Thursday Aug 1st – Post Fed Action
THE FED DECISION AND SPEECH SEEMS TO HAVE TAKEN PLACE AS EXPECTED- BULLISHLY!
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SPX – Should I short this Pop? No, I don’t think that it is time to go short yet, but I do think that this will probably roll over sooner than later. Let’s let this play out a bit, and I’ll explain that thought with the next couple of charts…
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We just went from a somewhat bearish drop to an oversold hopeful “The Fed is cutting rates soon” Pop, with the SPX. We broke a downtrend line and closed above the 10sma, so it may be wise to allow it to play out for a little while. I want to see if it is choppy as drawn, or strong, or weak. And…
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THE NASDAQ is also quite oversold (Stochastics), so a good bounce could follow. I want to let it play out, because it might go as far as to back test the uptrend line.
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And then we have The SOXX.
It closed above the 10sma on a 7% pop, so let’s allow this to play out and see where it goes from here. It may start to bump against and stall at the 50sma, or it could possibly even make a run for that uptrend line ( I doubt it though), but it is very oversold and let’s allow it to bounce.
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Do you remember when Oil dropped yesterday and Oil Stocks did not follow? That happened even with the markets were selling off! Well, that helped us to see that Oil was fine, it was just doing a round trip and would put in a higher low.
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WTIC – Look at that surge with Oil. I think that we have our higher low at day 38 and that could actually be a dcl, so we just want to respect the price action. Oil stocks were already declared bullish, so those are expected to continue higher over time too.
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IN Tuesdays REPORT I MENTIONED THIS:
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GOLD is within the timing for a dcl at day 33, and this very well could be a dcl in place at the 50sma right before the Fed mtg. (This would be day 2).
GOLD then started to break out from a downtrend and above the 10sma yesterday during market hours, so I posted this. (This would be day 3). We now have a swing low in place and this should be the dcl.
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GOLD has continued higher and this is Post-Fed Gold, with a strong day 4 surge. Will this just take off higher or could it dip lower before a launch? It could do either short term, and I’ll answer that with the GDX chart.
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SILVER should only be on day 2, and this is a Post-Fed bullish reaction and the time is right for a dcl (ICL?).
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1 hour into trading, I posted this chart of GDX to show the gap open.
I mentioned that seeing a gap fill to the 10sma and reverse would offer a great entry (if you didn’t buy when I mentioned it in Tuesdays report). On this chart, I was actually pointing out that past gaps filled the following day, so THAT could also have happened this time too. See the Blue & Majenta markings.
GDX – Later in the day, the GDX ETF did dip lower and partially gap fill, so this may be enough.
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HL – With Silver likely on day 2, some of the Silver stocks re starting to push higher. HL reversed at the 50sma line.
YESTERDAY I SAID ABOUT EXK:
Here I just want to show you what I noticed about Past EXK Earnings. Each time EXK had pre-market earnings release, it rallied 15-21% that day. EXK has earnings due out on Thursday. Could it be different this time & sell off? Of course, but from what I see here, this might be a good time to buy some EXK if you don’t already own some. I expected a tag of the 50sma on Fed Wednesday, but again, EXK did not sell off like Silver did either.
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EXK is at a downtrend line and it does have earnings scheduled to be released in Pre-market, so we’ll see how THAT goes today. If EXK sells off this time, the 50sma still may act as support and I’d watch for a reversal there as a possible entry point.
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So the Fed Mtg was encouraging and the initial reaction was bullish for the General Markets and the Precious Metals, but now we just have to wait and see what the next day brings. Sometimes we get the opposite reaction on the Thursday after the Fed Mtg and from there things settle down and continue on the path that they will carve out going forward. In other words, if Gold and Silver do pull back today, it shouldn’t be very concerning with the cycle count as late as it is at this time. It may even drop in the morning & reverse higher by the close. We’ll see. Bitcoin was due for a little dip into the day 30ish area as a half cycle low. Did that happen? I’ll discuss Bitcoin below. Enjoy your Thursday trading.
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~ALEX
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BITCOIN FROM THE WEDNESDAY REPORT:
This is what we got on Tuesday…no change really. I have drawn a possible dip into day 30ish and then another move higher, but so far Bitcoin has become choppy at the resistance of prior highs. I watch this and the stocks every day and will report anything interesting that I find, but yesterday was a nothing day heading into the fed.
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BITCOIN did drop post-Fed and so we have a new recent low at day 27. I wouldn’t be surprised if we break below day 20 for our mid-point half cycle low and then look for a reversal. Day 27, 28, 29, or 30 is close enough to me. 🙂 Crypto stocks…
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Crypto stocks actually started to look a little better intraday yesterday during morning trading, but then they weakened and sold off as we were heading into the Fed Mtg. Suddenly they rallied with the Fed & his speech, but then they sold off into the final hour again, closing at the lows. So it was interesting to watch, but they still look like they need more time.
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This was MARA.
1. It chopped to a new daily high at noon,
2. then it sold off into the Fed.
3. Suddenly a strong rally emerged out of the days lows with the Fed decision and speech,
4. but the final hour saw a sell off to new daily lows. Choppy and ugly intraday price action, but on a daily chart?…
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On a daily chart MARA simply tagged the 50sma with that intraday rally, was rejected there, and closed at the lows. It looks like it wants to drop to the 200sma.
