SEPTEMBER 6TH – Mixed Again
I have been expecting a pull back in the General Markets, but notice what happened on Wednesday…
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NASDAQ – That had a pretty good size drop and the volume increased. Also look at 3 month daily charts of TWTR, FB, GOOG, ( Even AMZN yesterday) , SQ, etc. They are dropping from the highs, so …
It looks like the pull back has started, however,
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DJIA – The DOW closed higher with increasing volume. Interesting, and …
I’m not proof reading this a.m., please excuse typos if there are any, thanks!
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SPX – The SPX dropped all day again and closed back up as a reversal, only down 12 points. The volume picked up & the MACD is nearing a cross under, so at this point, We definitely still have mixed markets. The stochastics has a lot of downside space too.
IWM – The RUT, IWM, or even TNA seem to have done a back test of that recent break out so far. MIXED MARKETS.
WTIC LAST WEEK – I expected a possible H&S to form…
WTIC – Last week I mentioned that I was expecting Oil to roll over and begin an drop into an ICL, so we could get a H&S. I do see a possible H&S here now , but this is early in the daily cycle, so it is hard to know if this is just a 1/2 cycle dip or the start of a sell off. It did lose the 10sma & 50sma.
** For Oil I will Watch for a break of this lower trend line for follow through down. When this sells off, DWT or DRIP may be a good trade again ( if you are sick of waiting for miners).
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MORE MIXED MARKETS HERE, as the disconnect continues
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THIS IS QUITE FRUSTRATING, I KNOW. AS EXPECTED, THE USD Does seem to be topping, and it dropped and Gold Popped on Wednesday. EXACTLY what we wanted, EXACTLY WHAT WE EXPECTED RECENTLY…
GOLD – That back test held up , so far. The USD dropped, Gold Popped, and this would be day 13, so GOLD actually looks good as an ICL, however….
SILVER – Silvers didn’t pop very much. The new lows from Tuesday remained in tact, but…
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GOLD WAS UP, MINERS WERE DOWN AT THE OPEN ON WEDNESDAY
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MINERS SOLD DOWN AGAIN – Yes, GOLD popped, the USD dropped, and MINERS could not gain traction again. Everyone wants to know , “WHAT IS GOING ON HERE?” “ARE MINERS DEAD FOR GOOD?” It was a bit frustrating. They seem to be running their own separate course for right now. I think GDX & GDXJ need to finish off this final daily cycle, which could be a short one ( mentioned in yesterdays report) , and Miners could be doing a quick shake out. Therefore, Miners may ICL 2 weeks after Golds ICL.
Not all miners looked weak, but the GDX & GDXJ ETFs did. Lets take a look at this sector.
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GDXJ– Selling does look to be drying up based on volume . I see strong divergence. In my opinion, this is a very bullish looking chart, but I know that many here hate it. I get that, I understand that. Selling is drying up at this point though. We need buyers & short cover. 
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GDXJ – This is a close up of the divergence at these lows.
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I am hearing ‘talk’ on Twitter and in other blogs of Miners never recovering. Miners are not of any value now’, I am even hearing that all miners are just going to go bankrupt, even if Gold goes higher. I do not think that the recent price drop justifies that kind of talk, but These are things that I always here when sentiment is at a low. I have heard that before, honestly. Doubt & Fear take control and seem to be the way to rationalize this sell down. Remember: The GDX JAN ICL in 2016 by Miners took place 1 month after the lows of GOLD ( Dec ICL) then too. That was a much different time than what we have here, it was even worse, but Miners recovered in a big way after those lows. It was a more bearish time back then – do you recall that all you heard then was that GOLD HAD TO RETEST $1000 Or even $800. GDX would go to $6 or $8. I DO REMEMBER reading many articles saying that. People hated miners. I remember in my comments section people saying ‘so & so calls for GOLD $800!’ Doubt, fear and people giving up on Miners was a very real feeling day after day back then too. And then shortly after that, Miners took off upside and never looked back, everyone was happy making money in a Bull Run of miners.
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“All Miners are just going to go bankrupt, even if Gold rises?“ – Let’s look at a few Miners.
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HMY – I have pointed this one out for a while now, it is Bullish. The RSI is near 60, they don’t look bankrupt. Looks like a leader.
SBGL – Ditto , The RSI is above 60. Looks like a leader.
AAU – This is starting to resist selling and volume was very high today as it approaches the 50sma. The RSI is near 50 and the MACD has crossed. Could be starting to lead.
MUX – Flattening out, the MACD is showing good momentum. These and other stocks could be the reason why GDXJ is holding up better than GDX. The Juniors may be firming up first.
No, I don’t believe that ‘Miners are all going bankrupt and that they will not be valuable , even if Gold goes higher‘. Unfortunately, I do think that they are bottoming later than Gold, and that happened in 2016 too. That was not predictable, but when I look at GOLD, that looks like an ICL acting correctly (So Far). I try to think of the rational side of that statement that , “All Miners will go bankrupt, even if Gold climbs higher“. Really? Is that logical?
Let’s just say that Mining company ‘JJJJ’ are pulling 50,000 OZ out of the ground per quarter, Now as gold goes from $1200 to $1500, they sell their $gold for $300/oz More. How can they not rise, when they are banking $300/ oz more & selling 50,000 ounces? ( $300 x 50,000 oz= $15 million extra / quarter). Miners wont go BK if Gold runs up $300 / oz.
Currently, GOLD is bottoming and is holding up well(so far). Miners are bottoming, and they are trading like Miners, extreme to the upside, extreme to the downside.
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GOLD AT MIDNIGHT EASTERN TIME: A break above roughly $1203 puts gold as a break out above this channel. Will that help Miners? That remains to be seen.
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UPDATE: We do have a break out for Gold, and what looks to be a 1/2 cycle low. LET’s SEE IF THIS CAN LIFT MINERS.
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If you were stopped out and do not want to trade Miners at this time, that is fine and understandable, they are currently not acting predictably. Gold was up $5 Wednesday morning, and Miners sold off. Just watch the analysis for a while and see how it plays out, you can always change your mind later. For now, I still believe that this is a bottoming process in both Gold, Silver, and Miners, and a massive rally should follow. That rally will take place when the ‘time’ is right. In the meantime, I have been finding a few other trades to keep us busy.
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lets see what Thursday brings our way!
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~ALEX
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GDX WEEKLY – I just noticed this today. GDX seems to have a channel with a series of lows.
1. It broke the lows in 2017 and back tested the channel (blue arrow), did a final drop (red arrow), and the rally began.
2. Will that happen again? I don’t know, but we broke the channel, back tested it ( blue arrow) , and did a ( Final?) Drop.
GDXJ WEEKLY – AND GDXJ has landed on the downward sloping channel on GDXJ. Maybe it holds, since we see Juniors holding up better ( HMY, GSS, SBGL, AAU, MUX, ETC).
ADDED THOUGHT ON MJ STOCKS
My Opinion on These MJ companies: Real or not?
I can’t say which companies will outlast, outwit, outplay, but some will in a big way. 🙂
However, I feel that this is still just the start of something big, and many of the Major Bull runs start like this. Strong rallies and strong pull backs with bases in between.
At this point, some are getting over heated on their run higher & will surely drop, but this is a very constructive way of trading. The internet bubble was years & years of companies running higher, eventually a blow off top atmosphere. This is more of the start of companies vying for space in the industry.
This Business is a massively growing industry, just now being legalized, so think of the growth potential. This is the infant stages of start up companies, in my opinion. They are still learning how to run their business, how to successfully Grow their business, learning how to legalize this business, learning how to become profitable and gain more market share by reinvesting in their company, even buying out other companies.
AAPL was $8 once.
MSFT was $8 once,
$AMZN was $8 once,
PCLN was $8 once.
CRON was $8
$CGC was $8
TLRY was …$20 🙂
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Yes, they are extended now, but you might want to seriously consider buying the next dip after a long base forms. I have bought the last few as they base & break higher, and the gains are very real. VERY VERY REAL. See the CGC chart for example. $1 to $55, and many think this sector is a joke. This is getting very extended and will pull back soon, but as it forms a base, Stocks like this can run again and even split and run up again later.
