Friday September 27th – Directionless
SPX – After reversing on the 50sma, the SPX remained under the 10 sma, so we need more time to see whether that was a day 36 dcl and this was day1? Or was this day 37 and the general markets drop further? The Chop has made this become temporarily ‘directionless’.
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USO 2:21 p.m. – After a drop Thursday morning, Oil started to make a comeback, so I captured this chart of USO…
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WTIC – Now we have 2 side by side ‘drop & recover reversal candles’ off of support. It looks good, and a dcl could form on support, but this too has become momentarily Directionless.
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WTIC YESTERDAY– We still have that lower blue trend line holding price, even after Thursdays trading.
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XOP – XOP dropped and started to recover too. Using the 34 sma, price is pinched between the 34 & 50 sma. It is finally nearing oversold.
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I NEED TO CLARIFY NATGAS:
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UNG FOR NATGAS FROM YESTERDAYS REPORT – This was not a buy yet. I mentioned that it is coming due for a dcl, so I’m watching the 10 sma. This could definitely drop to the 50 sma and it is not oversold yet. I was pointing out that NATGAS is worth watching.
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NATGAS CURRENT – NATGAS dropped another 7 cents and is heading for oversold & the 50 sma. Look at that 50 sma and how it acted as resistance in March, April, May, July & August. That could become support after the 200sma became resistance.
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GOLD – At a glance, GOLD & SILVER look o.k., but look at that MACD Kiss. Miners seem to be leading the way lower, so I think that we will see Gold break that 50 sma soon. This was a day 10 peak so far.
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The idea of GOLD pulling back from yesterdays report. ‘Lower highs and lower lows’
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SILVER – Again Silver looks ok at a glance, sitting on the 34 sma, nicely above the 50 sma, but that MACD also kissed the red line goodbye. Silver chopped sideways, Popped , & dropped so it too is looking to find a direction. Let’s look at Miners…
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GDX #1 – GDX, GDXJ, and XAU closed below the 50 sma and now the 10 sma. Volume lightened up a bit, so I would say that it can bounce, but knowing cycle timing, it leaves me looking at this as a day 7 L.T. Peak so far. That is how this could remains going forward, even if it bounces.
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GDX #2 – And we’d get that A-B-C down that I have been calling for. Here is my best GUESS. I’m looking at…
1. It would fit an A-B-C type drop.
2. It would be supported at a Fib level, the same as the drop to ‘a’ was.
3. A Back test of the 200sma is normal in a bull run
4. The 2nd leg would be very similar to the first leg down.
Again, that above chart is an educated guess or a ready GUIDE for now. I will obviously watch how things unfold and make adjustments in my thinking as the action presents itself. The start of a drop into an ICL is much like a Puzzle that is only partially finished. You get a good idea of what the picture is going to look like, but you get the exact representation only after each puzzle piece falls into place. I’ll take it a step at a time.
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I’ve discussed a few things that I am looking at for potential Oil / Energy set ups in recent reports, but this report will not contain any ‘Picks’, because the recent moves have been a bit choppy and rather directionless. Oil/ Energy stocks drop in the morning & try to recover into the close. Also, I am out of Miners after selling EXK & BTG Thursday morning, but I held on to my JDST . If you don’t usually like to go short ( & we could get a bounce at any time), then CASH IS KING . We will have an excellent buying opportunity at the ICL. The last one was very rewarding, and these Miners do look like they have unfinished business to the upside. A good solid pull back is just what we need to dampen the bulls sentiment and prepare the proper set up. I’m also hoping that Oil / Energy will finish up crushing my hopes so I can get that ideal Buy there too 🙂 . I do still own my recent GUSH position.
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Today is Friday, the last day of the week, so it may be best to sit and wait for future confirmation of a dcl in Oil and the General Markets. For those that do not like to short, it also may be best to just wait for that ICL in Precious Metals.
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Enjoy your Friday trading!
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~ALEX
