May 9th – Close One

We had a lot of movement in the markets on Tuesday, but we did not get the move that we were looking for.  What was that?…

SPX – We did not get a clear break out to add a bullish feel to the SPX or DJIA. The triangle formation is pinching into the apex. This should break sooner than later, and I would expect it to break upside. I will explain…

NASDAQ – The NASDAQ did break out Monday and closed above the 50sma Monday & Tuesday. Tech appears stronger again, and the MACD has crossed upward and is moving higher. Some of the charts from yesterdays report actually did very well, despite the fact that the markets were a bit choppy. That is why I would expect an upside break for the General Markets.  I will have additional charts at the end of the report.

This is just one example of one of the chart set ups from yesterdays report following through upside. Several look Bullish.

OIL  – Oil sold off early on Tuesday, but surged higher and recovered into the close and even into after hours. $72 to $74 is a measured move that I have pointed out, we’ll see if it can get there. Wednesday is oil inventory reports ,  and we usually have a reaction with that.

XLE  – The XLE consolidation got a little tricky this week. Notice that on Monday,  it shot higher as a break out and then sold off ( reversal lower). Tuesday it shot down, reversed, and closed higher ( reversal higher).  I would expect it to follow Oil higher.

GOLD #1  – Gold sold off in the morning, and it threatened to break the recent lows, but it did not. We are still at the lows on what looks to be day 5 of a new daily cycle.   We want this to push higher soon and I really want to see it  break above the 50sma.

GOLD #2 –  The longer that Gold lingers here, I have the concern that this daily cycle remains stagnant and eventually rolls over as Left Translated, down into an ICL.   It could be simply forming a bear flag if it doesn’t break higher.   So I keep this in the back of my mind, but I dont let a day like Tuesday shake me out- no boundaries were violated.  Also a quick drop & recovery of 1302 may extend the daily cycle to day 35, since a confirmed daily cycle did not occur in Gold.

SILVER – We also want Silver to break out higher, and not just give us a weak tag of the 200sma and then roll over either.

GDX – GDX dropped and threatened to break down Tuesday, but after the Iran deal Announcement, it recovered with a reversal too.  As long as there is time, there is hope for a push higher, but…

But that is the point, time will eventually run out. Hopefully Tuesdays reversal will be the start of a push higher through resistance.  If not, you can see the importance of keeping stops in place.  Another dip like Tuesdays that does break the lows is considered a ‘failure’. For now, Miners are safe.

I really wish that Miners rocketed out of the DCL  with day 5 GDX at $24, but here on day 5 price dropped down & actually tagged the high of the candle of the Daily Cycle Low from a week ago.  A week of sideways action is all we have had so far.

The good news is that some Miners are still out performing and even becoming more bullish.  I mentioned the BPGDM in the weekend report as a bullish sign of that.  Also some Miners like  IAG for example, Popped after earnings and remain bullish.

KL is still making new highs after a break out and back testing the 50sma. So several Miners remain very healthy despitre the sideways chop of GDX/GDXJ.

 Hopefully we will get that follow through higher in the coming days of this week.  Time will tell, enjoy your Wednesday trading!

~ALEX

CAMT was at the highs and looked ready to break out yesterday.

CAMT – Break out. It may bull flag or stall and could still be bought rather low risk  if it did.

COUP – As a cup, I thought that this might put in a handle after the break out reversed lower.  Yesterday…

COUP – Coup broke higher again, but this time it held.  Nice little move here. It may keep extending, or it could back test, it could be put on a watch list and bought if it does a back test, or just add if you own it or want to own it.  This looks like a mid point type of consolidation with a target of $62 if the Markets remain healthy.  I DO THINK THAT COUP COULD DROP & BACK TEST FIRST, the MACD is lagging.

LUNA  _ Luna followed through a little bit. This is set up as forming a cup similar to what COUP did.  It could still be bought here in my opinion,  BUT EARNINGS COME OUT TONIGHT.  WATCH LIST?

SQ –  This also continued higher and is acting bullishly. It should form a cup

RESTAURANT – These continue to do very well, and one more that I have been waiting for is setting up now. I will mention it here…

CHUY – I posted this as ready to break out April 26th

CHUY-  Break out and Bull flag, break again and another bull flag stall? Buy at the 10sma

CAKE –  Are you sick of hearing about CAKE yet? It broke out and has back tested …

CAKE – And it moved higher yesterday too.  As mentioned, the Restaurant sector has ignored the markets recent choppiness.

See also SHAK, TXRH ( has not broken out yet), CHUY, WING, etc as others mentioned, but also I want to include DRI now.

DRI –  I think that this one may be ready to go. They own Olive Garden, LongHorn Steakhouse, Fine Dining, Seasons 52 and Bahama Breeze restaurants and more. What I was watching & waiting for on this was a drop (Back test)  to the 50sma, but it has formed a flag so I thought that I would post it now. I think a break out above the flag could be bought too. That drop on March 22 was an ‘earnings report’ miss, so earnings should not be due until June. It has recovered since then, and was even upgraded to outperform  on April  2 at the lows.

They did increased their full year fiscal outlook, but I wouldn’t hold it through June earnings. It may just be a good trade if it breaks higher.