Here It Comes!

We are THAT much closer to the Brexit vote and it is being discussed on any and every financial media outlet available. Here is the ‘kicker’, did you know that it is forbidden that the vote be reported by the British media after the voting begins?  Yes, that’s right, they can report on it right up until the voting begins, and then there will be NO UPDATES all Thursday, no exit polls, no nothing.  Until all the votes are counted, the British media is forbidden to report on it.  So Thursday is the last day that the markets will function as pre-brexit markets. Are you ready for more of this…

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SPX – Not very dramatic so far, but it is holding above the 50sma and remains close to former highs.

SPX 6-22

What else have we seen this week?

 

VIX – Actually the VIX looks bullish, which would normally be calling for a drop in the markets. I cant say what is going to happen, but I dont feel extra comfortable being long the markets with the Vix looking like this. If this didn’t change on Thursday,  I wouldn’t be long the markets going into Friday.

$VIX

USD – This is important.  The USD is acting pretty weak and (So far) topped on day 6 of the second daily cycle. If this breaks below the DCL lows of June8th, this is failing in a big way. The chart is considered ugly at this point. Brexit vote could change this or juice it. I’m watching 95.54 highs and 93.39 lows.  ( EDIT: I believe the $USD failed overnight, cutting below these 93.39 lows. This calls for the USD to drop further, that may push Gold higher)

USD 6-22

 

WTIC – If you have been with me for a while, you know that I was calling for $40, then $50 , then $60 in Oil from the $26 lows.   RIGHT NOW, this is a tad weaker that I expected coming out of the 2nd daily cycle lows.  Can it improve? Yes, it is very early, but I see a tad more weakness than expected, and I will monitor this going forward.  NO BIG DEAL here, it is only day 4.

WTIC 6-22

I was asked for a chart of LGCY and advice when to buy.  It is not a bull flag anymore, because a bull-flags length  will not exceed its pole. This is now a consolidation of huge gains.  Remember, when we caught this one in April, It gained almost 600% in 2 months ( .70 to almost $4.). Now it is consolidating those gains.  It is oversold, but it may also still back test the break out ( red line). I see it struggle against the 10 sma for weeks.  Look at the chart and the 10sma green line = A safer buy is a close above the 10sma in a big way or for 2 days. An even safer buy than that is a close above the 200 sma.

LGCY 6-22

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NATGAS – I thought that NATTY might be toppy and due for a pull back soon. I think we are there. so…

NATTY 6-22

FOR EXPERIENCED TRADERS ONLY,  DGAZ is a 3x etf. I dont usually recommend 3x etfs, but this could be a 3 or 4 day trade for the experienced.

DGAZ 6-22

Why experienced only?  Seriously, I have seen traders buy & hold a 3x ETF that quickly goes against them for many days , and they do not cut it loose. This trade could go against you quickly with BREXIT VOLATILITY.  Only experienced traders seem to know when to cut the trade for a loss. Riding & holding a 3x etf to 20% loss or more is dangerous, and that can happen in 1 day with 3x etf.  Then the next day is another 15% loss and it just gets really ugly.  I cannot walk anyone through a 3x etf trade. Use at your own risk.

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For me: I buy it as a trade, and I sell it if it does not do what I expected when I bought it. Timing is critical, entry and exit is critical. Enough said.

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GOLD & MINERS

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So this is GOLD- This chart tells me that right up until Wednesday,  Gold remains bullish in this pull back. I even see a possible inverse H&S forming, and the 50sma is at $1259.  Could Brexit drop this below the 50sma? Yes, anything can happen, but I’d rather not see it close below the green line ( 1249).  $1201.50 is the ICL, that must hold or we’d have a failed cycle. Gold is not oversold.

$GOLD 6-22

Let me show you 2 charts using technical analysis,  and these charts show a bullish and bearish path. This is not to confuse anyone, it is to prepare us for what could happen.  Thursday is the day before we know how Brexit plays out.

 

GOLDS HRLY CHART – Dropping to $1260 is the 50sma on a daily chart and fits this falling wedge.  That is bullish. This looks like a break above $1280 is a break out.

 

GOLD 6-22 hrly

 

Golds Hrly chart –  Head and shoulders shows me that Gold could plunge to $1240 after brexit and fulfill this chart. This is rather bearish cycle wise. There is actually reason to believe that this H&S will be negated, but I thought that it needed to be shown to prepare readers. I have been told by some that due to their trading style, they prefer to wait until  AFTER THE VOTE to enter Miners. That is a good plan too (safe).  So…

 

GOLD HRLY

So going back to Gold- This looks like a 1/2 cycle low to me.  A break below $1248 would be more concerning concerning if Gold closed there. A close below $1201.50 ICL lows would be a failure. I doubt this will happen.

$GOLD 6-22

 

GDX-Tuesdays chart pointed out a possible back test. Would that hold?

GDX 6-21

We saw a reversal on Wednesday in Miners. This chart remains bullish, and … 

GDX 6-22

Notice that Other Miners also held up well in Golds recent selling, and put in a reversal on Wednesday.

AUY 6-22

HMY 6-22

EGO 6-22

See also BTG, IAG, GFI, AUMN, AU, AEM and many more. In fact, some stocks with reversals like AEM and RGLD have hardly pulled back and remain near highs, so I have to wonder, is smart money accumulating these?

AEM

AEM

RGLD – Cup & high handle?

RGLD

So today is Thursday, the day of the Brexit vote, but we wont get word of the results until after the markets close. My analyses leads me to a bullish conclusion, but we all know that markets can have knee jerk reactions. Friday could have various sectors exploding higher or lower, with the real move eventually coming about later.  I am positioned Long Precious Metals, but please know your own trading style and position yourself in a way that you an handle any possible whip saw, volatility, etc.  Some should just have smaller starter positions, others may want to wait until the next moves begins. Maybe Thursday heading into the close will give is a clue as to what smart money is doing?

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~ALEX

192 replies
  1. Cason
    Cason says:

    Gold hit $1259.50 early overnight then $1257.50 later, banging of the 50 day. Fasten your seatbelts, this is going to get bumpy!

    • chartfreak1
      chartfreak1 says:

      Just seems kind of too easy with a tag of the 50sma, doesn’t it? I liked it when everyone was waiting for a tag of the 200sma and missed it better.

  2. Edward Bernhart
    Edward Bernhart says:

    If the vote is to stay it is hard to imagine, IMHO, that it would be negative for gold, since the dollar would go down or remain unchanged, if the inverse relationship applies gold to dollar. However, if the vote is to exit, the dollar would get stronger but how much would the flight to safety prompted by uncertainty prop-up the falling price of gold?

  3. SonOfGud
    SonOfGud says:

    Bookmakers have it a near dead cert against Brexit..
    Big money is on Remain.. but gotta remember that each punter has a vote too
    REFRESH … F5

  4. Alan
    Alan says:

    I read somewhere that Hedge funds are doing their own Brexit polling. They can’t release results before voting ends but they can trade based on what they are seeing. Market action may give us clues.

    • chartfreak1
      chartfreak1 says:

      At the moment, yes. The markets have moved higher each morning and sold off into the close, so we’ll see if it can hold the gains today. If it sells off, the VIX may rise.

  5. chartfreak1
    chartfreak1 says:

    So I think that the Final vote count can be released after 3 a.m. Eastern time . Anyone staying up or setting their alarm : )

    I’ll probably still sleep until 5 a.m., to let things settle a bit. Nothing we can do trade-wise at that point.

  6. chartfreak1
    chartfreak1 says:

    I believe that I mentioned this before, but TRQ was a valid break out on a weekly chart, and should just continue higher to $4.00.. Slowly but surely, it has done that.

    .

  7. chartfreak1
    chartfreak1 says:

    IPI pushing higher with good volume, over 1 million in the first hour. . Maybe it will head up into that over head gap on a daily chart.

    1 yr weekly chart looking good too.

    • CS
      CS says:

      I like that frypan bottom forming on CLF, Alex. I made a nice return with that pattern recently with X and I may have to pick up some CLF for the same reason. CLF’s recent chart had several occurrences of that and it worked out well, though there’s nothing that works every time.

      VALE also keep chugging along (I have a few shares). Will be watching X over the next week hoping for another frypan bottom pattern there as well.

    • Cason
      Cason says:

      CF, what are you thinking for CLF? Move back near highs of $5.83 seems possible doesn’t it? Looked good today.

      Has anyone been watching copper? I haven’t heard much news on it, but it is really rocketing higher this week!!

  8. Bill
    Bill says:

    Alex, whats your thoughts on BAA? I am in it, I can get out with a small loss. It just doesn’t seem to be running with the others?

    • chartfreak1
      chartfreak1 says:

      pretty much neutral, it seems like it could go either way. hardly any volume one way or the other.

      You know as soon as you sell, it’ll take off 🙂

      • Bill
        Bill says:

        Alex, Give me a trade here. Who do you like today. Im going to sell BAA and want to hold a trade a couple weeks anyway

        • chartfreak1
          chartfreak1 says:

          Tough to know- I havent really been looking for a trade set up. I would have said IPI at $1.60- because I think it’ll run to $2 fairly easily, but if you look at that chart, its in a pattern of big pops, and then drift down, big Pop, drift down. I dont know if that will keep happening , or is it breaking free today with strong volume.

          It looks like a break away.

          That WG that Bob S mentioned looks pretty good.

          If Gold breaks higher and TRX follows, look at that 2 yr weekly chart.
          If Gold breaks higher, I also like SAND set up
          and how about that NRP chart 🙂

          GST?

        • Cason
          Cason says:

          Energy, man! WPX is a laggard right now but was HOT! on the 2nd daily cycle run up. I’m also in BTE, OAS, CWEI. OAS might work. CWEI already left the station, though. Glad I was on board first. Choo Choo!

  9. Rob
    Rob says:

    Alex, my POU.TO broke out yesterday +7% and is up another +2% today. Dont like the look of today’s candle, but maybe it will test the breakout area.

    • chartfreak1
      chartfreak1 says:

      Hey Rob

      Yes, It depends on if you are in it for the long term or just a quick trade. It looks to have broken out on lighter volume and I find that it is unsustainable if a big surge doesnt come in ( buyers drying up) , so it can fall back to test or get back inside the consolidation.

      The weekly chart looks great ( except that it too has light volume on the break out).

      SO I dont view this as a failure, it just isnt enough to sustain the break out and will have to try again later.

    • R Byram
      R Byram says:

      Rob – re Paramount – I don’t have the chart or the fundamentals in front of me – but do know that this is a Clay Riddel company – a highly respected Calgary Oil billionaire and probably the only reason this overly indebted company is still in business. The other Riddell company you might look at is Trilogy – they have lots of good stuff going for them. I don’t know what the latest is on the debt or fundys, but unless things have changed you are dealing with a ton of debt here. Again no direct knowledge, but I think these high debters can move on short covering sometimes.

  10. Crystal
    Crystal says:

    Wow .. NADL.. This one is the one that always outdoes my other oil stocks and it also is the one that I happen to have the fewest shares of 🙂 🙁

    • Cason
      Cason says:

      As long as you have some! Same, the only energy I didn’t double down on – CWEI – WAY outperforming the others

  11. chartfreak1
    chartfreak1 says:

    IPI – this is why Jesse Livermore said that he made better money sitting tight than plunging, when he knew he was right.

    If a stock is acting correctly during a consolidation, when it breaks out it has energy to burn.

    That is a great base, I hope it keeps running for all of those still in it.

    • nancytheartist
      nancytheartist says:

      I came home from work to find I am finally out of the red! How about a lesson on what to watch to know when to get out?
      Thanks CF.

      • Cason
        Cason says:

        Woo Hoo!! Doesn’t that always feel nice! I know what you mean. I am up BIG on CLF right now. I think it could get back to high $5s again, but I took a full round trip once. I won’t be doing that again, ya know?!

    • Cason
      Cason says:

      I thought it would NEVER get through that resistance at $1.67. I had decided to sell it, but thank goodness I held off just a day longer – I had moved up my stop but didn’t sell. Whew, that was close! I had a small position, but will be happy to take home another winner here!

  12. GOLDSA
    GOLDSA says:

    Alex – thoughts on CJES ? Do you think it can make move from .87 to 3 dollars, possibly ?

  13. SonOfGud
    SonOfGud says:

    wow anyone watching Brexit vote count?… early results totally against the remain-win poll predictions.
    £££ is crashing against $$$!
    gold is up £40/oz

    • Cason
      Cason says:

      What?!?! Serious? No, not watching but going to look it up now. But not sure how to buy gold in Sterling myself. I’m sure Gartman is excited (assuming he’s still alive).

      If I was a betting man, I might have grabbed a few really cheap GDX calls. Wait, I am a betting man…

  14. R Byram
    R Byram says:

    what am I missing here – I watch the Kitco 24 hour spot bid and it is up $2 from the open – from 1265 to 1267. Is there something more accurate I should be watching?

    • Rob
      Rob says:

      I have gold at $1283 at TD Waterhouse. I am looking at Kitco too. They have a listed price of $1280

      • Cason
        Cason says:

        I watch at pmbull.com Gold has moved at one point from 1250 to 1285, which is a total $35 move. Pound has moved 7 cents from low to high. Whoah!

  15. Tammie
    Tammie says:

    The dollar and gold both going up tonight….dollar up $1.18 right now…..has gone up several cents in just the past few minutes……? At least gold isn’t plunging while the dollar is rising….ok, before I could even post this the dollar is up $1.24 now…wow…..!

  16. miller
    miller says:

    Yeah DOW futures down over 300 as of now, OIL off $1.45, Gold up $17,, see how it all plays out in the morning. ,,Plunging faster than I can type and gold driving higher.

    • Cason
      Cason says:

      Alright all you Cheeky Brits, don’t drive S&P down too much! I’m really having a good time with my energy plays and don’t want the party to end yet!

        • chartfreak1
          chartfreak1 says:

          I’ll have to see what the morning brings, but I have expected this move, and we are in the first daily cycle of a new intermediate Cycle, so I was expecting $1400+ to $1500 by the time it ends.

          They haven’t been selling off the Miners , even with Gold losing $50 . BTG, SAND, RGLD, AEM, etc still up near highs when Gold sold off. They may just break out & run.

          I did NOT expect OIL to be bothered one way or the other though. Not sure how this whole thing will play out going forward. I dont know if anyone on the planet expected these moves so quickly.

          • nancytheartist
            nancytheartist says:

            I had been looking to add…did some… but too late now! I never know when to let go though and not be greedy.

          • chartfreak1
            chartfreak1 says:

            I am a little blown away at this. I thought in the back of my mind that they would sell gold off all the way to the vote, and many would see that and start to short Gold, so the next day ( Friday) would see gold run up, and no one would dare to buy going into the weekend. Could be a lock out, since I see the ICL in place.

            I certainly didn’t expect this type of lock out. Who will buy tomorrow if Gold is up even $30? Everyone will fear a pull back. This is pretty big at this point.

  17. nancytheartist
    nancytheartist says:

    It is 11:06 pm ….looks like a tight race but looks like the exit is happening. Dow futures now down -525 gold up 1307 !!! up about $43!!! Yikes.

  18. Siva
    Siva says:

    Dear Alex
    You mention it’s too late to buy metals and miners after the voting / on Friday. Looks to be you are absolutely right.

    • chartfreak1
      chartfreak1 says:

      I hope some at least bought something. I was pointing out that BTG and SAND look a lot like VGZ and MUX before they broke out because some Miners aren’t too far above the 200sma. TRX had a great base, etc. If Gold hangs up here, these Miners could have a great 2nd run, but who would dare to buy on Friday?

      It kind of feels like a lock out & maybe smart money was buying ( And us).

  19. nancytheartist
    nancytheartist says:

    I have on Fox Business news…love Carlton Varney’s take on UK news because he is a Brit.

  20. chartfreak1
    chartfreak1 says:

    Honestly, I cant tell if I’m going to wake up to Gold up $100, or Gold up $70, and back down to down $30.

    I – CANT – Go – TO – BED!!!

    • Maria
      Maria says:

      lol…
      same….. im afraid … verrrrrry afraid what i might look like in another 5-10 yrs down the road…. yikes.
      Hello .. my name is Maria ..and I’m a shameless addict…

    • nancytheartist
      nancytheartist says:

      Remember the other day you showed the short side of Gold…the thing that made the little men in Maria’s head run for the windows/doors? Are they going to get squeezed in addition to this crazy movement? It could be NUTS in the morning!

      • deshy
        deshy says:

        Thought it was just me…but good to know it affects even the seasoned 🙂 I think the main act is over for now so going to get some shut eye. Happy, shiny dreams…hopefully won’t be disappointed in the am!

      • Dave
        Dave says:

        Thoughts on how this might affect miners in the immediate and medium term? If they get caught up in the selling tomorrow, do we use that as an opportunity to build on our core positions (I’m long on IAG, AUY, and KGC). I know you have said that we are early for an ICL in miners despite one being set for gold.

        • chartfreak1
          chartfreak1 says:

          Miners did not pull back when Gold dropped $50.

          I think they showed strength and accumulation. I dont think they will sell off with the markets, I think they will be safe haven and higher with Gold.

          We’ll see

          • Dave
            Dave says:

            and my investment account is happy. with that said, are you buying following that 8% jump, or do you think we get a pullback into an ICL in miners before we blast off even higher? Alex has made the point that the cycles in miners have been about 1 mo delayed from those in gold. If we just printed an ICL in gold, do we wait for one in Miners, or do we throw cycles to the wind right now and buy with both hands?

          • Cason
            Cason says:

            Huge gap this morning and CRAZY move in currencies so I’m going to wait for more data before I add. If pull back any today, maybe but will look for better entry next week, personally. This is a Heck of a move!

  21. Crystal
    Crystal says:

    I think I posted this earlier in the wrong place, but the Russell FTSE Is ringing the closing bell on the NYSE tomorrow

  22. nancytheartist
    nancytheartist says:

    It has been fun watching history unfold with all of you fellow night owls…..I am off to bed. Will be dreaming of all the green we all shiny stuff lovers will see tomorrow…..and think of the short squeezies too!

  23. kathleenchow
    kathleenchow says:

    Alex, I have a nice core in miners and silver, but also holding energy – CWEI, ERF, ERX. It is puzzling why oil got hit so much. Please discuss in the next report? Thanks:)

  24. Cason
    Cason says:

    Not sure what Alex will have in his report yet and not sure what kind of reaction we’ll have to this BEYOND Fri open. BUT for my non-gold stocks, I have removed my hard stops to include other miners – CLF, X, etc and energy. I don’t want to lose my shares in a landslide open that could then stabilize. So suspending energy stops for at least half hour. I like the tech setup still, but $$ is crushing crude. GL all, this is just nucking futs.

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