Thursday January 26th

SPX JAN 24th –  Tuesday, we were expecting an upside break out, and we also viewed the DOW with a tight bollinger Band squeeze.

SPX –  Break out

NOTE : The VIX hit a low 10.51 Wednesday.  That is a 2 year low and usually indicates that a top is near, but we have a strong break out after a consolidation at the same time.  With this set up, I mentioned in yesterdays report  that I expected a break out and I would then use a trailing stop or visual stop to lock in gains as it moves higher.

USD – The dollar made a new low Wednesday. With a peak on day 16 and a low on day 32, this daily cycle is weak.

Stocks like  WG, TPLM, HK, EMES, and other broke out higher.

WG WEEKLY –  This really shows great potential in the long run.  We have some long term investors here, and this has moved from $1 to $4.  After such a consolidation / base the upside is great.

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GOLD – On day 26th we finally broke below that 10sma. We are due for a dip into a dcl, and we have been prepared for this possibility the whole time. WATCH THE 1175 AREA.

SILVER resisted the sell off into the close.

GDX tagged the 10 sma and bounced . Miners did not completely follow Golds selling.

I really liked this set up, so I mentioned it in the comments section and then put it in Wednesdays report ( Clipped and shown below) . Notice that it broke above that 50sma and coiled along that 50sma for weeks. I expected a break higher soon and I said  ” I have started accumulating it”.

And Boom, right to the 200sma, but I dont think that it is going to stop there. This is huge volume and there was no news on this. SOMEONE KNOWS SOMETHING in my opinion.

The base on THM is huge, and it is trying to break free.

EXK didnt sell off on Wednesday, it recovered.

I noticed something interesting when I was staring at the GDXJ chart.  I was looking at it and thinking to myself,  ” I have seen this before”.

This is GDXJ now, notice how much it resembles the chart of Gold coming out of the lows that follows.

GOLD had a similar pattern that GDXJ now has.  It dropped into an ICL in MAY 2016 and broke the trend line and recovered.  I guess that we could see GDXJ break the trend line into a dcl now that the dcl is due.  It then would recover,  BUT IT DOES NOT HAVE TO BREAK DOWN.  I am just showing the similarity that I found in the 2 patterns.  Do not let a possible dip scare you away.

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Trades and reminders

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WRN – A copper stock.  See TGB.

NAK broke down and recovered intraday again.

IPI – This was a nice break out, and what about the big picture?

IPI WKLY –  I would buy & hold this.

EDXC has been acting correctly for a while and was featured in past reports. After my December report “High Risk”, which discussed the medical marijuana industry and the potential there, EDXC was again revisited as forming a cup.

EDXC – After the cup & handle broke out, it has now formed another handle. This will likely just continue to stair-step higher.  It has more than doubled since my report in December. And the Bigger Picture?

My January 12 long term chart

SO I like what I am seeing here, even with Gold pulling back into a possible dcl. Miners are holding up well, and some are still doing their own bullish move.  ( THM, EGI, EXK, PLG, etc, etc).  In fact , some silver stocks are just climbing higher on their own.

Look at a 1 month chart of PAAS – Not scary at all.

NAK is still acting like NAK , and I still really like what I see in PLG, WRN, etc .  By the way,  TRQ is breaking out on a weekly chart and looks very good too. Thursday will tell us a little bit more of the Gold Daily Cycle low story, and for now I continue to hold the Miners that I have accumulated, have some cash to buy a dip on a dcl,  and trade set ups continue to present themselves.  Enjoy your Thursday trading!

~ALEX