Tuesday December 16th – More Data To Come
Data that was delayed due to the government shut down is due to be released this morning, so we’ll see what the futures do after 8:30 am ET.
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THE SPX: The general markets gapped open higher and then when they dropped to fill the gap they just continued to sell off lower, reaching that blue 20 ema again. Take a look at August, September, and October and you’ll see that these pullbacks do happen in Bull markets, so if we lose the 20 ema, it isn’t necessarily bearish.
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SPX – I wanted to point out that this still looks similar to the run higher in 2024. That was NOT a deep ICL in April 2024 (blue vertical line), it was very similar to now.
1. That ICL in April 2024 lost the 50sma, did not tag the 200sma, and moved back to the highs. We did that now too.
2. Price THEN dropped to the red 50sma, so we might even see that now and it would still be very similar to the April 2024 ICL.
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Now let me show you an even deeper drop after an ICL that we saw with The NASDAQ:
1. That drop did NOT tag the 200sma, but it did break the red 50sma and crawled along under it.
2. Prive rallied up to day 15 and then take a look at what it did. It dropped all the way below the 50sma again, and you could say that it re-tested the lows (ICL).
3. This was 2021, so I don’t remember what we were thinking at that time, but then the markets reversed and rallied higher after day 29. We are currently on day 15. So…
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So what is my point in showing this? This is a lesson for me and for you.
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At that time, we had the Covid Crash ICL in March and a STRONG rally followed. A V-Bottom rally that rallied for months. In 2025, we just came out of a ‘tariff induced / inflation type of an ICL crash’ last April. After the big crash, we also V-Bottomed and rallied strongly. The NEXT ICL was more choppy in that first daily cycle. I don’t know if that is going to happen again here, but I want to prepare us mentally for anything.
This second drop below the 50sma would have stopped me out as I looked for a higher low at the 50sma, but the recovery was sharp and the rally continued- so we found a way to get back in. The Bull was running again (I do remember that Solar, Clean Energy, MJ, and EV Cars were all the rave in 2020, but started to sell off in 2021) so we continued to find bullish set ups in other areas too and made money after the first daily cycle.
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THE USD was rejected at the 200sma, and even though it was showing signs of strength out of the September lows, when the rate cut in December possibility was discussed in November, The USD weakened and Gold strengthened. Now the USD has returned to a downtrend. In fact…
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When I pull all of the moving averages out USD chart, you can see that we have a failed daily cycle -or- a lower low, so it has started to trend lower and will drop into an ICL eventually. That should help precious metals. This is when we see if THAT low is a lower low too.
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GOLD broke from a triangle and is back near prior highs. Silver broke out and ran quickly higher, but it did not run when Gold broke out and ran. It is possible that Gold continues to consolidate. That DID happen in June/ July. Gold ran to the highs and then it just continued to consolidate sideways for a little while. It is a Bullish set up, we just need to wait and see how it plays out. The good news is this…
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The good news is this: If this was a parabolic blow off top, it probably would be selling off by now, and instead it is showing strength up at the highs and consolidating those last gains. So, it remains a bullish set up.
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SILVER has been on a bullish tear. It surged about $2 again on Sunday night-Monday (3%), but sadly many of the silver stocks did not follow. Some did; some didn’t. This could simply be cycle-timing for those stocks.
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AG – For example, I think that AG should have pushed a lot higher, maybe up 7-10 % when Silver is up 3%, but it gapped up and then dropped. It closed up 10 cents. MAYBE that is because it is on day 27 and will tag that 20ema before running again? I just don’t know, but I was surprised to see Silver up 3% and AG up 10 cents.
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FSM gapped up higher and then sold off, closing down 20 cents. Again, I don’t know why, but it seemed to follow the general markets and not Silver. It is a bullish chart of a cup and handle, but I want to see price move higher soon.
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PAAS also gapped higher and then sold off to down 39 cents. $32 to $52 is nothing to complain about, from the November lows, but it was surprising to see this in many silver stocks. They may just be running at their own pace.
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GDX: This was in the weekend report, and I just want to point out that this is a bullish looking set up. I’m pointing this out again, because it too dropped on Monday…
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GDX – Gold & Silver were up and Miners were down, but again, maybe this is just dropping to the blue 20ema, similar to what it did on the last bull run. Another way to look at this could be…
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Another way to look at this could be that is runs straight up for several days (green line) and then consolidates sideways for over a week. I do see that repeatedly. Once it breaks to new highs, it could then rally in a stronger manner, like we saw on the left side July-October.
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Monday was a pullback Monday. The charts aren’t damaged in any way, in fact, pullbacks can lead to buy the dip set ups if stocks fall to support and reverse. We have quite a bit of ‘Data’ released this morning at 8:30 a.m. ET, so we’ll see if that changes anything bullishly short term, or if it causes more selling. I do hear of ‘concerns’ with the economy, but we’ve had that all throughout this bull run, right? Concerns of inflation, higher costs & lower profits for companies, etc, and the markets continued to climb a wall of worry. With talk of more interest rate cuts in 2026, that can continue. We’ll see how things play out and see how the futures react to the data release at 8:30. Enjoy your Tuesday trading!
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~ALEX
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BITCOIN is choppy and struggling to gain traction out of that low. Can it get above the 50sma and that downtrend line? We’ll see, but the Crypto stocks are starting to get ugly or more bearish looking while we wait.
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CIFR lost the 50sma again and the RSI & MACD are weakening. Bitcoin looks ready to bounce today, so this may bounce, but it may just back test that 50sma and then roll over again. It’s a pretty clear head and shoulders.
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WULF held up better, since it was at the highs last week, but when these sell off, they do crash down quickly.
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HUT is starting to see higher volume selling than buying and has weakness in the indicators too. Notice on the last 2 moves higher, it takes 5 days up and only 2 days to erase those gains. That is a “Sell the bounce’ signal if you ask me.
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