Friday March 13th
We have a lot of DATA being released at 8:30. We will have consumer spending, but then we get the PCE numbers, CORE PCE, and the delayed numbers too. This should affect and move the futures markets one way or the other.
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On Thursday The SPX gapped down after the jobless claims report and then it continued to sell down. We are again threatening the recent lows, so these markets remain ‘chop and drop‘. Take a look at the 20 ema.
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THE NASDAQ futures also sold off after the jobless claims report, so the NASADQ gapped down lower and continued to sell off. I have recently started to mark the day 38 low out of the ICL as a likely dcl, and now we appear to be on day 36 of a 2nd daily cycle?
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THE IWM came out of that Nov ICL strong, and I originally marked day 27 as a half cycle low and day 24 as a ‘day 51 dcl’, but now I wonder if we had 2 daily cycles here too? That 2nd one would be short at day 24, so it seems unlikely, but it doesn’t matter at this point. we already discussed that when the IWM sold off sharply in March, it broke the day 27 low, so we have a failed intermediate cycle and that calls for a continuation drop (with bounces) down into an ICL over time.
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As a reminder, we have seen choppy markets before. Does anyone remember last year at this time when the ‘Tariff talk’ choppiness caused a sudden drop into an ICL in April. Buying that ICL lead to some stocks running up 100-5–% or more. This choppiness will eventually find an end too. I can discuss this in the weekend report.
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WTIC surged again and it shows us a moonshot on Monday, a drop to the 20ema area, and a continuation higher. That ‘moonshot’ surge is usually a short term blow off top, and if it is, it shouldn’t be broken to the upside, so I’ll draw what we could get with Oil.
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I just want to mention that a moonshot like the one with Oil is often a blow off top and becomes at least a temporary top, but with the War in the middle east and the circumstances that come with it, it is possible that Oil could continue higher. Below is what I think is more likely though…
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WTIC – Oil could flag or form a pennant, chopping sideways and higher to give us a larger consolidation. This is just a guess, based on past experiences with blow off tops, but we’ll have to wait and see how this plays out with the war and other circumstances that are bullish for Oil. Some Oil stocks were actually red again on Thursday, others were green.
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I had been waiting for this long consolidation to break out with PUMP, and it broke out Wednesday and Thursday.
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YOU CAN SEE THAT OTHER OIL STOCKS DROPPED DESPITE THE BULLISH SURGE IN OIL.
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AND SOME OIL COMPANIES MAY ACTUALLY BE ADVERSELY AFFECTED BY THE SITUATION:
This update by BORR was released on the 9th and it didn’t really seem to affect Borr then, but it certainly didn’t surge with Oil over the last 2 days and I didn’t see any new news for Borr to cause that 9% drop yesterday.
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YESTERDAYS REMINDER ABOUT OVERHEAD RESISTANCE:
THE USD is churning sideways is at a resistance area around $99-$100. We’ll see if it can overcome resistance over time.
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THE USD continued to surge higher and is near $100
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GOLD dropped with the inflation report and this was day 28 on Thursday with Spot Gold. The lows of $4995 were not broken and I would expect Gold to get down near that area as a dcl.
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Just a sidenote: Gold is only on day 28 today using stockcharts. I have to expect a bit more of a drop with a dcl coming due.
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SILVER live 6 a.m. ET: Silver dipped lower and is only on day 25. he day 17 low is at $77.93 and I would expect this low to be taken out with a dcl dip.
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GDX lost the 50sma and closed below it on Thursday and the GDX has followed a path similar to Gold.
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We have seen choppy markets in the past and eventually, after a sell off into an ICL, you can get a very strong buying opportunity that leads to a nice rally higher and good gains out of those lows. That is the good news, but for now? The chop continues.
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The choppiness has continued with the uncertainty in the world around us. The set up indicates that the general markets are affected by this uncertainty, bad news, war, inflation, the idea that the fed may not cut rates soon, etc etc, and so it is too weak to rally. When this happens, we often get small bounces lower over time and then an ICL forms. That ICL may not come until April or May, and I will discuss that with charts in the weekend report. As for Oil, it is bullish in the news of Oil shortages and Oil tankers not being able to deliver more Oil. This can be a temporary situation, and Oil Reserves are being released to add to Oil supplies, but right now the situation is bullish for Oil as it takes place. Gold and Silver are weaker as they came due for a dcl. Those often come around day 32ish, but it does vary lately, so it could come at any time. Please remember that in these conditions it is wise to keep positions very small or sit on the sidelines with Cash and watch to see which stock remain strong during this chop. I see Rare Earth, some Aviation / Aerospace stocks holding up, and Drones, Aluminum stocks and Uranium have held up too, so there are areas that may show relative strength and may do well when the markets bottom. I will continue to discuss this as time goes on. UMAC made new highs, RCAT, ONDS, DPRO, KTOS, etc are holding up too (earnings for RCAT & ONDS is next week). So, some areas are showing strength despite market chop.
NOTE: Support is working on the website over the next couple of days, doing some major updates. I may not be able to post the weekend report until late Sunday due to it being worked on and taken offline.
Thanks for understanding! Enjoy your Friday trading.
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~ALEX
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YESTERDAY I WROTE THIS IN PART:
BITCOIN has not changed much, but volume did seem to increase a little, so I drew an ambitious run higher. It has been extremely choppy and may not be able to get as high as I have drawn it, but it was able to get above the 50sma on the last choppy run in January, so I drew it that way. I think that an excellent buy will come in 2026 after another sell off or 2. I am seeing that some Crypto stocks are holding up well despite Bitcoins drop and they may be sell down a little more later, but they seem to be resisting the selling to a degree and could become very strong on that next run. We’ll be looking at that when the time comes.
BITCOIN – As mentioned, during the Nov – January sideways chop, Bitcoin was able to briefly get above the 50sma. It is now trying to get above that 50sma again.
