Wednesday March 30 report

/53 Comments/in /by

The various sectors of the markets have been a bit tricky to identify strength-wise in the short term. I’ll show you what I mean…

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SPX – With this set up,  I wondered if we saw an   Early dcl.  We had the trend line break and a move below the 10sma. If THAT shallow pull back is all we got, this little rally could become quite the threat moving higher.

SPX 3-29

But…

SPX – One day later we break out and put in what I see as a reversal candle. Now if this breaks back below that trendline,  I would have to say that we are dropping down to find the DCL now.  There are several reasons for this. This could be a false break out. If we just test the trend line, we could continue higher for a while.

SPX 3-30

 

SO lets recap here –

1.  We were looking for a DCL with that rising wedge, and we started to dip. 

2. The Fed speaks Tuesday and we get a reversal / and a push higher,  possible early DCL.

3. Wednesday, we rush higher and sell off , and that looks like a reversal candle.  Dcl still ahead?

4.  We need a bit more time to see if we get follow through higher or lower now.

 

IBB –  It has been basing at the lows. It is still being rejected at the 50sma.  If the markets still need to find their DCL,  will IBB just keep going sideways?  Quite possible.

IBB 3-30

USD  –  The dollar dropped as expected , but reversed a bit as seen by that candle.  I think that it could still drop to the trend line,  and thus Gold could linger or pop a bit where it is. 

USD 3-30

WTIC–  What can I say about OIl.  It is doing exactly what I thought it would – drive everyone crazy! Why?  Because those OIL cycles can last 30days, 38 days, 45 days .  Watch the following series of charts…Are you sick of it yet?

Day 30  –  $39

WTIC 3-28

Day 31 – $38.49

WTIC 3-29

Day 32-  $38.32

WTIC 3-30

And OIL could bottom tomorrow or it may not be done for 5 more days?  8?  10?  

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XLE – I actually would like to see OIL drop and take this with it.   XLE at $58 looks perfect.

XLE 3-30

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NATGAS-  So far it continues higher,  I’d like to see a new high above $2.03.  Good to see it close above the 50sma 2 days in a row.  😉

NATGAS 3-30

THE CRB –  I like commodity stocks set ups, but they are consolidating the last run ups gains.  They  just dont seem QUITE ready to go yet.  I thought we had it in VALE today,  but the follow through buying wasn’t there .  I still like the set up,  here is VALE  for example.

VALE  March 28 –  looking for  a break out or dip to that support in the aqua/ trend line area

VALE 3-28

VALE – We got the break out this morning,  so I thought we had our next run coming along.  It then sold off into the close and ended above the 200sma and trend line, but at the days lows.  I STILL LIKE THE SET UP AND WOULD LIKE TO SEE IT HOLD ABOVE THE 200SMA.  CLF looked similar.

VALE 3-30

CRB –  Will this drop to the 50sma or just break out?  Thats what I have been watching  for  

Either way,  I still view this as a bullish set up for commodities, but the answer may take a little more  ‘time’.

CRB 3-30

 

GOLD –  Let me just draw it like this and see what happens. $1240 is a trend line overhead.

GOLD 3-30

GDX –  Many individual Miners are doing their own thing  (Some near highs),  but I have to expect a pull back. We got our gap fill,  if this rolls over, we have a mini H&S. 

GDX 3-30

 

So that is how I see things here.  It may take days to play out.  A pull back in the SPX to a DCL could take days.  Oil has been dragging along. The CRB might be close to an updside pop, and charts of X, CLF, AKS, VALE, FCX, etc seem to be bullish,  though they could pull back before moving higher too.   Gold & Miners could take days / weeks to finish correcting and finding the next DCL. It may be an ICL. 

That said,  we may not have a Friday report.  If what is stated above in this report doesn’t change much after Thursdays trading,  it will still apply to Friday too.  And since there will only be 1 trading day left in the week,  I will just cover any changes or new developments  in the weekend report.  The only positions that I personally have on now are Commodity.  I sold all energy and RPTP /  CGIX as a trade.  I own VALE, CLF, and AKS.  Have agreat day and thanks fro being here!

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~ALEX

 

53 replies
      • Al G.
        Al G. says:

        No it’s too Damn volatile like gold. No direction. Oil seems to have stalled but next thing I know it could pop.

        • Mscrystal
          Mscrystal says:

          I love Alex’s charts and am just starting out…but I also believe there is often a “story” or macro event behind major changes and you have to sniff it out (former investigative journalist) anyway, I would be patient for the next two weeks (unless Alex’s charts become decisive in oil) April 17 is going to be huge – and I would stay away from oil in the days leading up. If the news from Doha comes out positive for a freeze, then have your picks lined up and be ready to buy. Just a thought..,, open for discussion 🙂

          • chartfreak1
            chartfreak1 says:

            I tend to agree. I dont know what the catalyst will be, but the charts do allow for a drop ( you almost want to see that drop like my XLE chart). THEN we will be at the DCL (Daily Cycle low) and the next leg up could be big again.

            I know many didnt follow me on the first leg higher in some of these, but they were HUGE moves coming out of those bases. LGCY, WTI, REXX, etc . Big gains, but no follow through on the second leg higher. I think that next move up could be very good too, for companies that have a plan / low debt.

          • Ken
            Ken says:

            Indeed !!!
            Although my smile was in reference to the “low debt” recomendation on the oil jr’s.
            Sound advice. 🙂

          • chartfreak1
            chartfreak1 says:

            LOL- for longer term investments, it is the safer route. Especially if some junior Oil companies go BKRPT. When I trade shoter term? … I dont follow that advice all the time.

            The initial POP out of the bases is short cover and emotions. Look at the POP IN ARP, REXX, etc 🙂

            And as for Gold/Silver MINERS? The best performers %-Wise seem at times to be the least fundamentally sound and more speculative.

            I’m amazed at AUMN and AXU in the past %- Gain wise, VS RGLD or AEM. I just go by the technical analysis and charts at that point ( And a BASKET to avoid individual risk).

            Crazy stuff

          • Cason
            Cason says:

            Remember the Stone Energy SGY pop above 8 in October, looked like it could scream back to highs? Closed a bit under 80 cents today. Ouch!!! That’s what high debt can do…!

          • Mscrystal
            Mscrystal says:

            I think Saudi Arabia holds all the cards right now, I am fairly sure that oil took a nose dive after the OPEC meetings when they basically said screw US shale, in nice diplomatic talk.

            I also have two price WTI price points in mind below 33 is fire in the hole, and a strong move above 40 is all hands on deck. So it’s patience, prudence – (but maybe not the other thing) for the next two weeks 🙂

          • Mscrystal
            Mscrystal says:

            One more thought….., I would not be surprised to see oil drop to $33 or below right before Doha to cause maximum pain for Iran – who has agreed to go but isn’t going to talk (grow up Iran),

          • Maria
            Maria says:

            …. wellll said! …go figure… i did the same with a couple .. what a snoooozeFest “4s” are …
            im watchn that clne too… thinkn it will give a nice pop..?

    • chartfreak1
      chartfreak1 says:

      Hi Al,

      I’ve kind of been trying to let people see that Time wise, it could keep dropping to find a low ( It also could just go sideways).

      Scroll up & look at my 3 oil charts in this report. On all of my recent charts I try to point out that the 50sma is only at $34. The 50% retrace is at $34. a 38 %retrace is $36. So I do get emails from time to time saying ” I want to buy energy stocks, what looks good?”

      A pull back to $36 or $34 looks good to me 🙂 and thats also why I put the XLE in the report. A pull back on that also looks good. I do not own any energy at this point.

      Finally : I made some great trades out of the low on many oversold Energy stocks that bottomed and based. Then I bought the pull back and some of my gains were given back when we didnt really get a 2nd leg higher in those stocks. ( SEE WTI as an example. $1.50 to $3.50 = GREAT. Then $2.25 to $3 and dropped quickly again. No new highs) .
      Some bounced a bit , but not to new highs and returned to my buy point- so I sold them off and will wait for OIL to look right. It then became time for OIL to find a dcl. OIL stocks may bottom first , like Miners before Gold, but I haven’t loved the set ups a lot yet. We may be getting close now though.

  2. Shermo
    Shermo says:

    Hey no problem here waiting days, weeks for the next run to start in both energy, miners and especially miners/gold. That last run was incredible and you called it when everyone else was yelling sub 1,000. I would expect the next run to do just as good since it could be considered wave 3 in EW. Question? Would the next DCl qualify gold to be a possible ICL?…if it came in mid to late April does that give it enough time to qualify as a normal ICL?….thanks for you guidance….Shermo

    • chartfreak1
      chartfreak1 says:

      I agree Shermo. I will also admit that it’s easier to say that I’ll wait , but it is the best plan. It pays off to catch the lows and ride that wave higher. One thing that makes it easier to wait, is when you see all these false starts / pops and you want to jump in….then you see them sell right back down. THEN you say , “I’m glad I didnt jump back in”.

      And I am thinking that the next dcl could very well be an ICL. Some would say no, it is too early, but I will explain ( probably in the weekend report) why we could see an ICL in April.

  3. chartfreak1
    chartfreak1 says:

    So right now – I see GOLD popping up $14 to $1238. Looks huge, and the dollar dropped to 94.65 , and that looks huge. To many it feels like we are going to miss a move here.

    For perspective :

    NOW go back into todays report and look for $1238 on my gold chart and 94.65 on my dollar chart. It gives us a different view of what we see, and it also shows us what could just be wiggles that can keep people jumping in & out of the markets day after day , unsure of what is happening.

    • Cason
      Cason says:

      Great perspective, man. I used to try to trade these wiggles. Emotionally. Disasterious. But now I don’t. Awesomeness!

  5. Mscrystal
    Mscrystal says:

    It’s a daily play…. Bios are hitting resistance…I like the way it’s acting at 54… You need a stop and must be I front of your screen and know your tolerance for risk

  8. Mscrystal
    Mscrystal says:

    Lol…,lol …, lol “not guilty” phhhhht!:)http://www.cbsnews.com/news/adalberto-perez-florida-man-pleads-not-guilty-in-4-8m-gold-truck-heist/

  9. Peter Castillo
    Peter Castillo says:

    Bill and Cason! Biting here on LABU, hopefully we nail the landing and get a close above the 50 sma finally. Normally I would wait for the close of day, BUT, something interesting happening, so I’m in. Large buyer showed up in XBI options: 10,000 $52.50 calls. Thats a pretty large bet that it trades higher, so I’m in. We are *apparently* not going to retest lows, much less have a false breakdown that I SOOO wanted!

    • Cason
      Cason says:

      Peter, where did you get/see call buyer info? I trade and understand options but don’t follow ones that I am not trading or planning to trade so I don’t usually see this (unless highlighted by media or Stocktwitsn etc.).

      • Peter Castillo
        Peter Castillo says:

        I follow OptionsHawk on twitter. Granted, doesn’t mean the buyer will be right, of course, but when that amount of money is thrown into an option trade, it’s pretty high odds it’s institutional money, not a retail trader. *Usually*, they get their $$$. So when something like that happens, it’s got pretty good odds of going in the direction of the trade. This case, higher. I did not go in big, waiting for some follow thru and looking to see how the week closes. April Fools tomorrow!! You never know what they might have in store for us little retail peeps.

    • Cason
      Cason says:

      So…crazy story here. So I wrote yesterday how I got stopped out of LABU. So turns out with the reverse split my broker dorked up my stop and only 1/2 of my shares were sold. So, I still have 1/2 by accident and now I’m up 9% from today. 🙂 Might add back more if we see the opportunity but didn’t chase today with Jobs Friday.

  10. chartfreak1
    chartfreak1 says:

    XBI – strong volume today – almost the average daily volume only 1/2 way through the day.

    PETX, MDVN, SCLN, LJPC, RPTP, MACK , etc on my list all look pretty good.

    ( WHAT IS GOING ON WITH PRQR? HUGE volume, no news? )

    LABU has had huge volume the last few days – todays will beat yesterdays

    • Curtis
      Curtis says:

      Hi Alex,
      If you were holding LABU right now…would you look to take profits by days end, before JOBS tomorrow…. which could take the market down or is todays strength pretty convincing

      • Cason
        Cason says:

        Curt, I know it’s after hours at this point – I’m holding mine BUT I only have a 1/2 position now with some cushion so even with a solid beat down tomorrow I could get out at breakeven pretty easily.

  13. Peter Castillo
    Peter Castillo says:

    Bill! I would really have liked a stronger close in LABU, but it is what it is. Let’s see if it can follow through tomorrow. First qtr is behind, and left an amazing looking candle for spx. But let’s see if the 2nd qtr can get off on a positive note. If they manage to send spx back to 2033 or so, the weekly candle wont look good at all. If anyone looks at gold in monthly chart, today was a VERY big day. Had gold not rallied, and instead just fallen by $10, it would’ve left a shooting star monthly candle on MASSIVE down volume. Not too inspiring that miners underperformed like they did today. Sold the rest of KGC on todays reversal and continued divergence. Will hold AUY, EXK, and TAHO, with hedge. Maybe we finally get a friggin’ pullback! Holding CENX,VALE, and CLF, but to me they look like they want to come down some. SSYS I bought today. Think it will outperform DDD. Energy is just meandering without direction. I think we could get a pop to create a negative divergence, and finally have some clarity as to future direction.

  14. Peter Castillo
    Peter Castillo says:

    One thing about gold stocks: seems like *everybody* is seeing the same H&S pattern in GDX and expecting a break lower. That may actually be bullish.

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