Wednesday May 8th

DATA – Gold has been slowly chopping around and I feel like the selling is pretty much done, it may just need a catalyst to push it higher. I’m not sure if I see one here, but MAYBE Gold will start moving higher after one of these events.

 

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The SPX made a new high on day 12. We are now in a ‘buy the dips’ if we get them mode. If this falls back and tests the 50sma, it would be a buy as it reverses there. This should be a first daily cycle out of an ICL.

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WTIC – Oil made a new low and it is hard to know whether we had a dcl on April 22 (right on time) or is this an extended daily cycle. I was thinking that this may be a 3rd daily cycle selling off early, but what makes that questionable is…

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THE XOP (& Oil stocks) have been rising now as Oil sells off. Is THIS telling me that Oil is going to dcl now and Oil stocks just bottomed first? That is possible, so I need to consider that possibility with this new development. I’ll show you something else next, another tricky set up…

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NOG & a few Oil stocks have bounced with The XOP as Oil dropped too, but this looks like a possible bear flag under the 34 sma. A break above the 34 sma is Bullish, a tag and rejection is not good. MRO and ERF is doing this too, but others like VLO , VET, and a few others are just going sideways. Time will tell.

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THE USD dropped last week after the Fed Mtg and has now bounced back after reversing at the 50sma.

 

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Yesterday I used this chart to show the Daily Cycle count for GOLD. It used to put in a dcl at roughly day 32 and here we see a day 33 low on Spot Gold. Price then moved up on Sunday and tried to close above that 10sma to give us a confirmed dcl. There is a strong possibility that this is the swing low and dcl at day 33.

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So here we see GOLD crawling along the 34 sma and this would be day 2 of a 3rd daily cycle. A 3rd daily cycle MIGHT BE weaker than the first 2, so…

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GOLD – We need to keep in mind that Gold could top out as left translated in a 3rd daily cycle and become choppy.  It doesn’t have to be L.T., but it seems to be a longer daily cycle and so it may be weakening. So what if it tops out, let’s say around day 11 or so. It might just chop higher and put in a double top, something like I’ve drawn here. This is not a ‘prediction’, but it is a possibility.

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Do you remember the first daily cycle? GOLD went sideways at the 34 sma for 10 days before it ramped up.

 I draw this reminder, because I know that some feel that Gold is lame in the 3rd daily cycle, and that there is something really wrong here, but this would be day 2, and it was choppy and sideways in the first daily cycle too. I just think it needs a catalyst to start a run higher and get buyers to buy back into Miners.

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SILVER had a burst of energy on Monday, but it has stalled. This looks like a dcl at the 34 sma too.

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The Miners, as seen with The GDX ETF, bottomed early and are choppy. I would think that we should get another run higher after this consolidation too.

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As a sidenote: KGC released earnings and was up slightly (1%) in after hrs last night.  It has already been strong and is hanging at the highs, so maybe this will cause it to start to run to new highs

At 7 a.m. Gold is up $1 after dropping into the red. It still looks like Golds bottoming process is slowly curling upward. This would be day 3, so take a look at day 3 of the first daily cycle. We had several small candles slowly bottoming.  Take a look at the day 3 of the second daily cycle. After a day 2 surge, day 3 and 4 dropped back down, so at this point Gold is acting normal.

So we’ll see if Gold & Silver can find a reason to continue to move higher today, and maybe even pick up some speed. We should see higher price over time, so hopefully it picks up the pace one of these days this week. Enjoy your Wednesday trading.

 

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~ALEX

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BITCOIN is on day 49 and was rejected at the 50sma again. I am expecting a final drop and that low should become a nice buying opportunity.