6-30 Weekend Report- Chartfreak Lions
I’m sorry, but my wife talked me into the picture above for the weekend report. I actually felt right at home on my visit to the Biltmore in Asheville North Carolina. Why? Well, they had Chartfreak Lions everywhere, and also Miners began breaking out Friday morning, easing any concerns that something ugly would happen in Gold while I was away. 🙂 Why did I like what I saw Friday, and what does that move in GDX & GDXJ mean ( if anything?). Let’s discuss the market action from this past week and what I m expecting as a result. I also want to mention why I chose the LION as my logo when I started Chartfreak…
The Lion as my logo: The Lion is known to be fierce, but its reputation is mainly one of courage. Even when faced with danger of more than one enemy at a time, it wants to move forward with courage, and attacks the danger with purpose, especially if protecting young. When I started Chartfreak, I really hoped that the reports of Chartfreak would help to instill just a little more courage when facing questionable or volatile market conditions, especially when witnessing a deep continuous sell off into an ICL.
Gold has been selling off day after day after day, and my hope is that the constant barrage of charts and info here has at least added a little more conviction & some Lion-like Courage to act and move forward in such a situation. We are at a time when courage may be needed, the time to Buy Miners despite a constant sell off into of Gold an ICL.
And now to the markets…
,
NASDAQ WEEKLY – The NASDAQ closed above the 10 ma on a weekly basis, and that is good for now, but I am expecting an eventual ICL drop in the General Markets, it is very overbought, and I do not think that the downside is completely finished. Here is why..
SPX DAILY – The SPX DAILY was rejected at the 10sma after rallying higher Friday. Currently we are due for a daily cycle low & a new daily cycle and this is an unconfirmed swing, so we may have the dcl in place. It may occur as L.T. and then roll down into an ICL. So if we DO get a dcl & a bounce here ( or if this is it already starting & struggling at the 10sma) The weekly chart shows that that drop could get rather ugly…
SPX WEEKLY – The short term analysis for the SPX WEEKLY is simply that it is good to see this reversal candle, and a daily cycle is due, so it could move higher. That said however, for the longer term, this is very overbought, volume has picked up on weekly selling at the recent top , and could indicate smart money selling out at the top (distribution), and further downside for an ICL in due time. We’ll Go ONE STEP AT A TIME, so for now we could get a bounce with a dcl.
DJIA DAILY – Look at the last daily cycle for DJIA. It was weak compared to Tech and has closd under the 200sma for 3 or 4 days for the first time in 2 years! That might be a bad sign. IF WE HAVE ANOTHER DAILY CYCLE HERE and then a drop into an ICL, where would that take the DJIA? Probably deep. So I’ll keep my eyes on the General Markets for more clues going forward.
DJIA WEEKLY – The last daily cycle was much weaker than Nasdaq, so the next daily cycle could break down even lower. LOOK AT THE WEEKLY MACD. VERY BAD IF YOU ASK ME. I am getting cautious, but it is a bull as long as it remains in an uptrend. That WEEKLY MACD is screaming at me that the DOW is not doing well.
WTIC WEEKLY – Oil is still surging higher, but I do see some weakness in the form of a divergence in the MACD, and …
XLE WEEKLY – The XLE is bullish, but not running to new highs with Oil. It makes me feel that Oil will pull back or go sideways, and that may allow XLE to catch up.
.
USD DAILY- Read the chart, this is good news for Gold. The USD is in the timing for its own ICL drop and could easily drop to the 200sma as a failed daily cycle. The MACD shows weakness on the highs.
I have been showing this bigger picture chart too. The USD now looks ready to drop down from resistance.
The current USD WEEKLY shows that resistance has capped the progress and it is overbought. This is also good for a solid rally out of an ICL (low) for GOLD.
.
PRECIOUS METALS
.
NOTE: In the comments section I mentioned that I added to my leverage & Miners early Friday Morning, even though we do not have a confirmed swing low. This is not the safest way to trade it, but I liked what I was seeing in the GDX/GDXJ & Components of those ETFs. I also liked the drop in the USD at resistance, so things seem to be lining up as expected. Any drop in Gold should be rather short lived due to cycle timing, if we get some more downside. We may also have seen the ICL. Let’s take a look.
.
GOLD WEEKLY – After basically 10 days of selling, we had a reversal in GOLD on Friday as the USD rolled over. It is NOT above the 10sma, so it is a swing low ‘unconfirmed’, but the trend line has been broken! Day 28 IS in the timing for a swing low DCL ( or in this case, ICL). We need follow through next week to confirm a swing low dcl/ ICL.
SILVER WEEKLY – Silver is at the bottom of a trading range. his is a 2-3 year consolidation friends, and this could really run swiftly higher when it breaks out. Please own some Silver stocks if you do not own any yet. I have been pushing them since April, and they have not been selling off.
ABX– On Friday morning, I noticed GDX & GDXJ pushing higher, so I decided to look up some of the Miner components. ABX was looking quite bullish, and at this point, Gold was not even really moving higher yet. It looked like MINERS might be leading the move higher. This was a Friday morning chart and ABX then closed with over 13 million in volume.
GG – You can see that GG also broke higher, taking back 7 days of trading, and this also occurred before Gold really made a move Friday morning, so Miners may be leading the way. This is why I added to my positions. The timing I right and the Miners were Bullish before Gold kicked in.
ABX, GG, & NEM are very oversold, and yet GG & ABX have only been going sideways as Gold sells off. This is a sign of strength and when Gold runs higher, you have to believe that these will do very well, pulling GDX up with them. Let’s look at GDX & GDXJ now…
.
GDX DAILY – GDX broke above the 10sma and had a strong day, especially when Gold did not seem to do very much. The volume was very nice.
GDX WEEKLY – This has been a tight pattern and looks ready to break out.
GDXJ DAILY – GDXJ also broke higher, closing above the 10 sma also.
BIGGER PICTURE
.
HUI MONTHLY WITH BOLLINGER BANDS – This is the HUI Monthly chart. I love the tightness of the Bollinger bands, which usually leads to a break out & sustained run. The B.B. was has not been as pinched as this since maybe the 2001 lows.
GDX MONTHLY WITH BOLLINGER BANDS – Using a Monthly chart, GDX has formed an extremely tight price consolidation & Very Tight B.B. Pinch. These do not just last forever, they break & run for a while, having built up good energy to move on out. I think the move will be higher, and could dwarf the 2016 run.
AG DAILY – The Silver Miner AG has been running bullishly for weeks & months now, and it started breaking higher again Friday, yet some are still ridiculing the Miners. You can’t say that I haven’t tried to convince everyone that these Miners are going to be good money makers.
TRX DAILY – I bought TRX as it popped from a down trend this morning. This ALMOST tripled from the Dec lows into May. That would be almost 200% in 5 months. It has now pulled back nicely with Golds sell off and I see a bullish wedge possibly forming. I like the MACD set up and it is quite oversold, PLUS we are due for a Gold ICL.
.
CONCLUSION:
.
We have been watching and anticipating a Deep Tradable Low (an ICL) for weeks & even Months. We have taken on some trades in Silver Miners and maybe a couple of Gold Miners too, but we also have been patiently waiting to enter at or near the right time- at THE LOWS of an ICL. I recommended Silver Miners, and have pointed out along the way some Bullish Miners like KL, RGLD, GORO , and others that are moving well off their lows as GOLD continued to sell down to almost reach the Dec lows. It has become OBVIOUSLY TO ME- Several MINERS are acting very Bullishly as Gold crashed down, and there is nothing more that I can say here. Some do not believe it, and they will have to be left behind. Look at GORO. Gold crashed down for weeks now, and this is not a bearish drop in Miners. Enough said…
We will get a confirmed Swing Low in Gold soon, likely next week, and Gold will make a nice run higher. THIS CHART SHOWS GOLD AT PRIOR ICLs. They crash down, they rally even harder in Bull markets, to new highs. Personally, I have not seen Miners lead the way like some are now, in a long time. Because of that, I feel that we should expect an exceptional run in Miners. Time will tell. After a sell off like we have seen, it may take a little courage to go long, but you will not regret it when the rally phase takes hold.
.
Enjoy the rest of your weekend and be sure to rest up, because next week it may be time to start stalking some more Miners
,
