Friday January 5th – Unemployment Report
Todays Data is The Unemployment Report and we have seen that move markets in the past, but in which direction? Both. At this point we are dropping down into a dcl, and it is late enough to mark a dcl at any time, so will this report reverse the markets and cause a rally to begin? Or will it cause the drop to continue? Either could happen when we look at the charts, so let’s do that now…
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#1 The SPX is at the late side of a daily cycle on day 46, but notice that the stochastics is not oversold yet. This means that the selling can continue…
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#2 The SPX – So this can drop further, possibly down to the 34 sma or 50 sma, as a back test of that breakout. A reversal and close above the 10sma is usually the signal that we look for when looking for a dcl after a swing low.
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WTIC – Oil is on day 14, but it still has that frustrating choppy price action. It is struggling at a downtrend line and I probably could raise that upper downtrend line to the top of yesterdays price too.
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1. THE XOP broke out from a wedge and was then riding above the 34 sma.
2. It looked pretty good, so I took a position (in Gush).
3. The XOP & GUSH started to drop on Thursday and sold down all morning, so I decided to sell it for a loss. I actually went in rather heavy with it above that 34 sma, so it was a bigger loss than I usually allow.
4. Didn’t I say that I wasn’t interested in trading this sector? 🙂
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I know that this timestamp says Jan 5, 8:40 a.m., but it was 5 am when I grabbed this chart.
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The USD is pushing higher and if this continues, it will begin to resemble another ICL and not just a dcl.
It looks strong and if this rally continues, this would be a higher low or higher ICL. That means that we did see the 3 yr cycle low early, as mentioned when I saw that July – Sept rally unfolding. This would likely be due to the Fed Rapid Rate Hikes.
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GOLD is holding up rather well with that USD rally, it is still above the 34 & 50sma, but you can see that Gold is under pressure. The MACD is showing weakness and it may just continue to be choppy until it drops into the next dcl.
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SILVER dropped and started to bounce back just before almost breaking below the last dcl. A break of that low starts the failure that ends the uptrend and starts down trending price action.
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GDX still has a series of higher lows, but i do expect this to remain choppy and roll over in time. Right now price is between the 50 & 200sma.
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I have done some trading in Biotech stocks and Gush this week, but nothing too heavy, since various ‘set ups’ can be tricky or weak when we are searching out a dcl. Yesterday Gush robbed my piggy bank too. Today is Friday and I am actually planning on leaving later for most of the day, mainly all in cash while waiting for that DCL in the General Markets. We have a storm coming to New England Saturday night and through Sunday with a foot of snow possible. I want to go and help out my parents with a few last minute areas of prep work.
If you are trading, you also may want to just keep positions small until we get a dcl in the General Markets. Some Biotech and Crypto stocks did well yesterday, others were choppy intraday. MARA actually looks surprisingly nice! I will discuss that below, because with a dip due in Bitcoin still possibly ahead, caution is still warranted. I do want to be patient and see what kind of a pullback we can get in some of those crypto stocks. They surely can drop quickly when they pull back. The weekend report will probably be out on Sunday again. Enjoy your Friday trading!
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~ALEX
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BITCOIN is on day 52 today and the sideways consolidation has continued. This could still break out, but we usually see a dip into the day 60 timeframe, so whether or not this will break out and get to $48,000 before that dip remains unknown. It may be less likely the more time nears day 60.
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MARA is one of the better looking Crypto stocks with a nice 2 day bounce, but is this a recovery? Well, if Bitcoin dips into day 60, Mara will likely dip too. In fact, I warned of this kind of price action in the next chart…
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MARA – I drew in this bounce and then a drop on Dec 29, to help us to ‘Stay Frosty‘ and use stops if we play the bounce. Could it really bounce this nicely and then crash back down? Yes. Do you remember…
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MARA – Does anyone remember when I showed what Mara did in 2021? It was a very similar looking bounce as the one that we are seeing today, but it just fell apart, so use stops and ‘Stay Frosty‘, my friends! This may or may not repeat, but seeing how it happened in the past is helpful.
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I’ve been trading some Biotech Stocks and some of them look better than others for the long term, maybe as a buy and hold(?).
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TGTX is one that impressed me, so I just wanted to point it out here.
1. After an earnings crash in August, it based out and started to rise up in November with the next earnings report. It gapped higher.
2. It basically ran from $7 to $19 in the last 2 months and has now pulled back to a possible support area of the 20 ema.
3. Their next earnings report is Feb 27. You may want to be out of it by then 🙂
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SEER is another one on my recent watchlist that is interesting looking (I think that ED mentioned this in the comments). I like the base and now it may be starting to make some progress, as it builds the right side of a rounding bottom? If it can continue higher, it has good upside potential. I don’t own it, because it is just now moving above the 20 ema, but I may take a position over time.
