May 22- No Big Changes Yet
This report is going to be rather short and to the point: There was no real change yesterday after the Minutes were released. Yesterday I pointed out that 1 day after the FOMC Meeting Gold bottomed and the Markets topped, so we’ll just have to wait and see if today, 1 day after the release of the minutes, anything changes. Let’s look at some charts…
SPX – No change, this remains choppy and sloppy so far. It seems to be unable to get back above the 50sma
QQQ – Unable to get back above even the 10sma (so far). That MACD is wide open and ugly too. That often is not a good sign.
DJIA – The Dow looks to be one of the healthier looking set ups, and the MACD is improving, but if it loses the 200sma, that would be bearish. It also is back under the 50sma.
TRAN – The TRAN is struggling at the 50 & 200sma & 8 ema.
WTIC – Oil DID CHANGE, but this change was not related to the ‘Minutes’. The inventory report is released on Wednesday mornings and after that, Oil plunged straight down. Losing the 50sma, this does not look good this early in a daily cycle. It peaked on day 10 and if that remains the peak, Oil could have a lot of selling days ahead. I didn’t go short, but breaking down on day 12 could lead to a 40 day cycle failing, followed by even another daily cycle down. I will be watching that 200sma.
GOLD – Gold did nothing. It didn’t break the recent lows, so it remains a choppy sideways move without giving us a clue as to what direction it wants to travel.
GOLD Same chart – We are now at the point where I have to say that a long sideways move often leads to a strong directional move, so if this breaks out higher, it could be a nice run. If it breaks down, do not try to catch the lows until this daily cycle runs its course. For now?
GDX – GDX broke below the 200sma & closed there with increasing volume. I did not go short, just in case this is a false break down, but THIS IS CONCERNING. Why? Because if that is not a false break down, a triangle pattern can be a continuation pattern. At times they are often a 1/2 way point, so I am keeping an eye on this area.
GDXJ – GDXJ broke the lows.
DUST – And DUST & JDST actually do look like bullish set ups ready to break out,so why didn’t I go short with the GDX break down?
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I decided not to short Miners because of what I wrote in yesterdays report. It has been very choppy and you may recall that I pointed out in yesterdays report that on the day following the FED DAY, we actually got The lows for Gold & Miners. That means that JDST & DUST had false break outs on the Fed Day…
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JDST – JDST & DUST broke to new highs at that time too & then just dropped. See my Blue arrow, that was FED DAY. The purple arrow was FED MINUTES DAY.
Now that the Miners formed a choppy triangle, the set up is more likely to have follow through. Why? Because we are later in a daily cycle that may have peaked by day 4 (very L.T.), any follow through lower could pick up speed into possibly a day 30 ish low. I might take a JDST or DUST position, but only if I see follow through. I wont recommend it here with this choppiness. You can decide for yourself if you want to try shorting Miners or not just based on my reports & Cycle counts. RIGHT NOW, THIS STILL COULD BE A FALSE BREAK DOWN POST FED , similar to the FOMC Mtg. It can remain choppy & hard to short.
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EDIT THURSDAY 7 A.M.- These are the Futures pre-market. The markets are red, The VIX is popping, Oil is selling lower, and GOLD is actually up a little. Any of these can change before the market opens or even produce a gap down & recover in choppy markets, so at this point, I’m mostly interested in seeing if these areas become directional moves too.
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GOLD pre-market looks similar to the day after the Fed Meeting, so we’ll see how this plays out throughout the entire day too. Maybe that was a false break out in Miners?
So nothing really changed yesterday with the release of the Minutes, and so far we have a sideways, difficult, frustrating choppy mess. It may be best to continue to KEEP ANY POSITION SIZE SMALLER, use stops, and wait for more of a directional move to unfold. OIL did change and it changed from Bullish looking to Bearish looking quickly! That MACD, High Volume, Breaking of Moving average support, etc is not pretty. It also may be short-able, for those inclined to do so. I have a few longer term trades on, and I am holding a few MJ trades like NBEV, HEXO, LBUY, and VIVE, but nothing very big. We’ll see how that MJ sector plays out as we continue to look for things to resolve out of the choppiness of the markets.
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I will have a few comments below, enjoy your Thursday trading!
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~ALEX
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MYT – So I found a few really nice set ups, like MYT for example, but I decided that I am going to wait and just go with the trade set ups that we have going. I liked AMD, GOGO, and a few others last week, but they continue to chop sideways. Things have been so choppy, that this could tag the 50sma & just chop around for a while. Many set ups in the tech sector that I bought pop & drop & chop, so I want to wait and see how things play out. Choppiness is not fun. I do like that High volume small drop Tuesday on MYT, followed by a high volume larger Pop yesterday though .
NBEV – So I have this trade on, and I added to it. I am watching things closely in case the General Markets drop and drag down MJ & CBD sales companies with it.
CGC – This is another MJ Break out above the 50sma, but again, watch the General Markets as well as your MJ stocks, just to see if MJ Stocks can resist the lack luster choppiness of the Markets.
CRON – CRON also pushed higher and if it gets above that 50sma, it could start forming a large Cup-like pattern. I actually grabbed this chart less than an hour after the markets opened to post it in the live commenting area. It closed with almost 6 Million volume at $6.13.
MJNA – I’m not recommending this one, just showing you that even some of the smaller ones in this sector are POPPING when the General Markets are Stalling.
OWCP – Another MJ Stock Popping while Markets are Stalling.
