March 21st – The Post Fed Reaction
The Fed Speech or Press Conference yesterday was full of talk about inflation being tamed and the possible rate cuts later in the year to avoid having a policy that is so tight that it harms employment. The market reaction was explosive in many sectors and in the sectors that we were expecting a dcl, it seems that we now do have the lows in place following his speech. That doesn’t necessarily mean that we just launch straight up higher from here day after day, but it should mean that we are now starting another run higher out of the lows and more gains are heading our way. Let’s take a look at the charts.
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YESTERDAYS REPORT MENTIONED WITH THE SPX -These markets have been very resilient, and each sell down seems to be met with buyers and Tuesday was no exception. We are due for a dcl, and sometimes they form in stealth manner by forming in a triangle or pennant pattern. If we do get a market dip, it should not last long.
THE SPX broke out. Yesterday I also discussed that I feel that I can see how a DCL could form more clearly with the SOXX, DJIA, etc, so I discussed that…
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So with The SOXX putting in a visible low at day 51, and then pushing higher with the Fed Mtg, we likely have a dcl in place for the General Markets. Also MU, a semiconductor stock, posted earnings and popped 17% after hrs. That might help the markets too.
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WTIC – Oil dropped, but this is still bullish with a day 30 peak. Oil Stocks as seen with the XOP, ignored Oil & pushed higher with the General Markets. Oil may simply do a back test.
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THE USD sold off with the Fed chatter about rate cuts, but this morning it is experiencing a bounce.
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GOLD AND SILVER had a strong reaction higher to the Fed Speech. If you look at the bottom of this chart, you’ll see that the rally really started after the Fed Decision and speech around 2 p.m..
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I SAID THIS YESTERDAY WITH OUR PENNANT AND GOLD AT DAY 24:
Gold is not really dropping, but it has moved below the 10sma. Instead, it looks to be forming a bull flag or bullish pennant. Tuesday was day 24 and a breakout upside through that downtrend line could signal that a stealth dcl is in place and could signal one of those short daily cycles too. In fact, with technical analysis, you buy the break of that apex and place a stop under recent lows, because we can get a false break out too. THIS IS ACTUALLY A VERY TOUGH SET UP ON A FED DAY.
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So I had mentioned that a break of that upper line was a buy.
I then grabbed this chart as the Fed spoke and posted it in the comments. We had a breakout and Gold was at $2181…
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GOLD surged even higher to $2220 and this is a big deal with Gold at all time highs again. People are taking notice and the Miners should benefit from higher profits, so we have been expecting Miners to play catch up and continue to rally.
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SILVER – In recent reports I also mentioned that Silver should be expected to continue higher to prior highs and even with Gold dipping and forming a bull pennant, Silver gave us surge after surge. It is now at those highs and can break out in a big way over time. When Silver starts to move? IT REALLY CAN RUN SWIFTLY. Silver Miners have lagged slightly, but they should really be able to kick it into gear too.
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PLEASE TAKE NOTE OF THIS IF YOU DO NOT OWN ANY SILVER MINERS:
As you’ll see, Many Silver Miners like AG, FSM, SVM, CDE, and more are now all making higher lows at the 20 ema, and that is something that I look for and that is also something that I view as quite a bullish development. Take a look at a few of these charts with the 20ema.
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CDE popped 10% yesterday at the 20 ema.
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SVM popped 12% yesterday at the 20ema.
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IF YOU BOUGHT & HELD YOUR BASKET OF MINERS WHEN IT WAS MENTIONED AT THE ICL, YOU EXPERIENCED SOME VOLATILITY AND CHOP, BUT RIGHT NOW YOU ARE A HAPPY CAMPER! 🙂
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GDX 2:10 p.m. – After the Fed Decision, Miners started to rise up off of the 20ema area. It was up almost 2% at 2:10 p.m. Gold broke from that Pennant, and You still had time to start adding to Miners with a stop in place. GDX was forming a bullish engulfing as long as it closed around here after the Fed Speech…
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I mentioned this in the comments: I feel that all of the Daily Cycle Lows were in place.
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GDX closed up 4%! This was a massive bullish engulfing candle by the close and it even made slightly new highs.
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GDXU was up almost 14% and that would have even made a nice day trade scalp.
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As mentioned, Most of our bullish stocks reversed around the 20 ema area, and that is a bullish run higher. KGC was up almost 5% and…
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IAG was up 4.4%. You can buy them and use that 20ema as a stop. I personally think that these will outperform, and that is why I have focused on HMY, GFI, IAG, EGO, KGC, OR, etc. but what about some of the laggers? I get emails asking about laggers?
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I get emails asking about laggers? Let me just point out that they ‘MIGHT’ start to play catch up, but they also ‘MIGHT’ have more risk. An offering? A day with bad news? Etc, but let’s look at one example of a company that I used to like and it used to do well, but lately has struggled. That is Nova Gold.
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NG released earnings in January and paid the price with a sell off. It MIGHT recover and it does look like that recovery has started, so I might consider buying it, but only if I put it in a basket of Miners. Volume is increasing and it may start to run higher quickly too. Did you notice that IAG was up 4.4%, KGC was up 5%, and yet NG was up 7% yesterday. So yes, Laggers may play catch up, but they do have a bit more risk.
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We saw a very strong reaction to the Feds discussion about rate cuts coming, and that should bode well for things as we move toward those cuts over time in 2024. Buying on a Fed Day can be VERY tricky though. The reaction was very explosive and seems clear to me that we were late enough in the daily cycles and now have dcls in place with the promise of rate cuts ahead. Now depending on what we see for Thursday and Fridays trading – it could even add to that difficulty of taking positions if you do not already have any. Holding a basket was the best idea out of the ICL. Now one needs to add. Next, we could get a day of follow through higher followed by another day higher and another day higher, and THAT is hard to buy. At other times we get a strong pop higher Wednesday and then a few small dips for Thursday and Friday (easier to buy that dip).
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I do not know how this one will play out, but if you didn’t buy or didn’t hold your basket of Miners, this is almost certainly the start of the 2nd run higher out of the ICL. Gold is near all time highs and heading higher, and that should attract attention to the miners. Find a way to buy (start small and add or hold your breath and buy). We are near the 20 ema, and that is a bullish development. I’ll discuss the Bitcoin Pop below, enjoy your Thursday trading!
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~ALEX
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BITCOIN surged on Fed Wednesday and gave us 2 bullish patterns.
1. I see a bullish engulfing and
2. I also see a Railroad Tracks pattern.
That means that our dcl that we were looking for to develop roughly around day 60 may now be in place at day 57.
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BITCOIN 6 a.m. Thursday – Bitcoin dropped a little and then it actually already bounced above the 20 ema. I’d like to see that hold roughly above $66,000 going forward, even if Bitcoin just chops sideways from here for a day or 2 to consolidate gains.
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CLSK – I mentioned that I was going to start watching the crypto stocks for signs that they possibly were leading on the way down, and might start higher on the way up (Joining bitcoins next run, rather than ignoring it like we saw late in the last rally). I posted this on Tuesday…
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CLSK – What a difference a day makes when these DO START to rally with Bitcoin. Also notice that it bottomed before Bitcoin when it dropped and recovered on Tuesday.
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CRYPTO COMMENT – When I mentioned these Crypto-Miners, they were up 15-over 30%.
WULF bottomed Tuesday and was up over 30% with the release of their earnings and a Bitcoin Surge.
HUT started to break out and bottomed a week ago! So I posted this break of a downtrend (Bullish) as it was up 6% and I mentioned that these can gain 10-20%, so it could be viewed as a buy…
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HUT was up 10% in the final hour and was up a total of 18% in after hr trading. That would have been a great buy, even if you sold it for a scalp, but I do think that these are ready to run with Bitcoin. It was $18 in December and that is over 100% higher from here.
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MARA MARCH 19 – I drew this to show the bullish base. I drew it on Tuesday, and then it Popped on Wednesday. MARA Closed at $22.43 on Wednesday, up 16% and may be ready to run again. It has been running to $30 lately, but this chart tells me that the upside could be very exceptional once it gets above $30 again.
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TLRY – Just briefly I will mention again that MJ STOCKS seem to be based out and breaking out. This weekly chart shows nice volume and nice potential. It is a bullish Wege.
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ACB 10:30 a.m. – up 3%, I was saying that you could buy this and make good gains if it has another big day.
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ACB Breaking out- Now up 5% and breaking out.
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ACB was still breaking out as of the close. It held the highs so far.
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CGC gapped open and closed the gap, so it was a buy at the gap fill. CGC then reversed and started to push higher here.
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CGC closed up almost 20%!! These charts look very bullish.
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VFF has been on a tear after releasing earnings.
I will discuss these set ups more in future reports too, along with Gold & Silver Miners and Crypto related stocks.
