February 8th Weekend Report – Look at the Big Picture
I want to release this report tonight, because we are getting a snowstorm overnight and I need to do a lot of clean up in my area in the morning. That means I tried to do my best to avoid typos, but I don’t have time to proofread for mistakes. If you find something that you don’t understand, feel free to point it out in the comments and I’ll fix it when I come back. Thanks!
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SPX DAILY – The markets do not like uncertainty, and we have had some ‘news events’ that have caused a degree of uncertainty. As we rallied out of the ICL, we have had concerns about what tariffs might really do with the economy, and how will the current leadership affect international relationships? you may recall the ‘AI’ news that caused a 1-2 day crash in tech. So when we look at the chart we see that we are only halfway through the first daily cycle, but we keep reversing and dropping. This chart shows the drop into a reversal candle as a green candle for some reason, but it should be a red down day, so I want to redraw that…
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NOW LET ME POINT OUT A TRADE POSSIBILITY…
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SPX DAILY – So we see 3 reversal candles at the top and a gap down reversal that followed 2 of them, which would be a very red day. That was the buy though, because we then had a move higher from there. My Point? We had a reversal lower Friday at the top, so if we gap down Monday and start to reverse, that may be the buy at the half cycle low. MAYBE we can finally rally out of these lows as things stabilize.
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SPX DAILY – THAT final dip on Monday would look like this as a possible half cycle low, and then hopefully the ‘uncertainty’ dies down and the buyers re-enter.
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NOTE: So you could go long SPXL, SOXL, TQQQ, QQQ, SPY, etc, but also SOME stocks have not been selling off with the markets and those are the ones that may be best to hold. PLTR released earnings and gapped up and is overextended, AAOI sold off but looks to be ready to recover. AMZN & GOOG Both look bad and are selling off post earnings. NVDA slammed down but has been recovering for days. GRPN looks good. OKLO, SMR, LTBR have rallied despite the selling, etc etc , so run through any watch lists that you have and see if certain stocks are following the markets drops ..or not.
Did you see BBAI? It has had a Huge Rally, despite the markets sell offs. That is an ‘AI’ stock Rally, so ‘SOUN’ and ‘AI’ (same sector) are resting on support areas and might be next.
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‘SOUN’ is resting on the 50 sma and the 20 ema. It had a very strong rally from $4 to $24, so it needed this rest, but keep an eye on it, since it is hardly selling off when the markets chopped. AI is a similar set up (BFRG & GFAI, same sector).
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SPX WEEKLY – I hate to point out a topping Intermediate Cycle vs where we are now, but there are similarities to late 2021 (weakening MACD for example).
The weekly shows ICLs at the 30 week ma. We should rally higher out of this ICL and even the one that ‘peaked’ in 2021 into a much larger correction lasted 3 months to the ‘peak’, allowing us 3 daily cycles higher.
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WTIC WEEKLY – Oil dropped this week and is seeking out a dcl. If it forms as an ICL, it may then bottom & run up and breakout from this long downtrend. If, however, it is just a 3rd daily cycle and then a 4th one is needed to get to the ICL? That could lead to a breakdown, because we are now deep enough into that Apex that an ICL could become a loss of support. The next daily cycle will show us Oils set up as Bullish or Bearish longer term.
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USD WEEKLY – I’ve been showing on the daily charts that we had 2-3 strong daily cycles higher, but this 4th one is starting off as a weakening daily cycle. I have expected the USD to roll over into an ICL sooner than later.
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GOLD WEEKLY – Looking at the prior runs out of an ICL, we see dips & sideways moves along the way, because dcls come due. We are due for a dcl, and I don’t see one on this run of 6 green candles, so we have to expect a dip or a ‘stall’ soon.
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SILVER WEEKLY – Silver gave us a doji candle for the week, and may dip into a dcl early next week. This really is a nice bullish set up because we are early in the Intermediate cycle out of the ICL. Silver has some nice upside potential here, especially if it targets that upper trend line again.
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I will do 3 different views of THE GDX WEEKLY CHARTS.
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GDX #1: GDX was very choppy in 2024 and continued to bounce and then drop all the way down to support. I don’t think that we will see that repeat this year for several reasons, and one is that we already have 6 straight weeks of Green. GDX is strong out of the ICL.
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GDX #2 – In this view I am showing the prior rising channel and the recent breakdown, back-test, and ICL. GDX has now rallied back to the channel and then sold off a little last week. So we may see a small dip here as a dcl, and then more buying would push it back into the channel for the 2nd daily cycles run.
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GDX#3 – This is another Bullish view that I showed in past reports. This has been a very strong first daily cycle and The GDX ETF should have much higher to go over time.
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So we have had some choppiness in the General Markets, but this early in the Intermediate cycle (Day 18 out of the ICL), we still should be looking at a Bull Market. Oil is right at the Apex of a trending move, but breaking up or down is yet to e seen. The USD should roll over and drop into its own ICL soon, and The Precious Metals sector is really in a Bull Market, also just starting a multi-month move up and out of an ICL. With Miners we have laggers and Leaders and some of the ‘laggers’ have started to try to play catch up as the leaders break to new highs. That has been a buy a basket and hold it set up, followed by a ‘buy the dips’ at the dcls. We are due for a dcl in that sector soon. Enjoy your weekend and thanks for being a Chartfreak with me! 🙂
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~ALEX
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BITCOIN often finds a half cycle low around day 30 and we had one at day 21, but now we are still at the lows and we are on day 26. I do not think that this has to drop down and break that day 21 low, but it could.
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For starters, I think that I’ll be looking for a move higher above the pink downtrend line and then check and see what the Crypto Stocks are doing. This may indicate that a low is in place. So this may drop first or it may just break higher at any time, and then it could make the run higher in the 2nd half of this daily cycle. So far. the volume on the Pops has been higher than the selling on the dips.
And this was my Weekly chart from Fridays report: If the price drops to the lows, the cup & handle is pretty much invalid, but it’ll still be bullish if it breaks upside.
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BITCOIN : O.K., I guess I’d still call this a cup formation with a handle, but that sharp drop on day 20 somewhat ruined it, because the handle should not drop back as deep as the lows. A rally next week would be good timing since this is day 24.
