Thursday February 13th – A Strong Bull Run

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This is ‘market moving data’, but I don’t usually worry about it too much early in an Intermediate Cycle.  When we come out of an ICL, the market is fresh and has the strength to overcome bad news, but unfortunately, the initial reaction can cause choppiness, and that is what we have been enduring. Today we have the jobless claims and PPI Numbers.

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SPX – Continuous Chop.

 Wednesday gave us the CPI Numbers and The Fed testimony before congress. That initially caused an initial sell off. We had a slightly higher inflation surprise with the CPI number, which started the sell off pre-market.  I have been saying that we should not end this cycle with a day 8 peak out of an ICL. The first daily cycle out of an ICL should have the strength to overcome bad news, and that is what we saw again, as the day went on. Another drop and recovery off of the 50sma.

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THE NASDAQ lost the 50sma and was able to regain it by the close (barely). I see a triangle formation here and I would have to expect a breakout higher, since we are coming out of an ICL. We have PPI numbers and the Job Report on Thursday.

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WTIC – Oil was rallying out of what looks to be a dcl, but it sold off rather sharply yesterday. Notice the RSI too. Oil remains choppy for now.

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THE USD should be in a 4th daily cycle with a day 5 peak. It is day 13.

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THIS HAS BECOME A STRONG BULL RUN!

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GOLD continues to defy gravity, resist a lengthy dip into a dcl, and climbs the 8 ema. It did reverse at the 8 ema with the CPI Inflation numbers coming in hotter than expected. Today we have PPI Numbers being released.

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SILVER broke out, back-tested and also turned upward after the CPI Numbers came in slightly hot. It also turned up at the 20 ema & sma. Silver has been choppy, but it is climbing higher and that should continue over time.

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THIS IS WHAT I SAID YESTERDAY:

GDX bottomed on Dec 31, so it is on day 28 with a day 27 peak.  USUALLY you will see a straight up run to the former highs in October after that downtrend of the wedge is broken, but this will likely dip and then run up to those highs.

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GDX DAY 29 – So recently I have been mentioning how these often run straight back up to the highs, but I expected a dip into a dcl could come first here. Well, the CPI Inflation numbers turned the GDX back up from the 8 ema. We have PPI numbers being released today on day 29.

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EXK and a few other Silver stocks could be considered lagging, but they are also responding to Silvers progress, so a stock like this (barring any bad news or an offering) should also work its way back up to former highs.

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Other stocks like FSM, MAG, and a few other silver stocks are heading to the highs fairly quickly. Things  look good & bullish in the Precious Metals Sector and price does not need to stop at former highs.  It can pause and continue higher and …

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Price does not need to stop at former highs.  It can pause and continue higher, and we have seen price run to new highs with AEM, KGC, AU, etc etc.

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AEM formed a triangle , ran to new highs and kept on running.

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KGC – bullishly chopped sideways when it got up to new highs in January an then just keeps going.

 

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The Bulls remain firmly in control with the Precious Metals, and the General Markets should be able to avoid selling off and should break above the day 8 highs over time too. Enjoy your trading!

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~ALEX

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YESTERDAY:

BITCOIN as been chopping along near the lows and is due for a low to be put in place timewise. So far I do not really see Crypto stocks trying to lead the way higher, but that also may be due to the fact that the General Markets are chopping sideways too.

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BITCOIN could be triangular and day 30 was yesterday. This sideways chop is just brutal when you are waiting for some upside price action.

As of yesterday, I did start to see some upward movement in Crypto stocks as Bitcoin started to move higher. Again, they may be following the General Markets, which gapped down and ran higher too. The Crypto stocks did sell off a bit into the close, so they still bear watching. The ETFs are another option if Bitcoin stops chopping sideways and starts to run higher.