Friday October 13th – Just a Speed Bump?
The USD popped yesterday and that caused Gold and Silver to reverse lower. Is it just a temporary speed bump? I would have to think so, because I believe that we have an ICL in place. Time will tell, but let’s take a look at yesterdays markets and a little of this mornings live charts…
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YESTERDAY I SAID…
The USD is due for a dcl. When we see one in place, I think that the USD may just chop a little higher for a few days, but then start to roll over sooner than later. That action MIGHT cause Gold to dip a little and then continue higher.
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THE USD surged yesterday with a strong reversal and this will likely become a dcl. This chart was collected at 6 am today and the USD has a small candle there and it is green, but that is not stopping Gold from pushing higher today…
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This is Gold & Silver at 6:30 am Friday, so that USD reversal is not stopping Gold from pushing higher today. I’ll discuss that a bit more shortly…
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The SPX dropped and started to recover the 20 ema into the close. This should be day 7 of a new daily cycle.
REVIEW FOR OIL: I mentioned in yesterdays report that I felt a day 30 swing low was too early for Oils DCL.
WTIC – Oil sold off yesterday when it was rejected at the 10sma and lost the 50sma. This agrees with my thoughts that the day 30 lows may be ‘roughly’ a 1/2 cycle dip. Oil usually has 45 day daily cycles, plus or minus a few days.
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WTIC – Oil ran up to the 10sma and was rejected again, so I am still thinking that this is day 34 and the real DCL lies ahead. We may just chop sideways above the 200 ema, but a break of that day 30 low should be broken.
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THIS IS GOLD at 6 am Today!
So far we have a day 5 surge of $20. I got called away from the markets yesterday by my wife, and when I got back we had the reversal candle that you see before todays candle. Today looks good and this should be day 5 of an ICL.
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GDX may crawl under the 50sma, since it often acts as resistance, but with Gold up $20 this morning it also may just break through that area today. This was day 6 for the Miners. A good pullback might have given us a buy opportunity in HMY, GFI, AU, etc, but if Gold continues to surge, those gaps still may not fill.
Some miners, especially the Silver Miners, dropped quickly, but a good pullback might have given us a buy opportunity in HMY, GFI, AU, etc,, except that they didn’t drop that much. Now if Gold continues to surge, those gaps still may not fill.
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GFI gapped open and tried to sell off, but it actually still closed green, and…
HMY gapped open, sold down, but didn’t even erase Thursdays day of gains, since that was a large gap open that never closed, so these S.African Miners, which have been my favorite in the last run and this one, remained very strong.
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EGO was down almost 3%, but it remained above the 50sma if you had raised your stop there.
SA was stopped at the 50sma, so we’ll see if it can crawl under it or break out today or next week. Then a stop could be raised there. 
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SILVER STOCKS ARE STILL LAGGING A BIT.
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AG – Silver stocks have not really begun to move higher with zeal, they are chopping along the bottom. That makes them harder to hold with a swing low in the USD, because they could possibly break the lows. Yesterday I wrote about FSM, AG, HL, etc as Silver miners that may be ready to join the run higher, but with the USD putting in a swing low, they are showing signs of bottoming process, rather than rallying. At this point, I would have to say that they may need more time.
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So yesterday was a down day, but with an ICL in place, the surprises should be to the upside. We’ll have to see how Friday closes the week, but so far this morning it looks to be a green day in the precious metals sector. Riding the Bull is never easy, but so far the gains have been good in Gold stocks. Enjoy your Friday trading!
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~ALEX
