Most of my reports have included the words ‘Choppy’, ‘Volatile’, and ‘difficult’, because of the whip saw type directionless action that we have been seeing.  Well, The Fed Chairman gave a little speech Wednesday, and the ride continues on.  Let’s discuss the current Market set ups…

 

SPX – This chart is from yesterdays report. I was expecting this bounce to the 50sma over the next few days, and wanted to see if the 50sma might act as resistance…

SPX – Well that was fast!  That was a big 1 day surge that may have included some short covering after the Fed Speech.   We are already near the 50 sma and yet this is still oversold.  I see bullish momentum on the MACD, so now I’m interested in seeing if this can break higher through the multiple resistance points. Breaking this magenta down trend line would be rather bullish.

 

LABU – I mentioned LABU as a bullish set up 2 days ago, and I think it is about to break out.  It popped 12% Wednesday.

*** NOTE:  So it seems that the FED mentioned that interest rates are close to neutral.  That was a change and suggests easing up on rate hikes in 2019.   Will that help the markets longer term?  Time will tell as things play out.   I think that it is important to mention that in all of these sectors that POPPED with the FED SPEECH, they also could also be affected in the same manner (or the opposite manner) after the G20 Meeting on Saturday,  so one has to decide this week-  “Do I want to go into the weekend fully invested in this choppy market with a G20 meeting taking place Saturday?”    Will trade wars continue or even accelerate?  Will China and trump reach any agreements? We could Gap higher & blast off Monday,  or we could gap lower & crash down too.  That said, Position size, if any, will be important. Today is Thursday, so you have 2 days to think things over & watch the action.

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WTIC  –  Oils daily cycle is over 70 days long and that is VERY overdue for a low, Oil actually made a slight new low Wednesday.

 

NATGAS  –  I figured that I’d throw this update in there.   After what looked like a parabolic run, we see a consolidation forming a possible bull flag?   This could be a 1/2 way point and NATGAS could be getting a lot more expensive.

 

UUP – After a slight new high, the USD gave it up.  This makes sense and it could be the peak for this daily cycle, because this is the 3rd daily cycle for the USD. It could now start to form lower lows and lower highs for weeks.

 

If the USD is now ready to start its drop toward a future ICL, One would think that this would be good for Gold, right?  Choppiness has made this a very difficult forecast.

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LET ME SHOW YOU SOMETHING ABOUT GOLD

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1. GOLD  MONDAY – Above the 50sma, it looked hopeful and Bullish on Monday, even though this was the start of the 3rd daily cycle.

2. GOLD TUESDAY  –  This was Gold closing under the 50sma during Golds 3rd daily cycle.  This now  looked QUITE Bearish breaking down Tuesday, since volume increased on the sell off and the RSI & MACD crossed down.

 

3. GOLD WEDNESDAY  – After the close under the 50sma, Gold surged with the Fed Speech midday, putting in a strong reversal?  Yes,  this looks bullish, but it looked quite bearish just 1 day before.  Again, these choppy frustrating markets continue to give us a sideways ride.  What can be said about this reversal ? …

 

  GOLD  – Many strong reversals or surges higher still just turned into sideways moves, as shown here. This still may not amount to very much in the bigger picture.  A break above this down trend line would definitely add to the bullishness and would threaten a run to the green 200 sma line. Read the chart.

I don’t want to burst anyone’s hopes, but please just allow me to point something out with the G-20 Mtg ahead…

 

  GOLD  – Gold has had a very big move higher recently on November 1st, but it rolled over too, right?  My emails are asking me, “Did this change everything?”  We cannot know from one strong day, since we have had that in the past and nothing more became of it.   We still need to use stops and be cautious if you went or remained long.  These markets are choppy & devious.

 

 

SILVER  – Silver actually looks like a bullish base with a shake out, recovery, trend line break and back test. I honestly think that Silver looks bullish here, but this has gone absolutely no where for 3 months, it can continue to do that. ‘Base’.

1. GDX YESTERDAY   – This definitely looked Bearish as it broke and closed below the 50sma.

 

2.  GDX   – Now GDX looks to have reversed at the lows?  Yes, this now looks bullish again, and so it can be bought with a tight stop, but 1. G-20 is ahead and  2. this has really been a choppy frustrating set up. 3. Day 6 can still remain the peak & this could break down next week, we just can’t tell at this point.       For example: My stop was below the blue arrow DCL when I bought, but I moved it up under the 50 sma, and I got stopped out at the 50sma as a result.  I would have to re-buy & risk getting stopped out for another short gain or loss.  Choppy sideways action is difficult.

Note: Choppy sideways action seen above is difficult, but after building a base like this, a  break out & run higher would probably begin to trend in that direction and buying pull backs would be easier & rewarding.  Nobody wants to ‘miss the move’ out of the lows, but this sideways chop has been causing paper-cuts for weeks now.  You must decide what is the best trade set up for you to pursue, meanwhile some individual Miners do continue to act bullishly.  Lets discuss this sector a little bit further.

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GDXJ   – We are looking for follow through.  We have seen large up days, but there is no guarantee that we will see higher price continue. Looking at the large day higher on September 14, the next 2 days were red.

 

GDX  – The current set up is that GDX has a day 6 ‘peak’ and today is day 11.  If that peak does not get  taken out, this will be a left translated daily cycle.  If price beats day 6 Thursday or Friday,  it’ll be a peak on day 11 or 12 so far ( Still can be L.T.) And then we face G20.   Do you feel lucky, kid? Do ya?   It is a very tough call here, because we have seen large up days and large down days often.

 

 

MINER THOUGHTS

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Are you frustrated because you feel you may be missing a move in Miners with all of the false starts and shake outs? ABX , AEM, KL, and others have been shown as Miners that have been leaders, and they ran well?     Well,  SILVER STOCKS are still at the lows,  you haven’t missed a thing, because Silver often roars higher when it gets going, when the time is right for it.  🙂  Notice…

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AG   – This is actually a series of lower highs and lower lows, so several Silver Miners like AG are at their lows. IF A big run was going to start now with the FED SPEECH followed by the G20 Mtg,  this would be a shake out, but you’d still be getting bargain prices.

 

EXK   –  EXK hit new lows, but suddenly looks like a bullish wedge. So we are getting more Mixed signals.

 

HL  –  Inverse H&S with HL.   Hecla  is also still at THE LOWS, but the RSI is at 50%.  Silver stocks look like they want to move higher. Next weeks post G-20 results may be the answer.

 

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AU-  And then we have bullish leaders pushing higher. Amazing.  These are choppy frustrating markets. so…

All I can say is that this is possibly the most mixed I have ever seen the Miners.  We have seen Many Silver stocks breaking to new lows right now, and yet several other Miners have been running higher and remaining bullishly at highs, like ABX, AU, etc.    We have GOLD & GDX breaking down below the 50 sma one day, and then sharp reversals that are news driven and often short lived. The USD is due for a drop, which is usually good for Gold, but GOLD is in a 3rd daily cycle, that is often when it weakens.  Throw in a FED discussion that sounded a bit more dovish and a G-20 meeting that may see Trump enforce greater tariffs on China or come to a trade agreement that is favorable, and you have more volatility, whip saw possibilities, and uncertainty.   I think that Today & Fridays action will be important when deciding how much of anything you want to hold going into this weekend.

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This type of choppiness often forms bases and will eventually end, leading  to some strong trending moves when the time is right.  MJ stocks may be setting up for a future run, Blockchain stocks all popped this week, an ICL in the General Markets is causing small bases to form in Tech, and Miners need to pick a direction and set up for the next run higher. It is a matter of time, and in the meantime I recommend just keeping positions reasonable and smaller than normal.

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*** NOTE:   Conclusion, I will say it again.   I think that it is important to mention that in all of these sectors that POPPED with the FED SPEECH, many jumped in ‘Long’.  That is fine, you can use a tight stop, but please know that these sectors also could be affected in the same manner (or the opposite manner) after the G20 Meeting takes place on Saturday,  so one has to decide –  “Do I want to go into the weekend fully invested in this choppy market with a G20 meeting taking place Saturday?”    We could Gap higher & blast off Monday,  or we could gap lower & crash down too.  Position size, if any,  will be important. Today is Thursday, so you have 2 days to think things over & watch the action.  I will continue to look for set ups along the way.

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Have a great Thursday!

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~ALEX 

 

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I have kept the trade ideas to basically 1-3 per report lately, basically due to this choppiness.  Now I am starting to see set ups that may lead to trades that are a bit longer lasting.   Solar has been one of them, and now after a lot of basing out, there may be others.  I will report more of them next week as buy opportunities, but I want to wait until after the G-20 meetings possible volatility reaction Monday.  After that has passed, things may settle down a bit more with less whip saw.   For now,  let’s discuss a few more of those trade ideas.

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ENPH – This looks hopeful for more than just a day or two trade.  The market sell off did not damage  ENPH, and it then rallied in early November.    I have mentioned Solar stocks as bullishly rising in recent reports and they have been acting correctly.  I bought ENPH, and posted this 2 days ago.  It bounced off of the 200sma and could be building a cup, running up to $7.50.  I’ll take that!

 

ENPH  – I think that it may just be getting started on a run to the July highs, so I even added to my position again, stop under the 50sma for now.

 

 

SEDG – 2 more solar stocks are breaking out,  SEDG & FSLR are ‘buy’ candidates.  Both closed just above the 50sma yesterday.

 

Look up CSIQ, JKS, SPWR, WNDW, VSLR to see how Solar stocks have performed. FSLR & SEDG may be starting their run.

 

NAT –  NAT got some follow through. I am still holding it because of the way it ran in October. DRYS is starting to run too, but this SHIPPING sector is a FAST sector & not for everyone. NAT is up very nicely since September lows though.

 

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Just an MJ STOCK Note:  Many popped yesterday too.  I did not buy anything, but let me show you a couple of things that I am watching for in this sector.

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CRON  – CRON and CGC are sitting on longer term support. This sector had many companies ‘Pop’ yesterday too. I am still watching this area before posting set ups, because this can drop quickly.  I would only buy one breaking above the 10 sma on a daily chart .

 

ACB – ACB hasn’t reached support yet, but if this sector moves higher, this could be bought right above the 8 ema or 10 sma.  That run from August was roughly $4 to $13!   Last Novembers run was even greater, so this is a sector that I watch constantly.   Let’s zoom in…

 

ACB AGAIN-  Again, Look at the run from August  after this reached support. That was roughly $4 to $13 in 1 month , so this sector is on my radar at all times. It did not run until it got above the 10 sma or 8 ema though.  The last 3 reversals under the 8 ema went nowhere.