Out Of The Woods?

The markets had a bit of a drop yesterday, and some recovered and even closed green by the end of the day. Are we out of the woods now, with only upside ahead again?  Let’s take a look at some charts…

TNA – We are late in the timing for a dcl, and I could paint a case for the TNA, RUT, IWM, etc as having pulled back enough for a dcl.  It broke a trend line, and closed under the 10sma to satisfy the requirements. A Follow through upside and a break out above the Magenta line would be bullish. What a beautiful run higher the small caps have had.

NASDAQ –  The NASDAQ broke below the 10sma and did not recover (yet). Watch the NASDAQ today and see if it can recover, but in the past ( purple arrows), it struggled for a bit under the 10sma.

DOW JONES –  The DOW only dropped a little bit, stayed well above the 10sma, and recovered.  This looks bullish  ( and it night be), but if this gaps down, this would leave an island top.

So whether or not we are out of the woods when it comes to a sell off is not clear. I would have expected a deeper drop, but as mentioned before, if a parabolic stage is starting, the dips will be, and have been , much less evident.   THis makes the markets Right Translated in any case, so they should continue higher after a dip if there is more to go.

WTIC – Oil dropped to $51.51, and that is not unexpected. Yellow arrow, Blue arrow shows that this is how oil often moves out of lows. The 50 & 200sma should be solid support.

 This is an area that I am invested in and needs a bit of attention.  UGAZ, BOIL, UNG,  did NOT break the recent lows after dipping down there, it rallied strongly, putting in a solid Bullish looking reversal. If THAT inventory report didn’t break it down, it seems like clear skies ahead.  Are we out of the woods here?

UGAZ from yesterdays report. My stop was below the magenta line, and I said that I was willing to take a loss under $9.50ish if I get stopped out.

UGAZ –  I was pennies from being stopped out as UGAZ hit $9.54 & rallied strongly.  I had been outside helping someone cleaning my chimney in the morning, so I pretty much missed the whole show.  I figured that my stop would take me out.  That was amazing, however…

NATGAS-  It looks like NATGAS itself did take out the lows from 2 weeks ago.  This is usually bearish and could signal a failed daily cycle, so I am cautious , but NATGAS put in a strong reversal too.  It did not take out August lows, so I am going to watch this going forward  ( Stockcharts NATGAS chart is still inaccurate).

GOLD –  I must admit that this does look Bullish, after filling a gap and reversing.  This is day 9, with a day 6 peak… I do not expect a rally here.

GDX –  GDX does NOT look as good as Gold, it was rejected near the 10sma and could be forming a small bear flag here.  A day 9 peak so far would make this likely a left translated daily cycle & the drop is still ahead in my opinion.

NOTE :  EARNINGS ARE BEING RELEASED.   AUY & MUX both reported this week, and it is encouraging to see that they did NOT get slammed down after earning,  though Gold was selling off.  That is a short term bullish scenario.  KLDX reported last night, we’ll see what it does today.

AUY -This chart does look good, but I am not buying Miners.

So today is Friday, enjoy the last trading day of the week and I will cover more of the Big Picture in the weekend report.

~ALEX

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I have given us plenty of trades to watch this week and last.  Yesterday , for example, I pointed out  EAT, TACO, I have pointed out STEEL STOCKS and Shippers, BBG remains bullish, PXLW dropped to the 10sma and reversed higher, etc. We have plenty of trades in front of us.  Let’s review just a few…

CLF –    With yesterdays sell off, many Steel stocks still had trouble filling the gap, and then reversed strongly higher after attempting to do so.  Price was dropping, the MACD is rising.

AKS –   I want to point out that there is still nothing wrong with the Steel trades that I mentioned, we just need to be patient.  Taking a trade does not mean that it will just run higher from there day after day and if it doesn’t we should bail out on day 2.

AKS does not look weak enough to fill the gap, it looks bullish.

STLD –  This was a huge reversal and adds to the steel sector looking bullish.

IBIO–  I posted this in the comments yesterday before the close.  I am in this and it is stuck in between the 200 & 50sma. I think that if it breaks out it can really run nicely, and it is showing signs of bullishness so far.

MBOT – MBOT seems to be holding up on this trend line. The longer term chart looks great.

HTGM  –  HTGM  could have more downside since it never back tested the 50sma.  I am still holding this …

HTGM Long term – I really like this base and the upside potential over time could be very profitable.

YESTERDAY DURING THE FIRST HOUR OF TRADING – I posted this in the comments section before stepping outside.  I said that I was watching bullish activity in GNMX and was adding to my position at $1.32  (And again at $1.35).

GNMX #1 –  THis is a bullish set up,  one of those explosive ones, so I posted that this was a buy.

GNMX #2 –  It Popped while I was outside, so I looked at it on a smaller time frame, and  also captured this intraday chart and posted that a possible Bull flag was forming  ( More upside).  This is how I often watch a trade intraday .  It was now at $1.42 and it had hit the $1.47 area on that Pop. This was acting as expected.

GNMX #3 –  And then it popped to $1.90 and sold off into the close. $1.32 to $1.61 is still good, but I usually sell a 25% or 33 % chuck when they pop like this.  I was too busy and I am still holding my entire purchase.  I need to see what this does on Friday, but often they consolidate if they get a bit ahead of themselves.

SB – I  mentioned Shippers as bullish,  and not just short term, they are actually trending higher . I expect SB to attempt to break to new highs, so this would still be a buy.

APRI – Tammy mentioned this , so I looked at the chart.  This is a really steady, reliable climb ( so far), up 100% from the June lows.   It looks like a bullish flag / consolidation & should run higher soon. It may drop down and tag the 200sma first.    Thx Tammie.

REMINDER:  PLEASE TRY TO REMEMBER THAT WEAK EARNINGS CAN ADVERSELY AFFECT ANY STOCK –  SO TRY TO LOOK AT THE NEWS PERTAINING TO THE STOCKS THAT YOU OWN, AND BEWARE IF YOU SEE THAT THEIR EARNINGS ARE COMING UP.