Friday April 14th – The USD Is Breaking The Lows
Today is Friday, the last trading day of the week. I’m going to start with our little market mover – The USD:
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THE USD actually broke down on Thursday and this has big implications , so let me explain it in 2 ways:
1. Breaking below that DCL means that it is a weak failure. It can now drop for weeks and this should push the markets and precious metals higher for weeks. Now please do not “view this as a USD straight down move, so Gold is going straight up”. That is not the case, so
2. Take a look at the last large USD drop late last year and early this year (I put arrows there). Each time the USD broke a swing low, it bounced back to the 8 ema, so it became a stairstep lower.
3. And then try to recall that …
3. And then try to recall that Gold did run nicely higher, but it was very choppy. We even had some pretty big 1 day drops, but it held the 20sma as seen here. This chop higher made it impossible to see where DCLs were because the dips were short lived s the USD sold off lower. We might see something similar, but I’ll talk more about gold shortly. Let’s look at the general markets…
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YESTERDAY IN THE REPORT I MENTIONED THAT THE MARKETS SOLD OFF AFTER THE FED MINUTES, BUT I SUSPECTED THAT THE DROP WAS A FALSE DROP (there were just too many bullish set ups and The USD sold off to the lows). I SAID:
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The SPX gapped up with the inflation numbers, but sold off into the close on Fed minutes. It is on support, so Thursday will tell us if we are likely to continue to drop into a dcl soon, or not.
THE SPX put in a strong reversal right at that 10 sma support as the USD broke down. This is now a new high on day 22.
Bill mentioned LABU in the live area when it was only at $5.10 and it ended up closing the day up 15%. Something interesting was happening in the biotech / medical sector. I will discuss that a bit more later in the report.
As mentioned, The USD broke below the DCL and was a fraction away from breaking that ICL.
EDIT: I’m writing this at 6 a.m. and the USD has now broken the ICL Overnight, so the USD is weak and ‘failing’.
GOLD -Formed that Triangle as a continuation pattern for 2 weeks and then it broke out higher, back tested it ( & the 8 ema) Perfectly, and continues higher. THAT has to be considered a dcl at day 29. I realise that some Miners look very stretched (S. African Miners especially), but you have to own some Miners to make money on them, the next move has started, so we bought down at the 50sma…
GOLD –
I (and many here) bought in at the Oct lows with a basket of miners and I did sell as we started to dip and the USD started to bounce. Those were excellent gains. I didn’t go ‘All In’ with that double bottom low, because
1. It was caused by a bank failure and
2. The sell off was cut short, so it wsnt a certainty, and also because I trade Crypto miners and other areas. I did mention a few times that we probably saw the ICL and should be buying at the 50sma area with a stop. The Miners that I bought are doing very well, but again, I am trading crypto and other areas too.
Here I am showing how the 8ema is showing the strength og Gold. It holds the 10, 13 & 20sma perfectly, but even the 8 ema was supporting the last run.
I already pointed out that SILVER broke out above the downtrend before last week and it broke above the choppy consolidation highs too. So Silver has already had a legitimate break out as a buy. I have been saying that the Silver Miners that we bought at the 50sma as laggers should be BUY & HOLD. Why? When Silver takes off, there is a risk that you will be on the sidelines waiting for a pullback that never happens. Take a look at the 2020 box. You really wouldn’t have been able to enter on a pullback then.
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The BULL is on the move and The USD is breaking down again, to seek out that 3 year cycle low. The General Markets, Crypto, and Precious Metals are on the run higher. Last year I pointed out even before that USD drop started that it could drop into Jan of 2024 to find that 3 yr cycle low, so with this only being April, we could have a long way to go and gains in those sector mentioned above. I will review that in the weekend report.
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The weekend report will be out on Sunday, since I have a completely full day on Saturday. Below I want to discuss a couple of other things, and then enjoy your Friday trading and your weekend.
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~ALEX
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YESTERDAY I SAID ABOUT BITCOIN – If the USD fails, Bitcoin might just pause and then continue to run. Here I am pointing out how Bitcoin ‘paused’ for 3 days sideways with 1 red candle at March 15. We could see that here with a failed dcl in the USD, and…
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THIS DOES LOOK VERY SIMILAR:
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BITCOIN PAUSED AND PUSHED HIGHER WITH THE USD DROP: This looks very similar to that first run. Several Crypto stocks doubled and tripled on that move.
MARA was up another 16% yesterday. Mara was also one of those crypto stocks that tripled on that first run, from $3 to $9. It dipped and chopped to $5 and was very hard to hold, but now it is running again, so I called it a buy 2 weeks ago. So far it has moved to almost $12, and this is why I am not “All in” on gold and Silver miners. These move fast!
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When MARA did a 5 wave push higher last year, it ran from $5 to almost $20. That run was when Bitcoin was less bullishly set up, but with the lows in place for Bitcoin, I think that these can continue to run (& CHOP) Higher over time.
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When I saw Bitcoins bullish set up, I was mainly pointing out RIOT, MARA, HUT, etc as buy opportunities. RIOT was a buy both times that it tagged the 13sma, and I posted this as support.
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RIOT was up 9% yesterday, but it has already been running as a leader. RIOT was a buy at all of the points mentioned here and this run has moved it from $5 to $14 in 3 weeks. These are impressive when they run, and scary when they drop. I don’t hold them during the choppy sideways consolidations, but I do re-enter to try to catch these runs.
BITF was lagging riot but it has started and broke out yesterday with increasing volume. I think that crypto stocks are being noticed again. That was a long difficult consolidation, but when they run, they can make fast gains.
CAN is currently lagging a little bit too, but it looks ready to go. Even just a run to Feb highs is a $3 to $4 move.
HUT broke out and looks like a giant inverse H&S.
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THE BIOTECH/MEDICAL/PHARMA area POPPED yesterday, and some of these beaten down companies popped in a BIG way. This is important, because after the pop, we can look for a dip to a ‘higher low’ as a buy for the next move higher ( viewing it as a possible 1-2-3-4-5). Lets take a look.
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IMPORTANT SIDENOTE: This sector started to sell off when I called for a Market sell down into an ICL into late March, early April. This sector did NOT recover when the Banks failed, so this looks like the normal ICL drop that I expected. This drop in many of these stocks is actually what I expected for the General Markets when I called for a low in late march/early April, before the Bank Failure revived it. Bank Failures did not save Biotech, but they may be the next to recover.
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INPX up 128% – That is a huge move and it can continue, especially if there is any short covering.
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INO UP 27% and if it simply runs back to the February highs, it would be a 100% move. I’d like to see a pull back like this…
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I’d like to see a pull back like this to allow us a lower risk entry point. We’ll see how far these run before they stall and pull back. You CAN just buy & hold these lows, but it may be a rough ride and it may be that these now form longer bases too.
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MBIO Up 18% – This ran from $5 to $11, and then it dropped from $11 to $3. It looks like an ICL drop. Again, When the markets started to drop into the ICL, THIS is what I pictured happening. This sector got crushed and could make a nice bounce back over time. This sector did NOT recover when the Banks failed, so this looks like a normal ICL drop for Biotech.
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I am also seeing Uranium Stocks start to bottom. I dont love these all that much, they are choppier and difficult in my opion, but they can make good gains when they run. Lets take a quick look, and you can look up UUUU, NXE, CCJ, UEC, DNN, URG, etc.
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UUUU – This is a bottoming pattern and looks EXACTLY like NXE & CCJ. These have divergence at the lows and look ready to move higher. They are oversold.
CCJ – this is leading the run, but this small base looks just like UUUU above, right? NXE is exactly the same, so this sector looks set to start a move higher.
