Wednesday May 22 – Fed Minutes
Today the Fed Minutes are expected to provide insights into the May 1 central bank meeting. Policymakers decided to keep interest rates steady, and I do have some interesting things to show you pertaining to that. 2 P.M. Eastern Time will be the time that the minutes are released, so set your alarm 🙂 Let’s take a look at the Markets.
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SPX – This was the SPX in yesterdays report, showing a possible back test and the DCL is in place…
SPX – Tuesday did see the markets moving higher again, so maybe you bought UPRO, TQQQ, etc , or looked at your check list and added a stock or two? This gives you breathing room and if this progresses, you can raise your stops.
The General Markets are on their 3rd daily cycle and I still want to admonish continuing cautiousness ( Use stops), in case this peaks as a Left Translated Daily Cycle and begins an ICL sell off sooner than later. I do still see things that would make me cautious, so I will share a little more with you later in this report. Also remember that the way the Vix is set up can lead to bearishness.
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WTIC – So far we have a dcl , but this time Oil has moved sideways out of the lows and not higher like past reversals. The Oil inventory report is released on Wednesdays. Oil has been a bit choppy, but it was a buy at the 200 sma with a stop and continues to hold up.
UUP for the USD – That looks like a temporary top for the USD. A top is not 100% guaranteed, especially with Fed Minutes being released, but that is often a topping candle. That could be good for Precious Metals.
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PRECIOUS METALS
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GLD After an HR of trade – As Gold dropped yesterday, I posted this in the live area to show that Gold / GLD did NOT break the lows and maybe we just needed GLD to fill the gap here on day 13. I then said, “We’ll see how things look by the close. “
GOLD – So on day 13, Gold threatened to break those lows, but then price started to reverse as the day went on. SO FAR, the DCL (possible ICL) is still in tact.
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SILVER – Yesterdays report had the Silver COT, which was already near ICL levels. Since that COT report, Silver dropped to the bottom of this channel, or…
This wedge that I pointed out on May 17th
GDX – GDX dropped to the 200sma and reversed into the close (Again). As the daily cycle progresses, we are still just seeing choppy sideways trading, but with the release of the Fed Minutes, we may get a directional move. Let’s talk about that.
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HOW ABOUT SOME FUN FACTS
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GDX GLD RATIO – A bullish sign for the Miners is when they outperform Gold and so far we are seeing that continue.
You may not have realized this:
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GDX – Did you know that after the FED Decision on May 1st, GDX dropped for 1 day and THAT WAS THE LOW. So really, it was a false drop or knee jerk reaction to the Fed Mtg. Since it slowly climbed higher after the MTG, it could move higher after the Minutes. We shall soon see.
GOLD FUN FACT – Did you realize that THE LOW for Gold was on the Thursday drop after that May 1st Fed Mtg, and then it ran higher? What will it do after the release of the Minutes?
MINERS FUN FACTS – I have heard some say that ‘GDX & GDXJ just do not feel like an ICL type drop’. Maybe not, but they are a Mixture of Miners. SOME Miners that I look at definitely look like an ICL drop, as seen here with EXK back at November lows. That looks like an ICL drop.
My thinking is simply that there are others similar to EXK that do also look like an ICL drop, but with some Miners ( KL, MAG, FNV, etc) holding up better or experiencing accumulation, GDX & GDXJ are holding up better as the result of a mixed picture.
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MORE MINERS FUN FACTS – “Doesn’t the BPGDM have to drop a lot further to be an ICL?” No. Past ICLs had the BPGDM at varying levels, however Look at the Current BPGDM RSI READING. It hardly EVER got deeper than where it is now. Prior times that it was at this level were indications of an ICL VERY CLOSE OR IN PLACE. It did NOT keep dropping.
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It is the day for the Fed Minutes to be released. At the FED MEETING, we had false knee jerk reactions, and I think that many forgot about that, so I wanted to point that out now. I do remember Gold dropping when the Fed spoke and discussed inflation being tame, and inflation not being at 2% like they would like for it to be- so that may show up in the Minutes and cause a lot of volatility here today. So far, Volatility & Choppiness has not broken the lows, so that is what I am looking for going forward. Will the recent Lows Hold or will they be broken?
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I will discuss a few more things below, so for now I will sign off and wish you to enjoy your Wednesday trading- but expect some volatility after 2 p.m. Eastern time. Stay Frosty and use stops!
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~ALEX
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SOX – This is interesting, did the SOX just do a perfect back test and everything is going to be fine? Or…
SOX – Did it break to new highs, suck in the Buyers screaming “Buy this break out to new highs!!”, and cause a bull trap final top? Time will tell, but…
INTC – Some of the Semiconductors no longer look very bullish. This Cup was perfect, but that slam down is ugly & breaks the cup pattern. Look at the Plunge! 5 weeks erased 6 months. Look at the volume, and check out the MACD. INTC makes it look like Semiconductors may have some trouble ahead.
Also another observation to take note of:
SPX – Hmmmm…. Did anyone else notice on the SOX Chart and here on the SPX Chart , the bullish news of ‘No Interest Rate Hike ‘ actually is where we saw the markets ‘peak’ & the selling actually started on the Fed Wed of May 1st? What will the Minutes do?
It will be interesting to see how things play out after the Fed Minutes come out. If we get the same reaction over time, then the General Markets could begin to sell off into their ICL, and Precious metals bottomed and will begin to move higher. If lows are broken in the precious metals, we may get the opposite reaction to the minutes. Time will tell, and it may take a few days days to actually get the real reaction or follow through.
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CDE – Now THIS looks like an ICL sell off. CDE put in a reversal and it is at the wedge Apex. Maybe the Fed minutes will rescue CDE?
CDE – Even if you draw the wedge like this, it looks ready to move higher. CDE under $3? I get the feeling that someday I’m going to wonder why I didn’t grab a boat load of CDE here.
HL – After a BIG Sell off, Hecla put in a reversal Tuesday too. HL back at $1.45, I never thought I’d see the day, HOWEVER…
HL – If I only checked the charts, maybe I would have expected it. Prior lows came in near here, so maybe yesterdays reversal will get a boost from the Fed Minutes and the final ICL for HL will be in place? We shall see. Hecla was actually the very first Miner that I bought, and it was under $1. From here it can run several hundred percent.
GFI – A month ago I mentioned how GFI hardly got caught up in Golds sell off. It still had not dropped to the 200 sma and seems to be in a trading range.
GFI – A month later it is still in that trading range. As it started to reverse Tuesday Morning, I posted this chart less than 1/2 hr into the trading day. At that point, GOLD was down, but GFI was moving higher at the right turning point…
GFI – By the close we see it up to the 50sma again, and volume came in strong. If the Fed Minutes is a catalyst for this sector, GFI is worth watching.
1. A break out from this 4 month consolidation should make a good run, similar to Sept to Feb.
2. A drop would probably find support at the 200 sma.
GSV – Gold was down Tuesday morning and I pointed out that GSV was up 8% & breaking above the 50sma. At the end of the day, I drew this base as a possible shake out & inverse H&S. You could buy it with a stop, but if the Fed Minutes does not act like a bullish catalyst- we may just get more sideways chop.
LODE – Hopefully LODE is just back testing that 200sma and trend line.
So at this point, we have plenty of Miners that look like they have started to shape up , base out, and may be ready to move higher. We’ll see if the Minutes act as any kind of a trigger for a directional move? Keep in mind that that move could still be Higher or lower, but we are seeing possible bullish signs so far.
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LBUY & VIVE were bullish MJ trades last week, coming out of the lows – These trades are still working out, and several MJ Stocks also look to be set up bullishly.
NBEV – NBEV released earnings on May 9th , “Net Revenue Growth of 404% , gross revenues increasing to $60.5 million compared to $12.8 million in the prior year. Net revenues reached $58.3 million compared $11.6 million in Q1 of the prior year, an increase of 404%. New Age’s cash balance increased to $110.0 million and total assets increased to $349.5 million.” The stock looks like it is starting to move higher out of a tight triangle pattern, riding along the 180 ma, and…
NBEV – This is a very long consolidation of the blast higher from $1 to $10. I do think that this has good potential for a nice run higher when it finally gets going. I bought this in this area.
PLNHF – I grabbed this chart before the market closed, and PLNHF reversed and pushed back through the 50sma. It actually closed with almost 500,000 volume, so this sector may begin to perk up again. HEXO, ACB, CRON,
CRON – And when they Run, they run strong. When they dip down? Get out of the way until they are finished selling. I don’t buy & hold these MJ Stocks, but they really do make large gains when they run higher after the selling has finished up. CRON may be finished with its selling too.
HEXO , ACB, CGC, etc are a bit choppy, but still holding up ok too.
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VSLR – The Solar stocks got choppy too, but VSLR never hit the ‘stops’ and is back near the highs. This was too choppy for me to hold, I bought and took my gains a while ago.
RUN – Another Solar stock that got choppy, but looks ready to break out. You may also want to watch JKS, SPWR, CSIQ, etc.
MANY OF THESE SECTORS, LIKE MJ STOCKS OR SOLARS, WERE CHOPPY, SIDEWAYS MOVES AT THIS POINT & MAY BE WAITING FOR THE GENERAL MARKETS TO MOVE HIGHER, SO AGAIN, WE’LL SEE WHAT HAPPENS AFTER TODAY.
