Wednesday January 21st – It Happens
I did not have time to proofread for spelling errors yet, please excuse any mistakes 🙂
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I’ve been pointing out that bearish rising wedge possibility. In the weekend report I said that this could break down to the 50sma.
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TRUMP SAID TARIFFS?
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THE SPX lost the 50sma again. Trump mentioned tariffs against 8 countries and the markets apparently did NOT like the news again. Is this bearish? Not necessarily. It could be bearish short term since we are due for a dcl, and I want to add a reminder that…
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Reminder that a daily cycle can actually run up and then return all the back to the lows before making a higher low. I AM NOT SAYING THAT THIS WILL DEFINITELY HAPPEN, but at day 38, we do have time and the circumstances for it, so it is possible.
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THE NASDAQ also broke down below the 50sma, so our triangle breakout that fell back inside has changed into a rising wedge too.
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IWM I drew what a drop could look like here, but that may not happen and the IWM is actually in good shape. I have been pointing out the strength in the IWM and SOXX, so this may be where you want to focus a ‘Buy the dip’ as a dcl arrives. As ugly as the SPX & NASDAQ looked, my account was green with many small caps doing well for most of the day.
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THE SOX: So a dcl comes due, but the IWM & SOXX rallied nicely out of the ICL, so they are not close to breaking that 50sma at this point.
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If I had to guess, I would say that the markets could stay ‘concerned’ and sell down further. I would think that MAYBE the SOXX and IWM go to their 50sma, as the SPX & NASDAQ retest their lows? Just a guess, but I can see that happening if things stay weak.
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UAMY – So as the markets sold off, I pointed out a few stocks that actually looked good. This was captured at noon, and it closed in this area.
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RCAT (Drones) gapped down, but rallied into noon time. RCAT actually did sell off a bit, only closing up 5%, but I’ll take that when the Nasdaq is breaking the 50sma. ONDS was up 8%, UMAC closed green too.
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THESE 3 Quants started to rally red to green, so I pointed them out, BUT they closed red. They are still worth watching, because they’ll probably rally out of the 2nd daily cycle. NOW is the time to start watching for strength during a drop into the dcl.
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That is worth repeating: NOW is the time to start watching stocks on your watchlist for strength during a drop into the dcl.
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WTIC – Oil is at the timing for a half cycle low, around day 23, so we’ll see if it finally has the strength to get above the 200sma again.
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I pointed out this bullish descending wedge last week, and NATGAS popped 25%?? I did not buy that wedge, because Natgas can be quite choppy, but congrats if you did. And BOIL popped 36%!
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The USD dropped and slightly lost the 200sma and 50sma that it has gained, but it started to bounce into the end of the day. It was on day 19 yesterday, but the USD has been tricky. We have seen dcls around day 20ish and also around day 28-30 lately, so that makes this move hard to predict.
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The USD did put in a R.T. daily cycle, and these daily cycles have been choppy, so we could see that choppiness continue.
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The Weekend Report:
Gold seems to want to run to the $5000 area in this new intermediate cycle.
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GOLD LIVE– Gold ran higher Tuesday and this is as of Wednesday morning. This is a big move of $100 and puts Gold in the $4860 area.
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SILVER was up at $94, but I think that this chart is a bit inaccurate, because I saw Silver above $95 and I don’t remember it closing red? So…
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So this is SILVER at 6 a.m. and the candles are getting smaller. We are at $95 and I have had a target for Silver at $97.63. We’ll see if that get’s tagged this week.
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IN THE WEEKEND REPORT:
Step back and look at THE SILVER WEEKLY CHART and it is amazing! What else can we say.? This is not seen as a sustainable move, since it is straight up, but calling a top is tough. It looks like it would be common to run to a nice round number of $100, I have a measured move target of $97.63, but a ‘wiggle’ at this rate could outdo that number.
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THE GDX gapped up and outside of the channel that I had been following. At times you get a gap and go run, other times you get a breakout that falls back inside of the channel. At day 15 for Gold and Silver, this could go either way. Miners looked good yesterday and some of the smaller 5-letter miners are making good moves.
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IAG gappped 15% in the first couple of hrs and closed up in this area. KGC was up 8% and EGO was up 6.5%, so the miners ran and held gains.
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Last month I pointed out GORO, BTG, and NG as laggers if you wanted to buy a stock with a decent stop. GORO had then popped 12%, but…
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GORO has been moving higher and was up 25% yesterday (21% here in the first 2 hrs).
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ASM is a lagger now and has a cup and handle. It actually closed red yesterday! That is a bit puzzling, but it may be a lagger that pushes higher.
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BTG & NG are still a laggers since I mentioned it, but it may be moving now. It closed up over 7% yesterday. NG surprisingly only closed up 3.5%
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In September Tudor was a lagger breaking out, so I posted this buy near 50 cents. What happened next?
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Well, Tudor almost doubled and then started a consolidation that brought it back down to 55 cents above the 200sma. It has been starting to show signs of life, but lagged Gold at new all time highs – until yesterday. A nice 23% pop almost puts it back at the highs. So the smaller Miners are really starting to pop.
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KOOYF has been very choppy, but it popped 13% yesterday. It closed here, but it may be ready to run up and out of that consolidation, as long as the metals do.
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PZG rallied nicely last summer and then started to chop and consolidate those gains. It was very sideways Nov-Dec, and now may be ready to run again.
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So the markets didn’t like the news over the weekend, and since they were within the timing for a dcl dip, we may be seeing that ‘tariff’ news trigger the selling. I expect a ‘buy the dip’ drop. The Precious Metals are simply very bullish. Set ups continue to look good in the bullish sectors, so I feel that we are seeing a buy the dip into a dcl. The dips in the past were brief, some last only 1 or 2 days, others 3 or 4, so I’ll keep an eye on things. Enjoy your Wednesday trading.
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~ALEX
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This is what I wrote on Friday: Day 57
BITCOIN – We are now 57 days out of the capitulation low and that is starting to get late. This trades over the weekend and the holiday on Monday, so you’ll want to keep that in mind is you took a short term trade in Crypto stocks or Bitcoin. I will say that this chart looks like a bullish base, but the time for a good rally seems to be quickly running out – IF that 4 year cycle plays out, and it should.
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For the weekend I said:
The current Daily chart for Bitcoin would have us on the 59th day out of the lows, and often we drop into a dcl around day 60. We did not make it up to the 200sma, so will then next ‘bounce’ out of a dcl get there and THEN we roll over? Maybe, and if so that may look like what I have drawn here. We know that we should be in a weaker 4th year for Bitcoin, and it should sell down into 2026 and then become a strong buy toward the end of the year. That would be a 4 yr low and the beginning of the next run. That could be an exceptional place to get into Crypto stocks, or even before that time.
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BITCOIN – We did get that dcl drop that I mentioned, and it broke down below support. Look for a reversal and we should have a new daily cycle that is possibly a shake out. Crypto stocks actually look good, so this should bounce and they may put in decent gains.
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BITCOIN dropped but CIFR, IREN, WULF, HUT, and others held up well. They did sell off a bit more as the day ended, but with the general markets selling off and bitcoin breaking support, these did remain Bullish. I may trade this sector again for a short period of time.
