Wednesday December 6th
I don’t feel that today data is necessarily a market mover. Tomorrows has been though.
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The SPX continues to churn above the 13sma , which has been acting as support. It is day 29 today, and this can start to weaken as we get closer to the timing for a dcl. I think that the dcl will become a strong buy opportunity, with a first daily cycle showing this kind of strength.
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We can see that the NASDAQ looks to be rounding at the top too, and it should also be coming due soon for a dcl. An open gap and the 50sma is a possible landing area for a dcl, when the selling picks up.
WTIC – Oil slightly broke below the recent lows and I mentioned that I think this could do a complete round trip and land in the area of the June Lows. Oil has tried to rally, but it is weak.
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I just want to mention again the reason that Sundays exhaustion candle is an event that bothers me. I called it an ‘exhaustion reversal candle’ and also a ‘failed break out’, and those often take time to repair. The good news is that even after that reversal, the Miners didn’t just come crashing down, and I’ll discuss that more as time goes on, but those exhaustion type reversal candles often indicate just that–that Gold is now exhausted and needs time to build strength. That would seem to indicate that it cannot reverse higher and break out for a while. I mentioned that I sold some Miners that Monday morning, and said that this is an option for anyone (Sell some or all now to lock in gains, and watch how the 3rd daily cycle develops). I have lightened up to lock in gains on almost all of my miners now, simply because I want to watch how we drop into the next dcl. If this 2nd daily cycle becomes L.T., I may or may not play the bounce on the next daily cycle, expecting it to be the 3rd ‘weaker’ daily cycle. I’m still enjoying Crypto Miners and other bullish set ups in other areas, so I will use my profits on Miners to trade or invest more there. I will explain this further when we get to Gold, Silver, and the Miners.
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The USD climbed up the 20 sma and then on the way down it also found that 20sma as a resistance area. This could be day 4 of a new daily cycle, and with Golds exhaustion move I am watching to see if the USD can put in more than a bounce. We did get a MACD cross, which we have not seen since our break down lower, and that seems concerning too. I was expecting more downside and a L.T. Daily cycle, but this may perk up with Gold exhausted.
I want to start with Golds Big Picture.
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Last week was the first time that Gold didn’t put in a reversal wick at former highs, and I pointed that out here. It meant that Gold closed at all time highs on a Daily, Weekly, and Monthly basis. Very bullish really. I think you know what I am going to point out next?
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This week Gold is selling down below those all-time highs now, so if this selling continues without a bounce, we will actually see what I was celebrating last week disappear. We will have a reversal/rejection at all-time highs. This does concern me. It doesn’t make it impossible for the 3rd daily cycle to start to run back up toward those highs, but more selling into a dcl makes that climb less likely. So like I said yesterday…
THIS IS WHAT I SAID YESTERDAY ABOUT THE POSSIBILITY OF GOLD CONTINUING TO DROP TO OVER 30 DAYS:
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That gives us a L.T. 2nd daily cycle. We would then expect the 3rd daily cycle to be unable to make new highs. It may chop around and bounce up to the trendline or bounce around as drawn here, but that would be another place to sell (maybe even buy JDST or DUST for those desiring to). A H&S could form with the 3rd daily cycle. And…
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THIS WOULD THEN BE THE WEEKLY CHART BAD NEWS ALSO POSTED IN YESTERDAYS REPORT:
That reversal becomes the ‘peak’ of this Intermediate Cycle on daily cycle 2, and the 3rd and 4th daily cycle make lower highs and eventually lower lows that drop into the next ICL. We have to face that as a real possibility. An higher ICL that comes in 2024 would then be the next best chance for Gold to break out.
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Gold has a day 15 peak, using ‘Spot Gold’. Today would be day 17, and I’d like to see a bounce soon to give us an a-b-c drop and keep Gold from just crashing straight down.
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SILVER dropped sharply on Monday and the selling continued on Tuesday, but I will say that Silver stocks have not been crashing down like they normally would. That was rather surprising, and I’ll point that out later.
SILVER – It would be nice to see a bounce here too, to slow things down. Look at this drop in silver though, compared to the next chart of SILJ (Silver Miners).
SILJ- Silver stocks are not dropping as quickly as Silver itself, but it did lose the 200sma and you can see that it can drop much further to reach the 50sma. This is why I started selling my miners Monday and Tuesday.
The GDX dropped to and bounced at the 200sma, but it remains overbought.
And then I wanted to show how the Miners are doing. I was kind of surprised to see many of them holding up the way they are, so let’s take a look.
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KGC is actually still up near the highs of this intermediate cycle, with a reversal on Monday and one on Tuesday. It seems like someone is buying the dips.
NEM – Newmont tagged the 200sma and is doing a normal crawl under that area. Yesterday it dropped to the 8 ema and bounced, so at this point selling seems tame with many Miners.
BARRICK – On Monday I mentioned the late day bounce in Barrick, saying that selling seemed rather light following a large exhaustion candle in Gold. Did selling ramp up Tuesday?…
BARRICK -Barrick dropped and bounced again, not even tagging the 9sma, so with a stop I wouldn’t even be stopped out 2 days after large reversal candle in Gold.
We saw how sharply Silver dropped on Monday and Tuesday, but CDE dropped to the 200sma and then bounced.
FSM rallied sharply in October through November and it is basically still up at the highs. It dropped to the 13sma and bounced into the end of the day.
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The General Markets have been churning sideways and remain quite bullish. They can push higher, but a dcl will be coming due soon and that should offer a nice ‘buy the dip’ opportunity for those stocks or TQQQ, SOXL, SPXL, etc. Oil remains weak and I am not interested in that sector right now. The USD is bouncing and Gold has a large reversal candle at all-time highs. Many Miners have been holding up rather well, but I had to ask myself, “Can that continue if Gold and Silver start to sell off into the next dcl?” I just don’t think they can hold up under that pressure, so I lightened up on Monday and even sold off almost all of my basket at this point, and I will reassess at the dcl. If the 2nd daily cycle was R.T., the 3rd could rally strongly again and break out, but often an exhaustion candles take time to repair. Crypto stocks rallied again yesterday and Bitcoin/ Crypto has been on a tear! This basket of Crypto Miners has done exceptionally well, and these will be a buy the dip for sure at the next dcl. We still have great opportunities to take and make money, and again, a future dip in Cryto-Miners like RIOT, MARA, CLSK, BTBT, BITF, BKKT, etc etc should offer very strong gains in 2024. I am expecting Bitcoin to rally to new all time highs there too, and those Miners are rocket ships when that happens. I will of course discuss that more in future reports, along with General Market stocks at the next dcl. Enjoy your Wednesday trading!
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~ALEX
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Yesterday I discussed the continuation of Bitcoins rally. After a 30 day dip and a day 65 dcl, we were on day 20 of 60. Will this dip into day 30 sharply(?), or mildly? Will it just chop sideways? I had an initial target of 34,000-36,000 and resistance…
I had an initial target of 34,000-36,000 and resistance, but as it broke out on this weekly chart, the next target area is roughly 44-48,000, seen on my next chart. This has been a very strong run and crypto stocks are doing exceptional.
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The next target area is roughly $44,000-$48,000, seen on this chart. This has been a very strong run and crypto stocks are doing exceptional. We had a Pop, a running correction, and now the 2nd Pop. The next drop into a dcl or ICL will be a huge buying opportunity.
