October 13- Still On The Hunt

When hunting for good set ups, just keep in mind that every day that passes brings us closer to the target.

I can pretty much say that nothing really changed with the release of the Fed Minutes. You could just read Wednesday mornings report and add another day, and that pretty much sums it up. There is good news. IF a daily cycle in Gold is going to last an estimated 22-33 days, and we are on day 28?  We are seriously almost there ( or we are there and just need confirmation). 

SPX –  No change from this chart yesterday. There is more room to drop.

USD – The USD looks strong and actually has been strong breaking to new recent highs, but it is due for a drop into a DCL.

Note: Even with the last 3 days of solid gains, Gold & Miners stopped selling off.

USD #2– We have seen the dollar run up & break to new highs, and yet still roll over in 2015 as shown here with the blue line.

USD WKLY– I used this weekly chart to show again that the big picture is lower highs and lower lows at this point.

WTIC – I thought that Oil would pause around the $50 area.

.

GOLD & MINERS

.

GOLD MAY OR MAY NOT BE AT  T-H-E LOWS , but repeat after me…

…Time is slowly running out. These daily cycles do not stretch onward forever.

.

GOLD – So the dance continues, but time is running out. We are on Day 28 of Septembers daily cycle, or day 3 of a new one if the lows hold. This would be a safer conclusion with a close above the 10sma.

This possible path from Yesterdays report is still valid, a shake out drop & then reversal. On day 28, any drop would be limited and recovered.

GDX– Wednesday saw the Miners move higher and they did not put in a lower low, so they now have  a swing in place.  Will it hold? Lets look a bit deeper…

.

Miners started to take the lead, and this is at times a buy signal.  When the GDX:GOLD line crosses the 8 sma, it can be taken as a low risk trade ( Green arrows) .  A break of a trend line is what I have used in harmony with other signals to catch a low, but it is also riskier in volatile bottoms. We did break the short trend today, maybe the 8 tomorrow if Miners outperform Gold.

.

For those that may be new here, I developed some of my own indicators over time that I would personally use for finding a low ( usually an ICL, I’ve also used it on dcls). I dont always present it here, because you can get another day or two down  ( It actually triggers on the way down on rare occasion)  and some people cannot take the additional dip without stopping out and becoming frustrated.  That said, I was watching this lower indicator all morning, and this was it around Noon Time.

.

GDX  Buy signal – mid day, almost there. This was before the minutes were released, it looked ready to cross.

This is the same indicator at the end of the day.  It crossed right when the minutes were released.

This indicator triggers at the low usually, and even as price is dropping.  Notice that when it triggers, it often does so BEFORE the big price pop or gap open above the 10sma. It will be interesting if GDX gaps open tomorrow.

.

So again, we are looking very good when it comes to being near a low.  If it is an ICL, we will spend time moving higher for months, right into the year end.  If it is just a final dcl, it would likely be Left Translated and roll over after 8-12 days  ( very frustrating).  I am leaning strongly toward an ICL at this point.

.

Lets see if some Miners are showing progress near these lows or are they looking weak?

.

BULLISH :

EGO – This Miners has actually put in a higher low and attempted to break above the 9 sma today.

KGC – We see positive divergence at the lows and KGC also tried to break above the 10sma

HL –  I like the fact that HL has not dropped all that much in this recent sell off.

CDE –  This is holding up well too.

AKG –  This has held up nicely in the recent sell off. It may be a shake out from the 4+ month consolidation.

.

SO we are very close to the lows now, if we are not there already. Our cycle timing is telling us that this will end very soon. Basically each day is a day closer to the lows or a rally out of the lows.  Wednesdays  reaction to the release of the Fed Minutes was positive, especially when you consider that  the dollar continues to rally, and Gold & miners do not continue to sell off.  It feels more like they are under accumulation. A close above the 10sma on GDX is further confirmation that the lows are behind us, I have been buying and I recommend that you have at least a partial position and add later when further confirmation is reported, unless you absolutely cannot stand to watch your positions drop at all. 

.

I have pretty much been reporting the same thing from the weekend report and also all week long. It is like the Theme picture, when the lion stalks his prey, but he cannot pounce on it until it gets close enough and the timing is right. We continue to hunt for confirmation that the lows are in place, and we are close.  We hunt for lower risk set ups. I personally believe that anything that you buy in this area now will be green and profitable in a week or two. It is just the possibility of a flash drop & recovery that keep some safely in cash and on the sidelines.  I understand that. A GDX close over the 10sma is considered a buy for you.

.

~ALEX

.
The reports this week have been a bit extensive so if nothing major changes on Thursday, I will have a Friday report, but expect it to be much shorter. You could go back and read the weekend report at this point and see that this has been an ongoing process that gradually unfolds over time.

,

GDX – Another view.  This is an example of a 2 day drop after it looked like a low might be in place.  This could happen now, so I wanted a visual for you. Some would be stopped out at the worst time if they buy here with a tight stop. If that 2 day drop happened Thursday & Friday, no one would buy it heading into the weekend. This chart shows points that looked like the lows, and then a 2 day drop to fresh lows.  Then we got the rally.

Finally –  Are you still holding this trade? Congratulations, because this went sideways for a month, but patience is paying off.

Maybe actually have written to ask where will I sell?  I have been holding this since the 30’s and 40 cents area and  may not sell mine at all.  Maybe I will sell half if conditions change, but I like the long term forecast too, so I will just monitor the company going forward. If you are in it simply for a trade,  I do think that the next resistance area is the 200sma or maybe around $1 and it is getting overbought.  You can sell a partial position there or just close the trade and take the money and run.  Congrats!

WHY I LIKE IT LONG TERM TOO

.

AMRS WKLY BREAK OUT –  I will sell if I thought that we will get a back test, but for now I want to see how far this can run and it will take time.