Tuesday August 22nd
THE NASDAQ started to climb higher immediately, so I posted this chart to remind us that we may have a dcl, or it may just tag the 10sma and then roll over. Either way you can buy it with a stop and sell some at the 10sma, or trail a stop, etc.
So by the close we have The SPX with a swing low (unconfirmed). That was a day 38 low, so that is enough to give us the dcl, we’ll have to see if buyers push this over that 10sma.
I have mentioned a path something like this a few times, if the ICL lies ahead. This could be
1. A day 38 dcl and the next daily cycle rolls over into the ICL, or
2. We could roll over at the 10sma and have a drop to a day 50 ICL low. For now, we watch that 10sma.
THE SOXX has already closed above the 10sma, so it looks like a dcl may be in place here ( & the SPY & QQQ would also likely be dcls if the SOXX is leading).
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LAST WEEK I MENTIONED WITH THE WEEKLY OIL CHART:
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OIL WEEKLY – Oil was rejected at the overhead resistance. What concerns me here is 2 things:
1. We are at resistance and rolled back, and
2. This is overbought on a weekly basis and looks like it could drop further over time.
A breakout higher is a buy, but this may just chop and drift lower before it breaks out.
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On Monday Oil was rejected at the 10sma and could push even lower. This COULD be a day 46 dcl or a drop to the 50sma could give us a day 50ish dcl. OIL STOCKS are not dipping as much as Oil…
THE XOP is still at the highs with somewhat of a double top. There are other oil Stocks that did this too, as mentioned on the charts, so it is possible that Oil is very close to that dcl and these will just chop sideways for a few days as the 50sma rises up. Oil Stocks remained bullish.
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THE USD only dropped 7 cents and remained above the 9sma, but it is getting late in the daily cycle and it should start to sell off soon. That would help the Precious Metals, and they did pretty good on Monday with just that 7 cent drop.
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GOLD suddenly started to sell off relentlessly a couple of weeks ago, dropping day after day after day. A dcl is due with Monday making a slightly new low on day 36, and that new low quickly reversed. Hopefully we can get some follow through higher.
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GOLD That sell off was so tight, that I am looking for a close above the downtrend line as a bullish change. That would actually match the 8 ema or 6sma. In fact, if Gold closed at its highs today, it would have been a trendline breakout.
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And guess what? I’d LOVE to just say, ” Hey, at day 38 it is probably safe to buy this. We should bottom here or soon” , but we all know that as soon as I do that…
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We all know that as soon as I do that, we’d get a 2 0r 3 day slam down into a day 39 low. So I didn’t say to buy yesterday, but a push higher is Bullish.
Sure, even if it dropped like this the reversal would likely be V-Shaped and offer a quickly recover… BUT THEN NO ONE WOULD DARE TO BUY IT AFTER BEING FLUSHED DOWN THE TOILET LIKE THAT. So again, a move above the 8 ema or 10sma is the safer plan. I’m hoping that we’ll see that on Tuesday.
FROM THE WEEKEND REPORT:
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SILVER DAILY – I mentioned that Silver may have bottomed ahead of Gold again, because it refuses to break the lows so far. We are late in the count for a dcl and this is possibly already on day 3 as it hangs above the recent swing low. This chart has the same ICL characteristics that formed in June with a ‘new high’ and a ‘downtrend break’,etc. Silver DOES look set up to run higher next week.
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Hello Monday, and it certainly does look to be day 4 for Silver. I do hate that SILJ is not as Bullish as Silver, but that MIGHT be a gift! Silver stocks are hanging at the lows, and could be cheap buys with Silver looking like this.
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SILJ dropped and recovered, but closed break even. So is this the buy of the century with Silver already running? I like the volume on this reversal, so we should know soon enough.
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Silver rallied, Gold made a new low and reversed higher and GDX made a new low too.
I watched GDX reverse higher and posted this chart as what I planned on being the first of a couple of ‘Progress Reports’. Will these lows be THE LOWS? The MACD did cross up on the 10 minute chart…
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Price then chopped sideways, but the MACD & Histogram continued to climb on the 5, 10, and 15 Minute intraday chart. THAT is a good sign.
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50 minutes later ( 5 ten minute candles) and we see that the MACD was rising to positive and price was starting to break out from that sideways chop. I posted this one too.
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And finally, here we see that The GDX followed through higher with that push higher on the above chart, and it closed near the highs of the day. So this is the intraday price action that gives us a new low and a reversal candle.
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FROM THE WEEKEND REPORT:
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GDX – I am actually thinking that this will rally next week, so let’s wait and see how that plays out. This was day 35 and it is late in the daily cycle count and oversold. A move above the 10sma is a shake out recovery and can be viewed as a buy. I might use the 8 ema as a tighter fit and buy a break of that. I do own AG as a Silver Miner currently and EXK and HL look to possibly be bottoming with Silver last week.
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GDX gave us that new low and reversal candle here on Monday, day 36. We had a reversal on day 27, but it was rejected at the 9 sma, so let’s see if this can breakout this week. I have mentioned in many reports that “You can ALWAYS buy a reversal like this with a stop at the lows for a low risk/ high reward entry.”
Now I look at the March ICL and we can view this as a drop into an ICL at almost 6 months. 6 months from ICL to ICL is very normal.
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I wanted to look at The Weekly GDX again, because with Mondays break of last weeks lows by 2 pennies, it is possible to ride up and then put in a weekly swing low next week. That should look like an a-b-c drop on the weekly too.
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Update: This report was written on Monday night, and now this is where Gold is on Tuesday at 6:30 a.m. ET. This is not the 10sma, it is the 7 sma, but at this rate Gold has also just barely moved above the 10sma which is at $1902. We are seeing follow through and a swing low in Gold. A close here or better would be a confirmed swing low.
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We do usually wait for a close above the 10sma, but on the GDX that is possibly higher than many would want to wait, especially with Gold & Silver looking like they have a confirmed swing low in place, so the choice is yours, but buying Miners down here should pay off very well later. Enjoy your Tuesday trading!
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~ALEX
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We have discussed Uranium Stocks a few times, and I have described them as Choppy, yet Bullish. That is still true, but they did put in 2 nice days in a row Friday and Monday…
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URA ETF – You can see that even though it is very choppy, it is also gradually climbing the 50sma higher over time. See also UUUU, URG, UEC, CCJ, NXE, etc. They look like they will just continue to climb over time.
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Ed pointed out the Sprott Junior Uranium ETF under the ticker URNJ – This also has been very choppy and basically traded sideways for months, but it looks to be breaking out and this is a bullish set up too. It ended up having great volume yesterday by the close too.
And finally I’ll show you an example of how many of these Uranium Miners have been trading.
DNN is steadily climbing up the 50sma lately, but again, it has been choppy and hard to buy & hold. If you did just ‘buy and hold’ since it was mentioned in May/June breaking back above that 50sma, the move is about $1.10 to $1.45 (about 35%).
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Eventually we may see this choppiness disappear.
These should continue to push higher, and they could gain traction as more buyers jump in and less sellers unload as the run progresses. At that point they may do more of a vertical move, so I do want to continue to monitor this sector.
