Wednesday March 12th – Watching For The Lows
SPX – We obviously entered the ‘waterfall sell off’ stage, and when this happens the sentiment gets extremely pessimistic, and it seems like the selling will never stop. Eventually, though, the sellers dry up and the shorts start to cover, and then those wanting to buy near the lows jump in and we often get a v-bottom low. At day 39, we are very close to seeing that bottom form. After that low, we’ll see 2 daily cycles and then we have to examine if the markets regained strength or do they look weak.
WTIC – Oil looks ready to bounce, but it would be more of a half cycle bounce, since this 3rd daily cycle is only around day 20 (of 40+).
GOLD moved higher yesterday and appears to be on day 7. It is bouncing along the 34 sma. I am still a little concerned when I look at the MACD and it isn’t turning up with price. That often leads to choppiness, so I’m keeping an eye on it.
SILVER Take a look at the difference between Golds MACD & Silvers MACD after that 7 day push higher. Silver looks good and many Silver stocks did very good yesteday. In fact, EXK had earnings and popped up 24%…
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EXK had earnings and popped up 24% and
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AG was up over 10%, it broke through that resistance area of the 200sma, and many others were up very nicely too. It was a good day for Silver & Silver stocks, despite the general Markets trading in the red.
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GDX was up over 3% and that is a good day during a market sell off too. I’d like to see some follow through to give that MACD a cross upward.
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So far the Precious Metals Sector is the only steady place that I’m comfortable with my ‘buy and hold’ basket. The General markets should be due for a low here at any time, due to the extreme selling that it has, and the cycle count being at almost day 40.
When the General Markets bottom, it is a good time to look through some of your watch lists of formerly bullish stocks to see which, if any, held up better than others. For example, GOOG is well under the 200sma, but other stocks like RR, SOFI, etc are currently holding up at the 200sma. They may put in a good bounce to the 50sma (or more) once we bottom. Speaking of a good bounce…
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Speaking of a good bounce…
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Does anyone want any Lemonade? LMND not only stopped selling with the markets, but it just bounced from $27 to $40 after earnings!! This was a major gainer last year, so I have it on my watchlist and noticed that it is resisting the selling right now, so what will it do when the markets bottom?
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So we’re waiting for the ICL in the General Markets and Bitcoin may be putting in a swing low too, but it is a little too early to know. I’ll discuss that below. Enjoy your Wednesday trading.
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~ALEX
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FROM YESTERDAY MORNING:
BITCOIN DAY 57 Reversal: This is Bitcoin at 6 am Tuesday and as you can see, we do have a reversal candle at day 57 with a new low of $76,600. This has the possibility of becoming the low that I have been looking for, since the timing is very close and I do see a slight divergence in the MACD as price made a new low. I still have to point out as a cautionary note that we might still see Bitcoin bounce and drop one more time to a new low on day 61 for example, but the timing is very close for a low and another drop would likely be short lived.
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BITCOIN DAY 58: The reversal held up so far, but it is still difficult to tell whether or not we have our low in place. Crypto stocks dropped to new lows and then put in a small reversal candle, so we aren’t missing a rally in Crypto stocks yet.
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Crypto stocks like RIOT dropped to new lows and then put in a small reversal candle, so we aren’t missing a rally in Crypto stocks yet.
