Wednesday January 3rd – Patience

The markets are pulling back as expected. We also have the release of the Fed Minutes today. I’m going to just mention that often when the markets are starting to drop down into a dcl, even good looking bullish set ups that look proper can show weakness and fail to find that follow through higher. If you have locked in some gains, holding on to those gains can include a little …patience. As some people say, “Don’t chase the markets, let the markets come to you!’

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The NASDAQ peaked and is ready to drop down into a dcl, as expected. This could take a little time, especially if a dip to the 50sma is what takes place. I have drawn an a-b-c dip as an example, and we should watch the drop, looking for a reversal near a support area. Once a swing low appears, it could be considered a ‘buy’.

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SOXS (& SQQQ, SPXS, etc): I had mentioned on Friday in the comments that I went short with SOXS, because I expected a drop into the new year since we were late in that daily cycle. The problem is that this sell off started late in the daily cycle in the day 40+ area, so it is hard to tell how long the selling will last. It may be a few days with a bounce in between, it could be a few days in a row. So if we get an a-b-c down in the markets, this will drop and do an a-b-c up. If this dips into an a-b-c up, it may become a buy again, or you can start a trade very small, but patience to go long out of a dcl may be the next best trade.

XBI (Or IBB & LABU) – This has been in a steady climb along the 10sma, so if you took that trade (Labu was actually mentioned weeks ago) you can sell to lock in gains or raise stops along the way.

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VIR – Set ups like VIR may work out nicely over the long run too. Some are forming bases. LPTX was an example of a base and…

 

Yesterday in the comments I mentioned LPTX and the progress it has made:

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 I pointed out this Pharma stock under the 200sma over a week ago, but I never bought it because the CryptoStocks were doing so good.

This one was up 17% Monday and has done very well.

OCGN, BNTX, MRNA, NTLA, CRSP, SYRS, VERV, NVAX, OGEN, NUWE, VXRT, INO and more have good %-Gains Monday on a down day for the markets

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WTIC – Oil was up in Pre-market and I was asked if that changed my mind and made me want to buy it. No. I just don’t like the way Oil trades lately, with choppiness and then you see 2 great days and then 2 bad days. Oil then popped open and sold off on Tuesday. It is still fine if you bought the DCL, but I personally am not trading Oil. And…

And some of the Oil stocks that were in the reports like VLO, APA, WTI, ERF, MRO, VET, etc are still fine too. I am just personally not trading this sector.

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USD – The USD is bouncing and its hard to know if it is just a bounce or a dcl, but Gold is NOT dropping in the same manner that the USD is popping.

GOLD is meandering sideways and it does seem to be holding up fairly well with that USD bounce, but I do think that this intermediate cycle has peaked and that the highs are in for now. After the next ICL, a run to break that exhaustion candle is the likely path.

SILVER is weaker than Gold and Silver stocks are probably going to continue to weaken too.

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AG had a decent run, but I would just lock in gains at this point. Why give it back when you can lock it in?

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GDX dropped and when we do drop into an ICL, trend lines are actually broken, so yes, this may bounce and chop around, it may even bounce higher one more time before a dcl comes due, but I think that miners will now remain choppy and frustrating. Some outperform and HMY, EGO, OR, NGD, and a few others may have done well, but I am NOT looking to rebuy my miners until after the next ICL.

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I like to trade and I probably will look for a few small trades here and there, especially if we get a 2 day bounce or so, but Patience can be the real winner. If we just wait for the normal process of cycles to take place, then we know a dip down into a dcl is due and that will make a good “buy the dip’ opportunity when it happens.  Stocks that ran bullishly can ‘re-set’ and offer lower entries too (Think AMD, NVDA, CVNA, AI, TSLA, FUBO, GRPN, and others that moved higher with the markets). Let’s be ready to ‘buy the dip’ after it puts a low in place in various sectors. If you are a day trader like me, remember that any bounces can be much shorter in a sell off and the positions should be much smaller.  I did see BIOTECH/PHARMA bouncing yesterday (CRSP, NTLA, and others mentioned above), but many did not close near their highs and that is what happens when markets have sellers in them. Follow through is not as bullish daily. Enjoy your Tuesday trading!

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~ALEX

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BITCOIN broke out yesterday, but Crypto Stocks ‘Popped and Dropped’ in a big way! Some of them opened up 20% and then closed down. Today is day 50.

 

WULF, BTBT, MARA, IREN, BKKT, etc etc all gapped open in a big way, but they sold off to red. WULF was up 20% in pre-market and also when the markets opened, but it sold off and closed down 4%!  PATIENCE is needed.