Thursday October 31st
I feel like I might have some bad news for the General Markets Bulls, but Good News still remains strong for the Precious Metals Bulls and the Crypto Bulls. Let’s take a look at the charts and let me show you what I am seeing.
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Lets just start with SMCI: It dropped 32% yesterday alone, when Ernst & Young resigned as Super Micro’s auditor, citing significant concerns over the company’s internal controls, board independence, and accounting practices. The stock crashed.
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AMD had an earnings report that, after a nice run up & over the 200sma this week, slammed it down below both the 50 & 200sma.
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And then we go to The SOXX: Volume increased with the selling, The RSI & MACD are weakening, and losing the 50sma and a break of the dcl are becoming a threat again. This has been turning bearish as time goes on and that is the bad news. The semiconductors often lead the markets, and the SOXX is struggling to move higher consistently.
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Now we move to The SPX: This is fine as it is, but that MACD cross lower that took place a week ago has not improved. If the SOXX breaks down, that could start the selling elsewhere too (again, the old saying is that Semiconductors lead the markets, and right now they are weak). I’m a bit cautious with the General Markets.
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Along with the weaker looking charts, we also have a good amount of data to be released today, so we’ll just have to wait and see how the futures look at 8:30 am ET.
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WTIC – I expect oil to chop around until it puts in the next dcl.
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THE USD is due for a dcl, so this sideways chop is likely leading to a drop. The MACD is rolling over with the sideways price action. Note: The USD movement hasn’t really affected Gold, so I don’t know if it will help other areas when the USD dips.
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GOLD has made a day 14 high and is really showing its strength. I do NOT want this to just keep running higher into a blow off top at $3000, because it will likely crash after that. Also noteworthy is…
Important Note: As this took place, AU, KGC, HMY, IAG, EGO, etc were all red. They actually sold off as Gold moved higher on Wednesday.
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AU – This is an example of how the Miners reacted to Golds new all-time high at day 14. This is why I have been saying that I think we want Gold to pull back and chop down into a dcl / Icl. If the Miners stop participating, Golds run is less profitable for the majority.
SILVER is on day 16, so it has time to POP, CHOP, or even drop, since the lows have been coming in with SHORT daily cycles. I’d really like to see this as a half cycle low and then we could see a run higher as the USD drops, but we’ll just have to see how this plays out. It IS possible that this runs higher from here, so a stop at the 20ema (& magenta line) is fine.
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GDX may also be putting in a half cycle low, especially if the USD drops from here. It found support at the 20 ema and may bounce to the upper trend line, but I don’t personally really expect more than that. Once the ‘peak’ is in, it bounces, and the MACD and RSI look to have peaked.
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I’m watching that data release after 8:30 a,m, today, to see if it helps or hurts the General Markets (The Soxx does not have a lot of room to drop until it reaches the last dcl level). The Precious Metals sector and Crypto sectors are bullish set ups, and I’ll discuss Bitcoin below. Enjoy your Thursday trading!
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~ALEX
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About a week ago I pointed out that in the past when Bitcoin rallied straight up and pulled away from the 20 ema, so it took time to pull back or chop over to that 20ema again. It actually took 10 long days to chop sideways last February. COULD THAT HAPPEN HERE? It could, since breaking out to new all-time highs can initially take some time (Cup and handles do that for example). So…
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So Bitcoin is quite a bullish set up here at the all-time highs, but when it comes to breaking out, it can Pop, Drop, or Chop sideways from here. When it comes to cycle timing, no matter which low you choose to count from, it will be due for a dip in time, but it does still have time to push higher before that dip comes in.
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Bitcoin #1: If Bitcoin repeats what we saw in February, it could look like this.
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Bitcoin #2: It also could POP (or Drop), so a Pop would be a short term breakout, followed by a dcl back test. Any scenario is bullish long term.
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BTDR had that 24% Pop on Monday, and I wanted to add to my position. This drop to the 8ema (or 10sma) could be all that we get if Bitcoin pushes higher, or it may also fall all the way back to the 50 / 200sma if Bitcoin pulls back into a dcl, but it does offer a buy opportunity anywhere in this area if you can ride the pullback.
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CIFR is dropping, but it could be or become a buying opportunity, even if it drops a bit more.
1. It dropped and reversed today
2. It may be reversing above the 20ema,
3. It is still well above the 50sma and 200sma, and
4. The 50 is looking like it may want to ‘cross’ the 200sma.
Also just did a $3 to $6 run, so a rest here & a dip could be a buy opportunity
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MARA has been ‘crawling’ along the 50sma and usually this leads to a breakout. The only problem is EARNINGS next week on Nov 7. Both Riot and MSTR released earnings Wednesday after the bell and both dropped initially.
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WULF continued higher yesterday after reversing above the 8 ema.
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HUT added another 5.68% to its’ gains, as it chops higher out of the recent base/lows. That ‘Buy’ at the 200sma/50sma was a winner! Hut is up almost 100% from there in 2 weeks.
