October 4th – Good Energy

/133 Comments/in /by

Lets take a look at what appears to be some good energy.

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 WTIC –

As expected, Oil is following through to the upside. Sitting near the August highs, it could form a handle on this mini cup , or it may just power higher to the June highs.

wtic-10-3

NATGAS – Natgas has been making bullish higher lows since the spring. After breaking out, it now looks to be finding the next dcl. I’m not acting on this yet, just watching for a low.

natgas-10-3

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GOLD –  No change from the weekend. Gold is actually back at the lows and the daily cycles can end anywhere here or even up to 30 or so days. That actually means that this ‘chop’ could continue, or we could just drop rapidly into a low  ( DCL or ICL).

gold-10-3

 

GDX – No change.  GDX broke down and recovered, but this is not important at this point.

gdx-10-3

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So what has changed from the weekend report?  Nothing at this point. It has only been 1 day, so I keep the same expectations as I had in the weekend report. Let me share a few trade ideas in the energy sector though.  Since I already had several energy stock set ups to consider in some of last weeks reports, I just want to add maybe 5 more here.  Remember, if you are waiting for GOLD to bottom, you can wait in cash and you do NOT have to take a trade, just because I point a few trades out 🙂

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Lets just start with a review, before we get to new ideas.

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OAS –  When I pointed out the lows in Oil , I recommended OAS, AREX, CWEI, RICE, ETC  August 4th and 5th.  Then it was ‘buy the dip if you get one’.

OAS 8-5 d2

OAS – That was a quick dip to the 200sma and off it went. Now after a long consolidation, these are taking off again.  IF YOU WANT THIS LONGER TERM AND YOU SEE A BULL FLAG,  buy it ( Or add here and now). Why?

oas-10-3

OAS WKLY – Longer term this has potential.  I pointed this upside potential out last week too.

oas-9-28-w

 

AMRS –  AMRS is pushing through a resistance area. As a review, I have owned this and had several buy points along the way. It remains a very good looking set up, with solid upside potential. Here I am pointing out the 2 day drop 2 weeks ago. Since then it ran up over 25%.  If you see another pullback here  ( to the 10sma)  it could be considered a buy.  I have added enough that I will not be adding again. 

amrs-10-3

 

ERF – Reviewing ERF from Sept 28.  Good news is that it has not Run Away from us yet.  It was  around $6.00 as a buy at this support reversal.

erf-9-28

ERF – It may be ready to take off however. It is breaking above the 50sma and a downtrend line. It could be bought here with a stop under the trend line. 

erf-10-3

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NEW STUFF-

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SDRL–  This was a huge pop.  You should look at SDRL on a 1 yr weekly. Please read the chart, this is a buy right here on the 10sma.

sdrl

AAV –  This looks to have held up rather well in Oils sell off, just breaking slightly below the 50sma and then recovering. It is near the highs again, and looks ready to break out. 

aav-10-3

I wanted to point out the charts of DNR & WLL.  They both look good and they both look the same, So…If you see one take off, maybe the other is next?  🙂   (  By the way, I bought DNR a few days ago, not so ecstatic about that purchase yet, but the set up is still bullish).

dnr-10-3

wll-10-3

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 HERE IS THE GOOD STUFF

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I found maybe 15 good set ups, but I wanted to focus on just a few tonight. 

I really like the next 2 charts set ups ( 4 charts, because I will show a daily and weekly for each). I cannot guarantee anything here, but these set ups are good.

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JONE  DAILY – This could pull back, but it also might just take off.

jone-10-3-d

 

JONE WEEKLY –  This ran from $1 to $5.  And when it takes off , couldn’t it go from $3 to $20 eventually?

jone-10-3-w

HLX DAILY – $2.50 to $9 and then a long consolidation that shows up as an inverse H&S to me.  It just ran from $6.50 to $8.60,  so is it too extended to buy?  It might pull back to the 50sma, but…

hlx-10-3

 

HLX WKLY –  This is a 6 month consolidation. These can be great trampolines to higher price.

hlx-10-3-w

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Conclusion: Cash is a position, and some may want to simply wait to see if we get the ICL in Gold & Miners soon. Others want trade ideas, and energy is looking promising.  These set ups are for those looking to trade the energy sector. We will have to see if the rest of the week gives us a clear idea of what precious metals and the general markets want to do. Thanks for being here and happy trading!

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~ALEX

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P.S.  Guess what hit $91+ Monday?  I could cry. I watched this run straight up from $6 to $13.  Then we  got an entry point, and most doubled their money to the $30 area.  The consolidation area was quite boring.  Chop Chop Chop, right?  Look how that paid off  ( I sold out). When I show the weekly charts of OAS, JONE, HLX, and the long choppy consolidations in Miners, it is to keep the longer term picture in view. The break from the consolidation in the $20 area was explosive and relentless.

cwei-10-3

133 replies
  4. R Byram
    R Byram says:

    Re Jone -fundamentally it is WAY better than many other oil stocks – operating in a very profitable area in Oklahoma.

  6. Bill
    Bill says:

    Will GDX hold at the 38.2% or slip down to the 200sma? Big questions, timing is key. Don’t catch the knife.

    • Chris
      Chris says:

      I would love to see it probe a bit nearer the former major breakout level around 23.0 or even the 50% retracement around 22.25! But a retest of that brekaout level prior to a major wave 3 move would potentially be an absolute gift! 🙂

        • ray
          ray says:

          found this from one of those EW guys

          current measured move target would be 21.70 where C
          =A for GDX, decent target,

        • Chris
          Chris says:

          If we’ve just seen the first major wave 1 up from the Jan ’16 lows to the Aug ’16 highs and the first of a major new bull cycle then under EW theory, wave 2 is permitted to retrace up to 100% of wave 1!! That’s the theory! Personally I’m not expecting that and on my very long term charts I tend to use a 60 week/300 day EMA to determine the major long term trends and the likely extent of the deepest pull backs in a bull cycle. In GDX these currently lie around 22.5/22.8 and almost bang in line with the 50% retracement. That would be my pesonal favoured area for another major low. Spikes below would be possible but IF they did occur should ideally be VERY short lived. In gold itself those EMA’s currently lie around 1250 & 1270 so that is my favoured target/support area for gold itself and where I would personally be looking to add in a large way at the first hint of bottoming.

      • nancytheartist
        nancytheartist says:

        I got antsy and took a small starter position in HMY…will add more if it drops a lot more. As usual, I moved to quickly and have another red position to add to my collection!

          • nancytheartist
            nancytheartist says:

            I really wanted to start a position in that one so will add if we cascade lower…right now a very minor loss. Now I have to turn my attention to more pressing matters…Hurricane Matthew is on the way and the track is moving closer to Vero Beach now instead of away. May have to board up for this one.

      • Bill
        Bill says:

        Ken, my hands are just now healing from catching those knives. I was lucky enough to get out quickly.

        • Ken
          Ken says:

          This is a normal correction Not a “falling knife”……this is where you start considering opening or adding to positions.

          • Chris
            Chris says:

            Would definitely agree Ken. Having missed a chunk of the first run I’ve been PATIENTLY waiting for what feels like forever for a signficant pull back/correction and would agree we are very likely much nearer the end of it now than the beginning. Very likely closing in on the ICL Alex has been highlighting for weeks. Even if we are early in timing we are likely not far off in price levels and I added some thoughts on those to Bill earlier in the comments section. But that is not so say we could not have a mini-bout of climatic selling before those lows are in!!

          • Ken
            Ken says:

            Could not agree more Chris.
            How is that golf swing coming ? 😉 I am most likely getting in my final round this afternoon in upper lower Michigan.

          • Chris
            Chris says:

            We play all year here…well not me!! I’m definitely a wimp when it comes to playing golf in the cold and wet!! 🙂

          • Chris
            Chris says:

            There have definitely been some more promising rounds this year and I managed to lower my handicap a little this year from 7 to 6 which was quite pleasing. A bit like you though our season is getting near the end as I’m definitely a ‘fair weather’ golfer and pretty much hibernate as the weather turns colder. But still having some lovely ‘spring like’ weather at the moment so having a game with a few friends on Thursday. Was glued to the Ryder Cup over the weekend, which had some of the most amazing golf I think I’ve ever seen and which I have to say the US richly deserved to win. Absolutely amazing to watch even if we were on the losing end this time.

          • Tammie
            Tammie says:

            Good to hear….maybe I can add to a couple of things and come out ok…:) I held FSM and well….not so good today….:( kept thinking it was going to come back….have a couple of others too that are in the same boat…

          • Bill
            Bill says:

            Ken, please, Im referring to my buying NUGT last week only to sell quickly. THAT IS catching the falling knife. Getting in too early…………

          • Tammie
            Tammie says:

            I hardly ever get the leveraged funds….been burned in the past……but…yesterday I kept looking at the dollar chart and it just looked like a rising wedge to me so couldn’t help but think…it’s going to fall….stared at it all day…then finally decided to get some JNUG thinking I was getting a good deal…hahahaha….everyone who wanted to get that at a good price can thank me for it…..I buy, it goes down more….:) Now today is probably a good deal……

          • Bill
            Bill says:

            Ken really? Alright, catching the falling knife to ME, is buying tooo early during a move down. Granted I am not still holding and suffering a big loss, but buying too early is what I meant. Your definition?

          • Bill
            Bill says:

            Ken, I interpreted “Catching a falling knife” as buying to early in a sell off. Your interpreting the “Falling Knife” as identical to a waterfall decline? So,”catching it”, would be buying it too early. What is the difference between that and what I described? #stickler

          • Ken
            Ken says:

            “buying too early in a sell off” is Just that…..You bght. too early in a sell off !!
            Your claiming todays 3% corrective down move is a “falling knife” ….. 3% !!!!! (gold)

          • Bill
            Bill says:

            Ken, LOL!, you’re such a stickler for details yet you misspell “bought”? I am an engineer by profession and typically use the correct verbiage for technical discussion. I am not a professional with regards to trading and do not spend much time deliberating over the exact definitions of trading discussion terminology. My posts seem to be abrasive to you for some reason? Just don’t respond to my posts if they bother you! #BIOYA

          • Ken
            Ken says:

            Dude if your going to offer trading advise and you use terms i.e. Blood in the Streets Or Don’t try to catch a falling knife when the underlying is only down 3% that day That is misleading to others and very dangerous.
            Btw. … If your going to give trading advise State your trades in real time not after the fact….then we can all follow you.

          • SonOfGud
            SonOfGud says:

            ok guys.. pistols at dawn…
            i like both yours & Bill’s ‘trading advice’ posts.
            i personally dont care if its ‘misleading’ as i use it more of a pointer to check-up on stuff myself.
            if that was the Rules, i’d never get to post here 🙂

          • Bill
            Bill says:

            Ken, DUDE? What are you, Mott the Hoople? First off, I did use Blood in the Streets. I used it when the market was down considerably. Maybe not the perfect definition of it, but its the way I felt at the time. 2nd, I used catch the falling knife, again as I felt at the time. I said that “my hands were healing from catching the knife”! I in NO WAY advised anyone to make a trade, follow my advice, or jump in because the timing is right. I am not giving advice ( or advise ) I am just stating my non professional opinion, observation, etc. As far as trades, I do post my real time trades on occasion. I usually post on Trading View, you can see the trades I have taken with time stamps. Sometimes I’ll post a link here as well. As I said, these are my opinions, I believe most of us share our opinions. Someone will say, I’ve followed XXX a long time, solid management. Someone will show a chart of EW with a target area. Someone will say I have been following XYZ it looks ready to run. You seem to just have issue with my posts? Remember, just say no! Don’t respond or comment. #BIOYA

          • Ken
            Ken says:

            That is the point !!!!…..You trade off your “Feelings” and then State them here as trading advise, you are very dangerous imo.

          • Bill
            Bill says:

            Ken, I don’t think I give anyone advice, I say when I am buying something, sometimes? Is that advice? I say I think this or that is happening, is that advice? You’re going to have to cut and paste a quote I made where I said, “I recommend you buy”, or “You should follow my trade” for me to see how you think I am advising everyone here. Why are my comments dangerous, prove it to me and don’t misquote me like you did above? #BIOYA

          • Ken
            Ken says:

            BTW….. If you are buying a 3x ETF and you get a 10 – 15% or more correction It Will FEEL Like A Falling Knife because your acct just took a 40% hit but in actuality it is just a normal and healthy correction in a bull market.

          • Maria
            Maria says:

            ok good.. now that we have that longass definition out of the way… ;o) (i thought for a second there i was gonna have to make a KenMariaPecos sandwich) MEEEEEoooowwww)
            anyway…. i cant remember your count on GDX .. do you have it currently completing “2” or “4”
            I can count both ways….
            ie. here’s nugt
            https://www.tradingview.com/x/SM7L6uQD/

            and here is my old GDX chart from August — that i still like ..
            https://uploads.disquscdn.com/images/d29f095266b13cb9cf97d1ea8c110dd92d0bd8017d8fad865008b26b6e73feed.png

          • Chris
            Chris says:

            Still treading gingerly with ‘adds’ because although we’ve started to hit my target areas I’ve yet to see ANY evidence yet that we are actually making a low. Even on my four hour charts they are still solid red candles. They are still ‘falling knives’!! Lol 😉

          • Chris
            Chris says:

            I’ve already covered that point with Bill in some earlier comments. But you are absolutely right and even though my target areas are starting to get hit, there is no evidence of lows forming yet! So as they say, ‘ gently, gently, catchee monkee’!! At least they say that in this part of the world!! Lol

          • Chris
            Chris says:

            No…lol…it’s just a phrase I know and assume it might be one that the english use but not sure about americans. No idea where it originated but something I seem to have always known!! They have monkeys and gorillas in Jersey but only in their zoo so I expect that doesn’t count!! Lol

          • Chris
            Chris says:

            I’ve actually been here every day….watching, learning and waiting, waiting, waiting very, very patiently for this next hoped for ICL having spectacularly sold out too early and missed most of the last one!! 🙁 🙁 But hopefully all good things come to those who wait and as hard as it has been to wait I’m now just starting to ‘lick my lips’ at what is starting to be put on offer!! 🙂 🙂 Lots of cash to deploy and starting to feel like the little boy who has been let loose in the sweet shop!! 😉

          • Maria
            Maria says:

            idk.. that’s just an observation.. i could be WAYYY off..but dammmyum … gaps are usually in the 3rd of the 3rd … which can be a 3 or C .wave… hmmm

          • Chris
            Chris says:

            Anything is possible especially in those x3 leveraged ETF’s and even if it was only a viscious intra-day spike!! After weeks of chop, chop, chop we are starting to see some real acceleration to the downside now (potentially into at least a DCL and maybe the ICL) and we’ve maybe forgotten how sharp some of those drops can be even if they end up relatively short as well. I’m only looking to add to actual bullion right now as that is for long term buy and hold and is now at or very close to intial downside targets I had in mind. The stocks I’m still watching like a hawk for some signs of a low developing, which may be around these levels but could be quite a bit lower yet! Bullion and stocks don’t have to turn at exactly the same time. Don’t forget that!! 😉

          • Cason
            Cason says:

            Yeah a bump in GDX tomorrow/drop in DUST, would be a bear/bull flag, imo (depending on one’s point of view).

          • Cason
            Cason says:

            don’t go gettin’ all confused little Missy. Yeah I (very smartly) bought DUST to hedge with, but I’m looking for the long side. I ain’t no bear!

          • Cason
            Cason says:

            Bill is right, man. NUGT was down 29% today and 40% on the week. Absolutely a falling knife.

            Different now in a bull. In a bear, this was a START to the pain. In a bull this is a FINISH (to wave 2, imo) and almost time to Buy!

          • Ken
            Ken says:

            Cason NUGT is 3X what else would you expect.
            See my post below….
            You get a 3% move in a day ,which is not abnormal, and you see a 9% loss yea those ETF’s have deep moves all the time.
            The underlying is what you time off of. Sigh

          • Cason
            Cason says:

            Yeah, I know – I get it. I never chart the 3x ETF, only work off the underlying. Except for sentiment. Those 3x can really get the more emotional traders moving. Gold is often a sentiment trade. Agree on the bull market pullbacks. And also why I haven’t had a NUGT or JNUG trade in awhile either. Ok, you and Pecos can kiss and make up now that Maria have intervened.

  9. Chris
    Chris says:

    With silver dropping nicely into a likely DCL if not a far more significant ICL as Alex has been highlighting for weeks, here are a few levels I’m watching carefully in case of interest to others. 1803 – major TL (trend line) from Jan lows, 1787 – prior breakout area, 1775 – 200 day ema, 1739 – 50% retracement of Jan-Jul bull move plus 300 day ema. So 1740/1800 provides a rather appealing target area in my book to watch for potentially important lows to form in silver and we are already probing the top of that area. 🙂

  11. Rob
    Rob says:

    If Alex has been away from his computer screen since the open, I’d love to be a fly on the wall when he turns on his laptop. As he had predicted, a slam down but still $-40 for gold is tough to swallow. 🙂

  12. Glmus
    Glmus says:

    Re catching falling knives: I am not a great trader and concentrate on capital preservation. Someone wrote many days ago wondering if it was time to buy AG (which is still falling). When we have nasty down trends, I use the WEEKLY close above 5EMA and the RSI2 close above 50 (yes, RSI two). These keep one from getting too antsy. These two indicators also work to the upside in the reverse way. AG is a great example. Catch a ‘bottom’ on 2/5/16 and sell the ‘top’ on 8/19/16 for a 3 1/2 bagger. Check these out on your charts. Once a weekly trend is established, then I will use these same tools on a daily basis to go with the trend. I hope this is helpful. Obviously one doesn’t catch bottoms or tops. Maybe Alex can help us when he sees obvious ones.
    Gary

    • Chris
      Chris says:

      Hi Gary. Talking of AG, one that I am actively tracking, I also make use of very long term EMA’s such as 300 day and 400 day to monitor likely limits to major bear rallies or pullbacks in bull runs. Possibly worthy of note is that after AG topped out in Dec ’12 the first major bear rally after the initial drop topped almost exactly at the then falling 400 day ema. Now we are in a bull cycle as I believe we are, it is interesting that the first major pull back in AG has just reached the now rising 400 ema as well as a 62% retracement. It will be very interesting to see if we now start to get any evidence of lows forming followed by your buy signal. That would make one ‘sweet buy’ potentially especially for a longer term buy and hold IMO.

      • Glmus
        Glmus says:

        Thanks, Chris. I have added an 80 weekly EMA to my charts so I can go back to 2012. It caught some nice near bottoms in Jan/Feb. I just looked through most of my metals to see where they are with respect to this EMA recognizing today is Tues not Fri:
        TAHO smashed through it, SA, NG, SAND, AG, HWY, ABX are basically sitting on it, DRD, GFI, AU, IAG are closing in on it. I will keep an eye on these.

        • Chris
          Chris says:

          You’re very welcome Gary. The 60 wk ema seems to work expecially well with gold and silver bullion. With the more volatile stocks if the 60 wk doesn’t hold the 80 wk frequently does especially once a major long term trend is becoming more entrenched. We are still in the ealry stages of this trend which will hopefully be multi-year so sometimes you will get brief moves back below even those long term ema’s in the early stages. However, if it’s a tue bull trend they should be quickly recovered and then offer support. Obviously the usual caveat applies with individual stocks which can get into trouble no matter what the bullion is doing! So if a stock starts spending too long under those long term and ideally rising ema’s then it may be a real warning sign. So tight stops if you ‘bottom fish’ or wait for the ema’s to be recovered. But ultimately only one more aid. I still haven’t found the ‘holy grail’ indicator!! Lol

        • Robert
          Robert says:

          Gimus…. I apprecate your chart studies. but I find it hard to follow…. is there anyway you could show us a chart on how you use these indices? many thanks

  14. Cal Staggers
    Cal Staggers says:

    GDXJ has pos. RSI divergence finally on 15min chart, which may play out tomorrow even if we get a gap down opening. Seems like a good place to buy a tranche and save some powder for the later in of the week

    • Ken
      Ken says:

      Yep agree.
      If gold and silver gap down tomorrow I will be adding the other 1/2 tranche in SLV.
      Possible ICL Alex, seems a tad early?

    • Cason
      Cason says:

      A big gap down might be a buy. I’m not ready for leverage yet but could start buying single miners soon.

      Jobs Report is Friday. Best case scenario is a short bounce (bear flag) with a washout low on Friday, Boom a reversal and we don’t look back. I can’t imagine anything better!

      400-day EMA and gap fill are only a few points below in the high $22.xx range. 200-day is another 60 cents below that. Serious support, I’ll buy if we get there even without a reversal.

  15. Thomas Yarbrough
    Thomas Yarbrough says:

    reasons I believe its a gold miner bull
    1. When silver outperforms gold as it has recently it tends to signal big runs in the miners
    2. There is still a lot of mean reversion to go. We are about at the level of this time in 2013 which is still way off the highs. Granted the blow top of 2011 was pricing in gold never dropping
    3. Improved cash flows and leaner companies than a few years ago
    4. The case that I won’t try to summarize by Marketanthropogy that uses a variety of chart analogs and musing about interest rates.
    5. The charts and ideas about cycle lows that the chart freak has given of here.

    Perhaps there is some wishing and confirmation bias in my thinking but that’s the way I see it right now

  17. alain
    alain says:

    my stop got me out of my 50% position on USLV at the open , always hard to see a winning trade turn into a loss ,but that’s part of the plane ,nevertheless the charts have been damaged, so until more appealing configuration I am on the sideline .

  19. Crystal
    Crystal says:

    I know not everyone likes sub $5 or sub $1 gold stocks …. but I am starting to look at some miners that are in the US and don’t have the exposure to political unrest and instability of those that mine in Latin America and Africa etc

    I thought I would throw these out for discussion – DD etc: maybe Alex will have a look/see at the charts:

    MDRPF – Midas Gold (frankly I like the name 😉 they are in Idaho and I also like the “story”
    http://midasgoldidaho.com

    And the volume today is pretty impressive – https://uploads.disquscdn.com/images/4c2516f2e412134d81140c59ddb95d88c7ad251a489c7064c38308b6cf967b24.png

    • Cason
      Cason says:

      short opportunity? Maybe for 1-3 days but we are dropping into ICL lows which are a screaming BUY!! So, keep it on a short leash and get your dolla’ bills ready. Don’t short into the hole!

  22. Shermo
    Shermo says:

    I’m thinking we are going to get a daily, intermediate and yearly cycle low all in October
    Gdx to double from 22. Gdxj does more. Jnug may hit near 8 then go to 40. Gold to 1500 by March 2017

    Ktov still a buy. Holding long term when fda approves could hit 300+ million in sales in 4 years. Patent good until 2030. But big pharma will buy out long before then. We’ll see

      • alain
        alain says:

        well always with a close stop , but when looking at us$ , I get worried for gold ,unless they both go up at the same time ,witch is totally possible . we shall see !

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