 50sma, and a reversal there could become a buying opportunity.
THE XOP or Oil Stocks didn’t quite follow Oil, so they may chop slowly lower to the 50sm and they’ll be a good buying opportunity too.
I know that this looks very bullish and it has been, but let’s not think that the USD can run up for 100 days straight and Gold will go to zero 🙂 . The USD could peak in this area and start to drop into a dcl, especially since GOLD & SILVER are due for a dcl. The USD is quite overbought.
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GOLD did break the June lows overnight, guess what though? I actually don’t think that I care since we are on day 34. If this was day 12, I might view that as bad, with possibly 3 weeks of downside left. Here, however, we broke the lows on day 34. We are due for a dcl and this may be a shakeout that lasts for a day or 2. On this chart, a break above the 7 sma is going to grab my attention quickly.
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SILVER is on day 36 and day 37 did not make a new low, so it may actually be day 1, we’ll have to wait and see.
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GDX broke down, filled a gap and made new lows with the Fed minutes release. I know that this looks very bearish, and many people MUST think that this is the death of Miners and the start of a crash, but on day 33 I have to think that the downside is limited.
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We didn’t get reversals higher in any sector with the release of the FOMC minutes, but we are very much closer to where the lows often come in using cycle timing. All we can do at this point is wait for that reversal and break higher, and we must be very close to that time in the Precious Metals Sector. Also, guess what happened with Bitcoin Overnight? I’ll write it up below. Enjoy your Thursday trading!
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~ALEX
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YESTERDAYS REPORT MENTIONED:
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BITCOIN should be close to putting in a low (near day 60) and that lower indicator did cross lower, so is one more quick slam down in the works? It seems possible. The Crypto stocks like MARA, RIOT, CIFR, etc closed below their 50sma yesterday, possibly anticipating that more time is needed. This chart is pointing to day 60 as the green candle, but it was really Tuesday, the red candle to the right of it. Today is day 61.
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BITCOIN actually dropped quickly and recovered on Wednesday night, day 62. This could very well be the final low that I have been watching for, but we need to watch for buyers first. If Crypto stocks like MARA, RIOT, WULF, etc pop back above the 50sma, that will be similar to wat they have done in the past consolidations. A shake out type of a move.
