Wednesday December 28th – 20,000

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 All eyes on Dow 20,000. It was close, but we didn’t quite get there yet.

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DJIA – I’m expecting a drop into a dcl, but the question remains, “Will we see Dow 20,000 before 2017?” It is possible, but then I think the markets experience that pull back..  Dow 19980.24 was the high Tuesday.

We do have a right translated daily cycle, so I would expect Dow 20,000 sooner or later.

USD– I am expected a dip into a dcl for the USD too, but this is a sideways consolidation so far. Recently, the dips have only been to the 50sma after such a sideways move. As this dip to the 50sma occurs, the bounce to the 50sma for GDX has also occurred. The USD is due for a dip into an ICL too, which should be deeper than the 50sma, and we have been looking for this to become a left translated  ( LT) Daily Cycle. We see a peak on day 8, and I’d rather not see a new high here on day 13.  I’m Watching 103.62.

WTIC – The WTIC is hanging at the highs.  I have said that I would like to see a new high before dipping into a dcl, to ensure a r.t. daily cycle ( Right translated bullishness) and this could just consolidate sideways and move higher before dipping into a dcl.  So far, Oil has broken out and holds on to that break out.

Let’s take a look at a couple of the energy stocks previously covered here.  As you will see, they are still acting like bullish set ups, but have been consolidating and not running higher.  They may be waiting on Oil.

NOG – It may drift to the 50sma if Oil dips down. It has been holding up nicely after a strong run from near $1.50 to $$3.50.

NADL – This just tagged the 50sma and put in a reversal. This could be considered a low risk buy here, with a stop a bit below the 50sma.

PACD – PACD has been drifting lower daily and it also may be back testing a break out from the base and the 50sma. It looks healthy, but I sold it and I ended up selling at a small loss, simply because I do not like to hold more than 5-10 stocks at a time, and I bought a few other areas.  I will explain later.

SO the set ups in many energy stocks mentioned in prior reports do remain bullish set ups, they just haven’t been running higher  (  NADL, NOG, AXAS, AREX, WPX, OAS, PACD, ETC).

GOLD & MINERS

GOLD & SILVER– Believe it or not, we had a nice push at the open of the precious metals markets this week, but Gold and Silver still didn’t close above the 10sma. Yes, I can believe it too  🙂   If the USD finally rolls over, expect Gold to move higher.

GDX – GDX may be leading the way, breaking above and closing above the 50sma. This is an acceptable buy signal at this point for Miners, if someone is waiting to enter the Miners.  It was not extremely convincing that this will push a lot higher yet.  Let’s see what happens if & when Gold finally moves higher.

Let’s look at just a couple of Miners that moved higher and see how they look. I have already mentioned GPL and DRD as  good looking at this point.   GPL continued higher, as for DRD…

DRD hit the 200sma and turned lower. It may bounce between the 50sma and the 200sma, and then break out higher . I bought DRD last week and might add if it holds a the 50sma and this sector looks set to move higher.  My stop would be a bit below the 50sma.

ASM – We did see other Miners pop up off of their lows / bases. This could at least run to the 200 sma for starters, similar to the Oct / Nov pop.

PPP – PPP has been a weak lagger for a long time, but now it seems to have put a double bottom in place and is moving higher from here. It is a low risk trade, but I haven’t like the past performance even during the bull run, so I am not taking this trade. That said, if PPP has finally found its lows, this could run nicely right to the 200sma ( a double).

So at this point, I would have to call this improvement in the precious metals sector.  It is the start of what have been looking for – the possible start of a nice move higher.  At the same time, I also have to call it rather unimpressive or not very convincing at this point, but that is how these stocks can act at the lows too.  What we are seeing is possible low risk trade set ups ( Stops under recent lows) and we could expect a bounce at least.  What we are hoping for is an ICL and a YCL ( Yearly Cycle Low).  The move from yearly cycle lows can be very profitable %-wise. If we get some follow through today, we can start looking for more bullish set ups in this sector. Enjoy your Wednesday trading  ( knowing that it  is a holiday shortened week and may even slow down further as the week moves forward).

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~ALEX

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It may be a holiday week, and light volume has been expected, but isn’t it great how volume still pours in when needed at the time of a critical break out on a bullish set up?

This was NAK Tuesday at 2:40 Eastern time.

Volume on this break out was great. It may be at a temporary peak, as shown, if it doesn’t suddenly blow off into a parabolic type peak. It has been acting very predictable.  Buy the dips at the 13 sma has worked out well recently, as it has formed a channel that is now trending higher.

WRN –  I have been pointing this out as a stock that is set up bullishly with great potential. I started buying around $1  ( Above & below at this time 2 weeks ago).  Over time, this could make it up to the former highs of $4.50 or more

WRN – This reversal was a good buy point as a cup & handle, very similar to last spring, so I mentioned that it could go sideways for a bit.  It did go sideways, and I posted a few more charts daily.

WRN – That sideways move built up the energy needed to break out and the volume was perfect ( on a light volume holiday week of trading) . It popped up 32% yesterday.  I sold 1/4 of my shares, because I often take some money on these pops , before they can take it back.  I also always let some ride, in case it just gets crazy.  So if I had 10,000 shares, I’d sell 2,500.  If I had 6000 shares, I would sell 2000, etc.   That is just my trading style.

I’m watching some bullish set ups in Fertilizer areas. POT and IPI weekly charts are bullish, and look set up to be so for the longer term traders.   If a sector remains bullish, these bases can push price back to former highs over time, as we saw last spring in the MINERS.

Example in Miners from my charts in our spring reports, in case you were not with us then. I pointed this out in NEM, ABX, and others.