July 31 Fed Wednesday – Are We There Yet?
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Yesterday I pointed out that the General Markets still look weak to me. This is a second daily cycle and they should be showing strength, but I have pointed out why I see these as weaker markets now.
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NASDAQ saw the follow through lower after I posted that QQQ chart.
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THE SOXX is what concerned me and alerted me to failure and weakness in the semiconductor sector. This is real volume so what happens from here with the Fed Mtg and what should be a rather bullish discussion of a rate cut in the future? Well…
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THE SOXX could just drop to the 200sma and then bounce or maybe it bounces with the Fed Hope—but that bounce may be short lived and simply relieve oversold levels as shown. I shorted this 3 times with SOXS as just a day trade and made 10 – 11% each time ( 11% yesterday alone), so if this bounces and remains weak, I will definitely short this.
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SOXS: I wish I bought and held this when I saw the SOXX fail, but I have taken the day trade & I shorted this 3 times and made 10 – 11% each time ( 11% yesterday alone). I took somewhat smaller positions, not trusting it 100%, but if this bounces and remains weak, I will definitely short this again. The SOXX could just sell off and this could just run higher, but I’m hoping for a market bounce and a dip of the SOXX to the 10sma.
WTIC – Oil is still dropping and I have mentioned that this is an ICL and it might just do a ’round trip’ with a higher low to come. GUESS WHAT THOUGH?…
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GUESS WHAT THOUGH?
1. The General Markets SOLD OFF,
2. Oil SOLD OFF,
3. The Oil stocks moved higher? Very Nice.
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XLE – So the Oil sector (stocks) remain bullish, even with Oil and The General Markets selling down yesterday.
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IN YESTERDAYS REPORT I MENTIONED THAT:
GOLD is within the timing for a dcl at day 33, and this very well could be a dcl in place at the 50sma right before the Fed mtg.
GOLD then started to break out from a downtrend and above the 10sma yesterday during market hours, so I posted this. We now have a swing low in place and this should be the dcl.
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As the day continued, that GOLD break increased, so again, we do have a swing low in place and this is the day before the FOMC Meeting, but it can and usually is still quite volatile when the Fed Speech is given today.
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SILVER has a swing low with a day 30 low, but it is NOT above the 10sma yet, so it is ‘unconfirmed’, but it might be the Silver dcl, possible ICL. That said, with the cycle timing and current set up, we should see higher prices even if we get an initial sell down after the Fed. Notice how Silver can be choppy at prior lows.
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GDX would have an early dcl if it doesn’t drop to new lows, since the lowest point here is actually day 26. To be honest, I expected a tag of the 50sma or even a shakeout around fed Wednesday, but Gold has a dcl so that may not happen.
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It’s time to run through your list of Miners and start looking for some bullish signs. I want to mention that Silvers chart sold of sharply from day 18 onward (See Silver above) and yet several Silver Miners look great by comparison.
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CDE looks great and hasn’t even been able to tag the 50sma, despite the Silver sell down. It may or may not dip down again, but so far it did not follow Silver lower.
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Again, look at Silvers sell off from day 18 to 28. Steep and deep. CDE above did not and EXK below did not.
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Here I just want to show you what I noticed about Past EXK Earnings. Each time EXK had pre-market earnings release, it rallied 15-21% that day. EXK has earnings due out on Thursday. Could it be different this time & sell off? Of course, but from what I see here, this might be a good time to buy some EXK if you don’t already own some. I expected a tag of the 50sma on Fed Wednesday, but again, EXK did not sell off like Silver did either.
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IAG is interesting as it regained the 50sma when Gold regained the 10sma yesterday.
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Near the end of yesterdays trading I suddenly saw AUMN take off higher by 16%, so I grabbed this chart and posted what I saw. AUMN didn’t seem to have any news at the time.
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At the close AUMN held 15% of the gains and I actually like this set up, since it did rally swiftly in April too. It tripled then.
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Today is the F.O.M.C Interest Rate decision day, followed by a speech by Fed Chairman Powell. It is pretty much always volatile and filled with knee jerk reactions and false moves from 2 p.m. to the close, but to be honest, the set ups in the Precious Metals sector do look nice and the timing aligns with them being ready to make another move higher. Take a look at some 1 year charts and you’ll see that this has been a 2024 Bull market and ‘buy the dips’ has paid off nicely every time. I sold my miners a while back and now is the time to have a basket and add to it too. Enjoy your Fed Wednesday!
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~ALEX
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BITCOIN YESTERDAY:
This is Bitcoin on Tuesday morning and I see a tiny reversal trying to form after dipping to the $65,000 area overnight. Is that it for the dip around the day 30 area? Maybe or maybe not. I would have expected a dip down to that day 20 area, but this may just chop around until after the fed mtg too. For now, it has become choppy up near the upper down trend line, and that was to be expected as the day 30 time period approached. Crypto Stocks remain lack luster (for now). Maybe they’ll run after a breakout to new highs.
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I SAID THAT I CANNOT RULE THIS OUT: This may be why the crypto stocks are not rallying yet.
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BITCOIN: Are the Crypto Stocks just choppy and lack-luster because they know that this consolidation is not ready to breakout yet? I cannot rule this out, and we have seen this happen with Gold & Silver Miners when Gold wasn’t quite ready to breakout yet. If this longer consolidation is what we are going to see, I still think that this will break out and run into the end of 2024, possibly after the September Rate Cut.
BITCOIN: This is what we got on Tuesday…no change really. I have drawn a possible dip into day 30ish and then another move higher, but so far Bitcoin has become choppy at the resistance of prior highs. I watch this and the stocks every day and will report anything interesting that I find, but yesterday was a nothing day heading into the fed.
