Tuesday October 21st -Time for a Bounce?

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SPX – Well, it looks like we have most likely started the 4th daily cycle. Price is now above the 10 sma, but we won’t have an official swing low in place until price also gets above that large red candle. We were buyers at the recent lows with a stop anyway, so this looks like the markets will move higher heading into the Fed Mtg next Week.

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SPX – So I’ve been wondering if we’ll see something similar to the Magenta box. That was a strong rally out of a deep ICL too, but it only lasted 6 months. If we repeat here, it’ll be 7 months, and we are due for an ICL.  IF WE DO NOT DIP AFTER THE FED? …

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IF WE DO NOT DIP AFTER THE FED, we’d only be on day 12. I’m going to begin to wonder if the General Markets act like the Precious Metals and start to run parabolically. Bitcoin will also be topping, so everything would top at the end of 2025. If so, ride those stocks just like the Miners until it exhausts.   I do think that this is ‘less likely’.

 

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I wanted to mention that I noticed that Uranium Stocks, Rare Earth, Specialty Metals, etc pulled back quite sharply. I’d say that it was sharp enough that it was tough if you are riding them out. However, they also may have become a nice opportunity as they fell to support and held up. I’ll show you below what I mean…

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If AREC dropped from $7 to $3.50 in 3 days, THAT is Big. If it stops and reverses at support, and then runs from $3.50 back to prior highs ($7), that is a double. Well, it reversed and put on 13% when I captured this chart, but if it runs to $8 or $10 from here, it is still a double or more.

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URG – A whole month of gains was lost in 3 days, so that is a bummer, but if it reversed at support and ran back up, now that the dcl is in place, that could be a great trade.

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URG –

1. URG did reverse at support after I grabbed that chart. Its a buy with a stop.

2. I’m not saying that it will run straight up, but it could.

3. If it does bounce around, THAT will also offer you another buying opportunity at the lows.

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IDR has been running strong. It also pulled back sharply, and put in a reversal at the 20ema. You could buy with a stop under Mondays candle.

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REEMF broke out last week and slammed back down too. It is ‘lingering’ at the 20ema and support area. This can be bought with a reasonable stop too.

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USAR reversed right at the 20ema and volume was good.

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WTIC – Oil is at the lows again and it is VERY difficult to see where a dcl was in all of that chop at the August, September, and early Oct lows.  With that, cycle counts may not be visible, but early September does look like one. I would say that Oil can continue to drop down into a new ICL, or it may bounce first to back test the breakdown and then sell off again. Either way, I’m not long or short Oil, due to the lack of clarity.

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The USD was up 2 cents on Monday, and I have explained what I am looking for here. A new higher high—or not.

 

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REMINDER FROM THE WEEKEND REPORT:

GOLD DAILY– Gold was on day 21 Friday and it certainly looks like it is starting a dip into a dcl. It may just be a short drop into the 20 ema, and then rally into the Fed Mtg as a 3rd daily cycle.

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GOLD MONDAY – GOLD REVERSED AND MADE NEW HIGHS. Just when it looked like a day 21 drop starting a dcl dip, surprises to the upside! I assume this is day 22.

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So GOLD is not even dipping below the 8 ema!

We are on day 22 and the Fed Mtg is 7 days away. If it ran straight up & peaked on the fed decision, it would peak on day 29.

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FROM THE WEEKEND REPORT:
GOLD WEEKLY – It is very possible that the LONG consolidation that we saw on the daily charts, that turned into a triangle or pennant was a halfway point or mid-point consolidation of a rally that ends with a blow off top. That is what it is starting to look like now, to be honest. This move is straight up, right?

SILVER slammed down on Friday and it was green on Monday, but it did not POP as much as Gold did. That said, it is closing above that 8 ema, and that is strong.

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The Miners, represented by THE GDX, did not reverse as strongly as Gold. It wasn’t quite as strong as Silver either. It has not held the 8ema, in fact, it closed below the 8ema in September, and then closed below the 13 sma in October, so the Miners are acting slightly differently. The MACD has been weakening, so if Gold runs into the Fed Mtg and Miners do not, they chop, what does that mean to you?

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We had a breakout that failed last week and Now THE GDX has divergence on the MACD and RSI. It means that we may have smart money selling Miners a little at a time to secretly unload to the buyers. If Gold runs to new highs again and again and the Miners do not? large money may be selling to the new buyers. We’ll see how this plays out.

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Things have been getting a bit choppy with the recent dip in the markets weighing on everything, but we’ll see if the general markets can continue to new all-time highs and start to trend a little higher as we start to head into the timing for the Fed Meeting. Have a good day trading on Tuesday!

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~ALEX

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BITCOIN is on day 50 and it dipped overnight, but I still think that we can get a bounce and then a dip around the time of the Fed Mtg. Crypto stocks did reverse higher with the bounce on Sunday & Monday.