Short Term and Long Term
Though the long term views remain the same here at Chartfreak, the short term views do get a bit hazy at times. For Shorter Term Traders, we look for immediate low risk trade set ups, but some shorter term things are a tad unclear. I will show you what I am thinking is likely, but please remember that in times of uncertainty, cash may nor be NOT a bad thing. Patience may even save funds for future trades. 🙂
SPX – As mentioned yesterday, we could be at support but this remains weak looking and even with a bounce we see overhead resistance that should be noted.
Remember that in the NASDAQ I pointed this out…
Basically just a bounce…
NASDAQ CURRENTLY- And this could be a H&S set up. Overhead Gap fill and then a drop? Volume was heavy in the selling.
I mentioned that instead of a market wrap up, today I would try to find some ‘low risk set ups’ after the sell off Monday. I didn’t see a lot of low risk set ups today, so right now let me continue to do a combo of both market observation and a few set ups.
Monday I showed OIL as an acceptable set up, but a possible wedge.
WTIC – So I looked on a weekly and it looks more bearish than bullish so far. OIL needs a break above $38.24 to look more bullish on a weekly chart. The daily is neutral so I have avoided energy stocks for now. I pretty much have only liked the set ups in Miners as mentioned.
The XLE better than Oil, fine with a reversal today, but many OIL/Energy stocks still only look 50/50 to me right now. I looked for great set ups , and I need another day or so to know what they want to do. CJS- EXXI- REXX, SGY – etc not looking ready yet.
Lets go to GOLD…
The COT is BULLISH. This shows that smart money is not short, and they expect higher prices. This is better than at prior ICLs.
With the above COT info in mind, the Gold Weekly chart also appears to be at lows. An area to BUY / not SELL. Look at the B.B. Squeeze. A quick slam would be bullish, a surge higher would be bullish. I do not see the bearish side.
AS GOLD LINGERS AT THE LOWS —- Some JUNIORS are starting to really respond nicely. ( As mentioned…. SA, NG, etc) Lets look at a few other juniors.
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As pointed out here, some Miners look to be Bullishly aligned and also may have lows in place. THAT is when I buy the dips. I mentioned in yesterdays report that IAG ( AUY, EGO, etc ) had a good Monday, IAG even tagging the 50sma. This was coming out of the lows.
This was IAG Tuesday, breaking above the 50sma. In my mind, these moves should helps us to see that Gold could be preparing to burst higher, not lower.
I also mentioned in the comments section that HMY and GFI are African stocks that have done well, likely because of the currency exchange. I mentioned DRD as another African Miner, but also said that I thought that it had light volume. Today it has 1/2 million and burst higher.
MUX is another mentioned here that is taking off. It dropped last week, but you can see that it is acting correctly.
MGH has quadrupled since its December lows.
And BAA is setting up with a base too ( Dec 31 chart).
Breaking out on Dec 29
MGH – Just starting another leg up today ? Low price stocks may not be for everyone, so I am NOT saying to run out and buy this, but look at MGH as GOLD lingers at the lows. We do see a higher low, and it went from under $0.10 to $0.17. Todays volume was good and the MACD is improving as it breaks above the 50sma. (It is a low risk buy if you know when earnings come out and avoid a gap down). Also…
MGH WEEKLY -In 2014 it shot up from $0.15 to $0.62. It quadrupled.
So many juniors are recovering?
So for now I didnt want to present a lot of chart set ups that could fail with current market conditions. Time may be needed to see even what the short term direction will be. I actually thought that I would present OIL stocks yesterday, but they do not look exactly ready to me after today. I have mentioned former tech stock charts that included GPRO, VUZI, GDDY, DANG, ANFI, DGLY etc as remaining rather healthy looking. One can keep an eye on stronger stocks like that and see if they can hold on, or do they give it up eventually.
So yes, we can keep an eye on those tech type stocks mentioned above, but for now I am really only feeling rather bullish on Miners short term. I just feel that with the current set up in Gold being that we have a bullish COT, there are a number of Miners breaking out while Gold lingers at lows, etc. It just seems like a few of many ideas that indicate that this sector wanted to break higher soon. Know your own trading skills. Wait and be patient if you have doubts.
~ALEX
I am watching how certain commodity stocks are acting during the recent market sell off and $USD ‘s move higher. The effect is not bearish so far. These and many others like it are again worth watching moving forward.
If you read the report before 7:10 a.m. Eastern time, please refresh this page and return to the report and see the final 3 charts that I just added. Thx.
GDX has some serious volume today, that mini dip should be bought, I think we are getting our run .
What mini-dip?? One after the first 1h?
The one right after the gap open. We went up 25 points, and then I checked and GDX was only up 15 cents.
And for example, GDX has reman=ined over the 50sma. AUY just passed the 50sma and volume is good for 15 minutes. AUY looks like a buy, similar to what I was looking at with IAG when it passed the 50 sma.
It actually dipped as I wrote, but reversed and took off higher immediately.
You have to see GDX on a 3 or 5 minute chart to see it clearly
I’m showing 2 million volume in the first 1/2 hr on AUY as it crosses the 50sma . That could be well over 10 million end of day, more likely to be 16 million if buying continues at this rate.
On a daily chart, that is bullish.
HMY – Impressive.
RIC – Breaking out LSG – also moving nicely over the 200sma.
PPP- Nice set up
almost 20% in last 6 trading days for RIC got me a bit nervous so I shaved some off the top. Probably will now go higher but there seems to be some major unevenness in the juniors (e.g. NG not even moving today–though had a good run prior). Alex, would you suggest rotating to ‘under performers’ or just hold on tight tot he breakouts?
Where retailers were struggling in the fall, I see
WMT – breaking out higher. TGT unaffected by this sell off, LULU regaining favor , etc
Hi Alex,
Any thoughts on silver’s performance…I’m sure Gold will pull it up.., .but was hoping to see it lead, especially if this was a possible year low. PAAS and SSRI lagging….do you see them playing catch up soon. thx
Hi Curtis,
I’ve been observing Silver and there are a few thoughts in my mind presently .
1 is that it could be a diamond bottom? In the past when silver lagged, it didnt necessarily hinder the silver stocks, but they have been a bit weak or lagging too. PAAS & SSRI seem to be basing, but will they play catch up? I think that they should , but I cant tell.
AG and MVG ( as of today add possibly EXK) are above their 50sma, so Silver lagging hasn’t hindered all silver stocks that much, but we need that explosiveness that silver offers to really get them going.
I am not sure if this is a diamond pattern or not, but this is what I was referring too. It has a positive MACD set up , so I would expect a break higher, and that could get PAAS and SSRI moving.
Curtis , refresh for another example . To me, a diamond bottom reversal is just a tricky bottom base .
They look weak and scare people, but they just build energy for a push higher.
.
thanks Alex…interesting perspective!
Oh, and I hould mention that we should just picture SILVER popping and running to the 200sma for now. I’m not saying we get the kind of reversal and run as we see in the above chart where it just keeps running higher. I’ll take it 1 step at a time . : )
I would take a move to the 200sma. By the way from a cycle perspective what time line are we looking at for this move to last in the pm complex….over the next 3-4 weeks? peak by the end of the month…next FOMC?
Thanks for answering as O had the same question. I have seen fear induced buying in PMs help gold and leave silver, which is what I thought could be part of the lag. That ALWAYS ends badly. So, I like your answer much more, agree gold chart and COT look constructive. Thinking of buying gold here ahead and just waiting for pop.
GDX, there is your buy dip, right there!
LSG today!!
I don’t follow that one but nice pop!
HI guyz
Even if oil is going down, check out REN XCO and WG they holding up pretty good – so buy on the dip : )
Well I may have made a mistake in my big purchase of FCG a couple days ago. Debating whether to hold on a bit longer. Anyone see any hope in the chart? I am waiting to see if recent low holds or not – getting close.
Short term its oversold. If you want out at least wait until it gets up to $4.20 ish. The daily chart could be saved with a double bottom, set your stop just below the previous low. Maybe $4.05 and fingers crossed.
Thanks for the feedback! Should have kept my position size smaller on this one.
Alex, does it bother you that the RSI on GDX daily is over bought already?
Hi Bill,
Sorry, I was away today. I dont see it as overbought on the daily . I see it breaking above 50%
Sorry, I had mine set to RSI=5 for something else.
Oil. Wow. Just when you didn’t think it could get worse. Looking at Alex’s chart above it looks like a DCL came in around 14 Dec with a high on day 8. This could potentially be a last DCL before next tradeable low. If this were to go 50 days as Alex stated they have in the past, that would last until 23 Feb. I would expect a 2nd waterfall which looks like it started this week. Actually, I would be bearish on equity markets as well. Looks like buy the dips is now sell the rips, I’ll be looking to sell equity rallies for the foreseeable future.
Support zones on S&P – 1965 then 1900 then a retest of Aug lows, about 1870 on a closing basis. 2000 will now give it resistance on the way back up. If today was halfway point, that measured move would target 1900 exactly. I’d expect a decent bounce at that point but I’d short. China has once again already dictated tomorrow’s open.
Well, there goes gold, over 1100 (finally), solid breakout, highest since the early November waterfall. I didn’t get to read CF until after market close today and probably would have already. Well, there is always tomorrow.