Friday August 9th – Ready For a Bounce?
WE HAVE A NO DATA SCHEDULED ON FRIDAY, so we’ll see if the markets can take advantage of that and continue yesterdays bounce. Let’s see the charts…
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THE SOXX was bouncing higher yesterday, so midday I took a look and tried a cycle count. The day 45 is where I felt a dcl came in, because THAT is where the 10sma bent lower, so I marked 29 as a half cycle low. Now at day 28, we could have another half cycle low here, and the bounce MIGHT be a little more than that blue 10sma.
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The other idea was just that we could also have a shorter daily cycle, because of the crash. Sometimes the selling exhausts for a small period of time, so is this a capitulation dcl? EVEN IF IT IS A DCL, the bounce will be deceitful, because this Intermediate Cycle has failed and it will sell off lower.
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So if we have a dcl, that dcl for The SOXX might be this convincing. The price could push as high as the 50sma, which has curled bearishly lower now.
1. We could see a bounce that Tags the 50sma
2. Sell off again, maybe right through the 200sma
3. We should actually break those Aug lows.
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WTIC – Oil appears to have done a mini ‘shakeout’ at day 42. That is enough time to give us a dcl and it was just in time to prevent a L.T. Daily cycle.
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GOLD was up $31 yesterday. I kind of thought that we’d fill that gap right at the 50sma, but then I remembered what I said earlier in the week. I mentioned that..
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Earlier in the week I mentioned that GOLD might not need to fill that gap, because it DID already go there premarket, as seen on this spot Gold chart on day 6. NOTE: Gold continued to look Bullish throughout the entire market sell off. It is just in a long consolidation, hopefully preparing to breakout to new all-time highs again.
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SILVER put in a lower low yesterday and then made a nice run 2.5% higher. We are in the timing for a dcl and even an ICL, so I am keeping an eye on the Silver Miners now too. Silver miners like EXK, CDE, and AG got crushed in that market sell off, so they may be difficult to trust.
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Silver miners like EXK, CDE, and AG got crushed in that market sell off, so they may be difficult to trust. If they just put in an ICL and they recover, however, they could do well.
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HL sold off to the 200sma and appears to have done a shakeout, but they released earnings and have recovered. You could buy with a stop if you feel that Silver may have finally bottomed.
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The GDX has a day 33 low, so we should be on day 3.
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I just wanted to point out AU (and even AEM, HMY and a few other Gold stocks). These sold off, but are recovering quickly.
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AEM already released earnings and 4 days ago it tagged the 50sma and is back up near the highs. That’s a bullish chart despite the Market sell off.
HMY is chopping around the 50sma. With a series of higher lows, it remains bullish too, but this has been a bit of a sloppy consolidation.
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So the General Markets may put in a convincing bounce, but they have failed daily cycles and we need to remember that they will drop again. When the SOXX failed I mentioned that the general markets should sell off, but the SPX & NASDAQ looked fine, didn’t they? …until last week 1 day after The Fed Mtg. WOW did that change fast? It came out of nowhere, so I want to just keep that in mind, since I expect it again in the near future.
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So we may get a bounce, but stay frosty my friends. As for Gold & Silver, Gold held up well during the markets selling and Silver was due for a dip into an ICL anyway, so with that out of the way, this sector could rally, we’ll see. I would say that you can buy Miners with reasonable stops. What about Bitcoin? It is acting correctly, I’ll have that below. Enjoy your Friday trading and enjoy your weekend!
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~ALEX
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Earlier in the week I said that I expect a low around day 31 . Day 31 broke below the ICL, so honestly I still have to expect another low like the pink path for a final low, but I just wanted to point out a very small possibility that we get an anomaly recovery to. We then were just waiting for the bounce to kick in…
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The Bitcoin bounce has definitely kicked in after that day 31 exhaustion reversal. Crypto Stocks actually did push higher yesterday too, some as much as 15-20%, HOWEVER that was with the General Markets rising too. It’s still an unknown as to how they will act when the markets drop. Please use and raise stops if you trade this area. The BITCOIN ETFS that I have mentioned are doing well too.
