Weekend Report December 21st
SPX WEEKLY – So we have seen the General Markets break out and as discussed in prior reports, there is always a chance that these can just continue ramping up ( Melt up mode). There is also the chance that we back test that purple line that was formerly acting as a resistance line. That would be normal and would happen on the next daily cycle low. NOTE: Look closely and you can see that the purple line was actually back tested 2 weeks ago.
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SPX – I posted this last weekend showing that prior breaks of the 10 year trend line were false break outs, so I just want to keep that in mind. BASICALLY, as long as these markets are ramping up, you just stay long with a stop under the 13 sma area.
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QQQ Daily – I want to use the daily chart just to look back at how this is playing out. With a stop raised up under the 13sma, you’d still be in the trade. We have a day 13 peak now. If it drops from here it still could become L.T. as it dips into a dcl. That is a ‘topping’ type of candle, especially if the markets Gap down Monday. We saw something similar in November & it just ran sideways. Read the chart.
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WTIC DAILY – We have a break out in Oil and it started to climb higher daily last week, instead of the non stop choppiness that we had been seeing. Oil stocks have also moved swiftly out of their lows. This is a short term break out, because…
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WTIC – The longer term 6 year chart shows us almost about to break out. A pullback into a DCL on the daily would be a nice place to buy, because then the oil market may break out of this chart too.
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USD – Even though the USD is weakening with lower highs in November, this reversal at support looks like the USD wants to try to push higher again. If the USD pushes higher, it could dip Gold into that DCL.
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This was in Fridays report and remains a valid thought.
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GOLD – I got to thinking that since this is day 28 on Friday, GOLD can open Sunday night and trade for hours before the US markets open. So thinking ahead, I was thinking:
1. What if Gold trades up $10 Sunday night and then another $10 before the markets open in the US? That is up $20.
2. It could just as easily trade down overnight Sunday too.
3. The challenge is that this Would affect your GDX / GDXJ open one way or the other.
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GOLD WEEKLY BIG PICTURE – Gold has gradually pulled back in a nice gradual Bull Flag. In the past Bull Run, this is the area that it would begin to launch higher, but since this is a weekly chart, it can quickly dip down next week & reverse higher after that too. If you blow this chart up, you’ll see that it did a quick spike down to the red line at times in the past in 2009-2011.
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SILVER– Silver has a bull flag type consolidation too. I drew a channel that seems to be holding Silver.
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GDX – GDX has moved off of the November lows and it triggered a rare buy for me. I am not getting the immediate follow through that I like to see, and timing-wise a dcl could be coming due, so a short term drop is possible, but I still expect the rally to begin in Miners soon.
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GDXJ – GDXJ is the same. We broke from that LONG BASE / CONSOLIDATION and back tested that area recently. GDXJ began to move higher and broke that flags down trend line.
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In Fridays report, I posted that a drop to a dcl in GDX is possible. That would act as a shake out, to cleanse Bulls from their positions, but I honestly don’t think that it will be deep.
I posted this :
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GDX – Now if GDX opens Monday with Gold down $15-$20 or so, GDX could gap down like this. JNUG OR NUGT would drop sharply. So are you currently positioned in a way that you will not panic, or feel dread? This chart helps us to see that we want to be personally comfortable with our current holdings, even if we get the gap down. That said…
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GDX – If Gold trades up Sunday night into Monday, you honestly could see a $1+ Gap open in GDX or GDXJ. Are you invested enough that you will be comfortable seeing this?
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That is where the markets currently stand. Next week is a holiday week, so it is hard to say what kind of trading we’ll see. It is often a week where traders & Fund managers, etc. take vacation- possibly 2 weeks off into New Years.
The markets close at 1 p.m. Eastern Time Tuesday and are closed all day Wednesday, so I would expect light volume trading next week, but we’ll have to wait and see.
Enjoy the rest of the weekend!
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~ALEX
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JUST A REMINDER : 2 charts
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THAT 2016 RIP YOUR FACE OFF RALLY…
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These are older charts from a prior report, but I just wanted to remind everyone about that 2016 massive rally in Miners. GDX Started with a scary sell off after making new highs. It looked very bullish at those new highs and suddenly it dropped. THAT shook the bulls out & many did not dare to get back in. We rode this higher from the reversal lows…
Now let’s look closely: We had a final daily cycle that was showing progress on day 33 (Unless day 20 was a higher low dcl, which also wouldn’t make sense)! It even made a new high in January on day 33, but suddenly it collapsed & dropped sharply. THAT was right before a sharp rally higher left many behind.
I am just posting this here because we see GDX as bullish now too. Currently GDX looks like a higher high late in a daily cycle now too. If that is the case, IT SHOULD NOT Crash down, but in the stock market, we NEVER SAY NEVER. It can happen, it has happened in 2016, but if we do see a quick drop it will likely be a short lived shake out.
HISTORY SHOULD TEACH US A LESSON: For those that say the stocks look bullish, so there is no way Miners can move higher with the stocks moving higher. Haven’t many already been doing that? HL, SBGL, SVM, PAAS, etc – running higher with the markets. Not only that…
Look at the last ICL MAY 2019. This chart is SPX & GDX running higher together through June & July. I saw it in 2016 at times too. That means that yes it has happened, yes it can happen.
