Friday July 5th
The U.S. markets were closed from Wednesday afternoon to Friday morning. We now have 1 day left in this week to trade, and I wouldn’t be surprised if many are just taking a 4 day weekend, so we may see light trading. Let’s do a quick review of where our markets stand currently…
SPX – The SPX has been breaking to new highs. Stops were raised to where a 1/2 cycle low seems to have taken place, so if you were long, you’d still be in this trade. You may recall that the SPX & QQQ looked good, while the RUT & TRAN were questionable…
TRAN – The RUT & TRAN reversed higher right above support, so these stops would not have been hit either.
VIX – And the VIX, which looked bullish above the 50& 200 sma, broke down this week.
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WTIC – oil dropped Big on Tuesday, so I pointed to the Big Drop in May and simply mentioned that if Oil turns higher, you still may want to be cautious, it did that in May & still fell apart.
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WTIC – On Wednesday, that is what we saw. Oil reversed, but I’d still be cautious. That’s resistance overhead so far.
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USD – The USD Moved higher and Gold stalled.
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GOLD July 2 – The last time we looked at Gold, it fell below the 10sma, and then recovered. That looks like a dcl…
GOLD – Wednesday Gold shot up and then pulled back, but it still remains above that 10sma. If Gold remains choppy it could form a handle as shown, but if this is the start of a 2nd daily cycle, it also could just take off higher.
GOLD – As I write this report Thursday night Eastern Time, Golds 30 minute chart formed a wedge and broke out of it. This does resemble an inverse H&S and if Gold can continue to climb, it will try to push to new highs again. If it fails, that handle may form, but if it breaks out, it can run much higher.
SILVER – Silver is lagging, but it is not a bad chart, this is a bullish set up too.
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GDX – From the May lows, GDX & GDXJ have had a great run, but if that is a ‘continuation’ gap, this can continue even higher to my original targets of $27-$28 in this daily cycle ( It may go higher if it extends, but those are initial targets).
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Honestly, there is not much new to say for our final day of trading this week. The set ups in Precious metals remain bullish, Steel, Aluminum, Copper, Platinum stocks also look good, and now the General Markets look good too. The only difference that may come about today in the US Markets is that many traders may have taken a long 4 day weekend this week, so that can lead to lighter volume. In lighter volume, it is actually easier to push a market around without resistance, so…
Let’s see what the final day of trading this week brings our way – Happy Trading!
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~ALEX
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I want to discuss Miners running higher here, and then a couple of other stock picks.
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RGLD 2016 – Recently I showed this chart of KL from 2016. I was pointing out that in a strong move, it may not back test the 50sma until later. In Feb, March, April it just ran higher & back tested later- Higher up. I drew this so people wouldn’t SELL EARLY & TRY to buy a ‘back test’ later. Just ride them for a few weeks …
RGLD – This week I also posted this chart JULY 2nd to show how Gold dropped $24 Monday, but Many Miners hardly flinched. Read the chart. So again, we are holding a basket of Miners until things change.
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RGLD – Even with RGLD up about 25% from the May lows, but some of the smaller juniors are actually doing a lot better, up 30-50% or more. Some of those that are lagging may play catch up.
KL – This was my chart of KL as a buy on June 3, breaking that 50sma at $32 with Big Volume. That is 1 month ago.
KL – On June 4 it continued higher, now forming the cup. I was pointing out how in the past it did a running correction, not a pull back.
KL – As it continued to extend quickly, I mentioned that is a handle forms, you can to add to it, but still don’t sell, in case it keeps going.
KL – It did drop, then reversed sharply. It could form that handle or it still could take off
KL – And it took off and didn’t look back. We are seeing strong bullishness in Miners, so we want to buy (or add to current positions) at support levels, especially with some that are bullish but not as extended.
AU – This is certainly too extended to buy, but a great run so far. This was a buy as it tagged the 200sma at $11, or buy near $12 as it broke out. Almost a double.
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NOT EXTENDED
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CDE – CDE is up over 60% from the lows in 1 month. I’ve been posting CDE as a Silver stock that is not extended, yet it is acting correctly. This looks like a Bull Flag. You could Buy the break out or add anywhere here if you can take a little choppiness.
HMY – HMY is up almost 50% off of the Fed Minute Lows, but I still view this as a Buy or place to add for long term buyers, because …
HMY – It is trying to break out from a multi year base.
NG broke from its multiyear base, and it has rallied strongly, straight up. DRD did the same.
EXK – EXK is another Silver stock that is not extended at all, but it is acting correctly. It may be waiting for Silver to run, but it is a low risk buy at the 50sma.
VGZ – I showed VGZ from the day Gold dropped $24. It was down 1 penny, so I think that is telling us that these Miners are being accumulated on the dips. It closed a bit higher then next day and…
VGZ – It also has formed a nice long base. I wouldn’t mind a nice run to $2 from my original entry under 60 cents, even it if takes a couple of months.
ALO – This reversal was in my report earlier in the week too. Why? I am trying to show everyone some lagging Miners that look Bullish. That was a nice reversal and Gold was down $24 that day. That is encouraging …
ALO – Today it is 78 cents again, still holding above that 200 sma.
This chart of PLG was in my report June 28th, showing how it was possibly flagging under the 50sma (a BUY or buy the break out), and the MACD was rising as Price dropped. The RSI was pushing the 50% line too. PLG was $1.28
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PLG – PLG is now $1.43, broke that 50sma as a 2nd buy, and can run To or Through the 200sma next. It is acting correctly.
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GENERAL MARKETS – I am asked, “Do you see any General Market picks?” I haven’t been looking as much as I usually do, since it has been choppy. Many set ups were choppy or failing, but I’ll discuss a few ideas. Personally, I think that the Miners have been very rewarding, and the better place to be…
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AMD – I kept recommending AMD at the 50 sma, but it wouldn’t just take off & run and I wondered why? I took a step back. It is a bullish set up, but AMD is pushing a resistance area, and doing so when the Markets have been choppy and sideways, so we’ll see if it can finally break $34 area on the next push higher. It is up 100% since January, but this would NOT be an easy ride.
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I think that the MJ STOCKS may come alive again soon, so I have been watching those.
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I mentioned TLRY earlier in June near $40. It is a BUY again here above the 50sma, now near $48. CGC & ACB looked a bit interesting too Wednesday. Take a look at the reversal on CGC if you are interested in this sector.
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INOV – Another choppy candidate, but it looks like a flat topped wedge and a break higher is Bullish.
OSTK – OSTK is a tricky ride, but it is climbing the 10sma . It seems to Burst higher, then tag the 10sma, burst higher, then tag the 10sma, now it has burst higher. Buy at the 10sma?
UEPS – This has a long base and good price potential as it recovers. It is a good set up and rsi gained strength, but risky when you look at how it dropped on the left hand side of the chart. It is above the 50sma & could run higher. Watch for earnings.
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Can we talk about some of the Miners VS other Bullish Stocks
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AAPL – yes, I do see this as a bullish set up, above the 50 sma. AAPL is up 10% from the lows 1 month ago. I’ve seen AAPL, GOOG, BIDU, etc double in a year …
TWLO- Here is a stock that doubled this year since last December. It is an up-trending channel, but look how choppy it was all the way higher. That is NOT an easy ride, but again, 100% in 7 months is great!
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But let’s look at some Miners, because these are turning out to be a very special trading opportunity.
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JNUG – yes, it is leveraged, but catching it near the Fed Minutes saw it run up 100% already
EGO – EGO ran slightly over 100% in 1 month. MUX & AUY are also up nicely, 50% in a month…
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AU – $11 – $18 in a month. This was a clear buy at the 200sma or the break out.
TRX – Did you know that TRX was up almost 300% this year at the Wednesday highs?
NG – Straight up, 65% in a month.
DRD – Straight up about 80% in a month.
SBGL – Also up almost 50% in a month from our Buy point.
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Many of these Miners are making great gains very quickly and over time, I think they’ll make even bigger gains if we get that break out in Gold & Miners ( We are getting that break out now). Not only that, but Silver is lagging a bit.
If Silver finally breaks out and runs, I think that many silver stocks could be doing something similar to this.
AAPL took almost 2 years to run up 100% from the 2016 lows. Miners are small, move quickly, and they can do that in weeks under the right conditions, and…
