FED WEDNESDAY JULY 26- Don’t Count Your…

Well, it doesn’t hurt to look for clues and be prepared, right?  We will do that today…

 

 

Starting with OIL

 

WTIC – Oil looked Bullish last week after the inventory report, closing over the 50sma for 2 days.  Then on Friday we saw it get slapped down.  I drew that trend line as a needed support.

WTIC –  Oil reversed on that trend line and looked bullish again.

WTIC –  Tuesday we saw Oil jump up over 3% , regaining that 50sma easily.  This chart is Bullish and in the weekend report I will mention just how bullish this could get.   For now I was a bit concerned about Oil/Energy stocks struggling at the 50sma too  ( CLE, OIH) .

 

XLE on JULY 6th.   This chart that I used with my special indicators was telling me that the lows were possibly being put in place, even as it dropped 2 sharp days in a row.  PATIENCE was recommended, because bottoming can take time, become choppy, and frustrating.   For example, to be safe, I wanted to see the XLE above the 50sma for starters.   Please see the chart.

 

XLE –  The next day the low was in place with an immediate breakdown & reversal.  Now we see the XLE is battling back above the 50sma, so Oil & Energy stocks could be bottoming.

Along with the companies that I have repeatedly mentioned  as seemingly bottoming ( RES, ERF, AREX, SPN, etc) I am now looking for other clues.  Other companies that will start shaping up and look as though they have bottomed.

 

PACD – A nice long base and a 9% pop on Tuesday, PACD is repeatedly bouncing off of the 50sma.  This may do quite well when it finally breaks free.  AT $1.50 , a run to $3 on this chart is a 100% move.

PQ – Above the 50sma after tagging it repeatedly, I like the chart set up.

 

SM –  I am now finding more Oil & Energy stocks acting correctly above that 50sma

SO I AM NOW GOING TO WATCH ENERGY CLOSELY.  IT IS IN A CHOPPY BOTTOMING PHASE, BUT THE LOWS COULD BE IN PLACE FOR MANY OF THESE.

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IN A RECENT REPORT, I MENTIONED THAT I THOUGHT THAT COMMODITIES HAD BOTTOMED AND MAY BE THE SAFER TRADE FOR MEDIUM TERM OR BUY & HOLD.

 

We are seeing some earnings being released now, and so far surprises have been to the upside. Very encouraging.  Let’s take a look…

 

AKS released earnings a day after everyone seemed to bail out on it.  AKS dropped hard on Monday, and then Tuesdays earnings pushed it right back up over the 50sma.  AKS was up 12.44% on Tuesday with big volume.  This should now continue to run higher out of this base.

 

 

FCX –  Earnings certainly didn’t hurt FCX, it was up 14.75% in addition to the recent run up from $11 to $13.

 

I recommended X in  June, but here On JULY 10  ‘X‘ was a safer buy after breaking above the 50sma,  falling back to back test it, and reversing higher.

X started moving higher and that round bottom base looks solid. What about earnings season?

 

X released earnings after the bell last night, and this chart shows the after hr move.  Up $2.15 and price would open at $26.59 Wednesday if this stays as is.  These are becoming buy & hold candidates if you prefer that style.  This could have been bought & held from May onward.

CLF –  What will CLF DO THURSDAY?

 

AMD –  I have recommended AMD for Months now.  I like the particular chart  set up on AMD & CY.  Here we see that AMD released earnings and was up $1.52 , ready to open at $15.63.

 

My June 21st chart helps you to see where $15.63 is in the big picture.  It is a break out to new recent  highs again.

 

 

So commodities are experiencing a bullish earnings period, guess what else happened?

 

This is a good sign,  NEM released earnings pre-market, and NEM is a big part of the GDX

ABX – You may recall that on Monday I said I was examining components of GDX –  GG and NEM looked good, but ABX was U-G-L-Y.

ABX quickly reversed that ugly down day yesterday, and this is usually a bullish occurrence.  SO the day before the FOMC meeting, we see NEM breaking out higher on earnings, ABX turns bullish, and GG is still above the 50sma.  That is encouraging.

 

My ABX big picture chart from last week.

 

SO now let’s briefly discuss the Miners.

 

GDX JULY 21 –  Many felt that GDX was acting  “too weak” to have seen an ICL recently, and I was trying to point out here that it was not too weak.  In a Monday report I  mentioned how many Miners actually bottomed in May so far  ( see GORO, RGLD, IAG, NGD, etc) .  With 9 of 10 days being higher, I did think  that the GDX could drop before the FOMC and then hopefully take off higher.

GDX –  It dropped the next day, right to the 10sma. I had been pointing out a bearish wedge, and would rather have that drop before the FOMC & get it out of the way,  not after.  Now what?  That trend line could be a target, but …

GDX – With NEM popping on Tuesday and ABX reversing higher too,  GDX respected that 10sma, yet remains under the 50sma so far.  Can this drop after the FOMC to the trend line? Yes.  Can GDX POP & RUN after the FOMC meeting?  Yes, we find ourselves right in the middle.  GDX  could run to day 20 if it wanted before dropping into a dcl, and this was day 11.

 

GDXJ – You cannot help but see that GDXJ actually bottomed in May.  Triangles mess up cycle counts and I have been pointing out repeatedly that GOLD bottomed in July, but MINERS are in a triangle that look to have bottomed in May.   The question is ,  ‘Is this the triangle for GDXJ?’  or…

Or … ‘Is this the triangle for GDXJ?’  The answer is,  It doesn’t matter  🙂  This is going to break one way or the other with this FOMC meeting, and I tend to think that like commodities, Miners are going higher.  Let’s look at Gold.

 

GOLD –  We have been viewing the BIG RUN from the 2016 lows as a 1-2-3-4-5 move to ‘1’.  Then an a-b-c possibly to ‘2’.  That would have us in the big kahuna ‘3’, and we have seen 1-2 of ‘3’.  So this would be  3 of 3 –  the biggest piece of the pie.   I seriously didn’t want to draw this at this point and get people overly bullish, because look at the move so far….CHOPPY & NOT EASY TO RIDE.  It does show , however,  that we could be looking at a huge move to $1500-1550 or so over time.  Let me simplify this…

 

GOLD – I envision a giant inverse H&S could form with a 1-2-3-4-5 run out of this base. We have seen a possible move to 1 & 2 and 3 started in December with that higher low.  Sideways chop causes fear and a hatred of Miners. We at Chartfreak are not that way at all, we look for clues along the way.  The C.O.T. has dropped, time-wise an ICL could be in place, and when this move continues – we will make a ton of excellent trades and money.  Miners should again be rising over 100%, 300%, etc.   Can you see that BASE from 2013 to now?  You have endured the worst part of this process,  the sideways chop ,chop, chop.   If this is 3 of 3, you will be riding the best part of this process, possibly for the rest of 2017.    If the FOMC causes a little more base action, a little more Chop, chop, drop?  Then I wanted you  to see this chart anyway, because I believe that it is still coming your way.

Summary –   As mentioned in prior reports,  going into todays Fed Mtg, I want to mention that I am seeing Miners acting much more like they have starting a run higher, and not like they are weak &  inside of a 4th or 5th daily cycle ready to roll over.  Time will tell.   The earnings Pop in NEM was encouraging.

 

PGLC-  Another Gold Miner breaking out & running.

 

RGLD from July 21

IAG WEEKLY –  $1 to $6, and still at $5.   DO you own this?   “GOT IAG?”

 

KGC – This was last week, but KGC remains well above that 30 ma on a wkly chart.  We see Dec lows, march lows, May lows, July lows.

  In Conclusion:  Obviously my Thursday report will discuss what we have seen after the FOMC meeting, but I believe that what is to be done for the Fed today  is already baked into the cake. There should be no surprises, so what you currently see could be what we get with Miners.   Like I said in yesterdays report, I am seeing Gold up day after day, with only 2 down days out of 11.  I have to ask myself…“Does that sound like a weak 5th daily cycle about to roll over?  Or does that seem more like an ICL has occurred?”.  I have DEFINITELY seen ICLs that slowly move higher & higher and do not just rip out higher and higher.    I mentioned a few days ago that it is best to buy something,  hold a few miners at least  ( Skin in the game), and use stops.

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~ALEX

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IDRA-  The Idra buy in yesterdays report was an ascending wedge ready to break out.

IDRA –  I was asked where should I sell?   Well, I dont think that your buy point will be broken, so sell when you want to lock in profits.  I expect it to move to the April highs at least, so that would be $1.90 to $2.60.  It could go a lot higher over time, if it forms a cup & handle here.

GORO –  Encouraging to see this pattern could be forming in GORO too.

After the Fed Meeting, some may want to buy it if it holds above the 50sma.

GORO BIG PICTURE – Goro actually may have broken above resistance recently. It can return to the 2016 highs over time, when Gold makes a solid run higher.