Friday – The Last Trading Day Of The Week
SPX – With Wednesdays reversal, we had an ‘Unconfirmed’ swing low that could have been the dcl. A Confirmed DCL needs to close above the 10sma, but we saw price rejected there Thursday. Price can bounce here and break the 10sma & confirm a swing low ( & dcl) or this CAN continue lower as it seeks out that dcl. Please read the chart.
NASDAQ – This means that the sell off that we are now seeing is taking on different characteristics than all of the prior sell offs. See the RSI, MACD, Stochastics, etc. This could be the start of our drop into the ICL.
USD – The US Dollar was rejected at the down trend line Wednesday. Thursday it dropped to the 10sma, reversed, and closed higher. This may now try to break out again. This seems to be affecting Gold, with Gold doing the opposite of the USD. Notice that the USD dropped & recovered…
GOLD – Gold Popped & reversed lower. So far we have had a very choppy daily cycle, as seen here on this chart. NOTE: This is day 20 of the daily cycle and there has been a lack of follow through higher on each attempt. As this daily cycle gets older, it may become even weaker.
SILVER – The volume on recent ‘up days’ has been low, so we should not be surprised if Silver breaks down eventually into an ICL. So far it has remained pretty healthy though a bit choppy too.
GDX -POP & DROP and a little more chop, again and again. This too has been choppy and sideways, and we expected this as a possibility over time. We also need to at least expect in the back of our minds that as this daily cycle gets older, it could weaken and break down. Evidence of that is a series of lower highs so far and a day 5 peak on this daily cycle. please read my chart.
GDX – So we are getting late in the daily cycle with no follow through higher. Please read this chart too.
GDXJ – If we just take a ‘basic technical analysis’ view, we would say that GDXJ has begun a down trending channel. A drop into a DCL (or ICL) can bring price to any one of these support areas over time.
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Today is Friday and we have reached the final day of trading this week. We have seen some choppiness and downside price action in all sectors as they seek out their dcls. Think about this: The General Markets were very strong for months & the rising price channel was very bullish, right? Yet they still found a way to sell off sharply into this dcl. So couldn’t Precious Metals do the same as the daily cycle ages? They could.
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That said, Friday may be a time that you think of whether or not you want to adjust your accounts to fit your expectations. We didn’t get follow through higher in Miners again, and it is day 21. We are getting later in the daily cycle- a time when daily cycles can deteriorate. General Markets should be putting in a dcl, but they seem a bit heavy too. Let’s see what happens there on Frday.
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It has been choppy and difficult, so I will have a few of charts / ideas below to review. Some are the stronger companies from the General Markets. Enjoy your Friday trading & your weekend!
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~ALEX
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WRN at 10:30 a.m. – This was a buy in my recent reports. Here yesterday I was pointing out in the live area that WRN gapped open and filled the gap, so I added to my position on the reversal. It was acting correctly.
WRN – Even with the markets selling off into the close, WRN closed at the highs, up 10% with strong volume, so that gives us confidence that the trade can work out.
SPAQ – I still see SPAQ eventually making it to the $21 area. I own it and it is very choppy ( or has big swings daily), but if you notice the rise here, it is a series of higher lows too. As a warning, this did swing from $16 to $14 2 days ago- this is not for everyone, but I do expect it to do well over time. It has been a swing trade for me since the $12 area.
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During a bull run I like to look at the more bullish companies to see if a pull back may be a buying opportunity or is it breaking down. If the markets are breaking down, they may show signs of weakness, if the parabola continues? They may run from here. I’m thinking of ETSY, BOX, W, JD, TWTR, UBER, GRPN, AMZN, SHOP, etc. NOTE: IT IS BEST TO CHECK & MAKE SURE THEY RELEASED EARNINGS ALREADY OR NOT IN THE VERY NEAR FUTURE TOO. ETSY, W, BOX, JD looked good after earnings, but some are breaking down more than others.
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ETSY – So with ETSY, this was a nice healthy run but it is breaking down below the 50sma. That is ok, it may just become a shake out. A push above that 50sma after a market dcl makes a low risk entry , and a stop can be placed below that 50sma or recent lows.
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BOX – In August BOX had better than expected results and strong guidance. This looked good, running from roughly $16 to $21. It pulled back with the markets but when the markets turn, I would expect this one to do well (at least short term).
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JD – This company has done very well and is pulling back a lot less than the others. This is more of a bullish break out August 17th and a normal back test. If it keeps dropping, it could be bought at the $70 area support, but this one has been strong & may not pull back further.
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DIARY OF A TRADE: BYND
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BYND: ( $50 to $80) was recommended here back in March as it left the lows. It had great potential, since it had such a strong run before the crash.
BYND was again highlighted here in May 7. It rallied from those March lows & stalled at the downtrend line up at $110. After a crawl it broke out. You can see BYND rally May – Aug 2019, that is why I liked this potential. Back to $240?
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BYND (NOW) – BYND ran to $160 and has now pulled back & consolidated that $50 to $160 run. To complete the run and form the giant cup like pattern, it can double again from here.
