Wednesday March 25th – Weaker Bounces?

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SPX – I’m just pointing out the number of days that the markets bounced out of the dips. On the left bull side, we often got 5 or 6 days higher out of the low with a bullish bounce. Lately we get 1 or 2 days out of a dip & it rolls over. I do think that when we have the dcl in place (& we might now) We’ll get maybe 5-7 days higher before it rolls over. It would be a weaker bounce though.

 

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THE IWM has bounced out of day 30 and even though it gapped down on Tuesday, it closed green, so we do have 2 green days out of the low on the IWM.

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WTIC – Oil dropped on Monday when a ‘5-day pause’ in the Iran war was announced. This could become a half cycle low if Oil resumes the upward run after this 5 day pause ends.

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I expected the USD to drop lower after hitting resistance, and so far, that is what we are seeing. I was thinking that it may rest on the green or red support near $98.

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I discussed that GOLD was on day 35, and that is time for a dcl. I also discussed that it broke down below our prior Feb low, and that usually will NOT happen in a first daily cycle out of an ICL. THAT MEANS…that this might now become a final daily cycle, not a first daily cycle.

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I also discussed that Gold could have this as the A-B-C move into an ICL on a 4th daily cycle. NOTE: It could also give us a bounce and crash like the Nasdaq Tech Bubble did, into a 5th daily cycle. The Naz bubble also double topped like Gold with a double top, and then crashed.

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So GOLD reversed at the 200sma and it was due for a dcl at that time, so it is likely that we have a dcl here. Gold can bounce higher, but the bounces may be weaker than they used to be.

 

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SILVER was due for a dcl and we likely have one in place here too, syncing up Gold and Silvers cycle count. Silver can also bounce, but I would expect weaker bounces.

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SILVER – This could be a large A-B-C down to give us an ICL, and if so, we’d likely see a consolidation phase where Silver chops sideways and higher before selling off again.

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GDX is chopping sideways after gapping down. A gap open leaves behind an Island Bottom, which is usually at least short term bullish.

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  The General Markets are due for a dcl / bounce, and the so called 5-day cease fire would be the perfect time to get a short-term bounce that rolls over later. Since we have a failed intermediate cycle, where the lows were broken last week, this should be a short-term bounce and then roll over again. It might offer a ‘shorting’ possibility, but the choppiness lately has made going long or short difficult.

 Oil exploded higher with the Iran war, since that has affected the Strait of Hormuz and tightened Oil supplies. It seemed to have put in place a blow off top rather quickly, but Oil stocks have climbed steadily, and Oil can still continue to chop sideways or higher over time. Oil stocks have been in an uptrend.

 When the markets sell off like Gold and Silver just did, they do eventually find a low (dcl or ICL) and then they begin to bounce higher again. It can look bullish and start to make one think that the lows are in and we are about to rally to new highs, but if we had a blow off top, those highs will be in place for quite a while. I think that is where we are now. I even showed yesterday how much Gold resembles the Nasdaq  blow-off top (2000 Tech bubble) with these 2 charts.

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 Scroll up and down and look at the similarities of the Nasdaq top & drop and Golds recent top & drop.

If Gold selling played out in a similar manner as the Nasdaq sell off, the bounce would be short lived. Right now, the set ups look weak and choppy and they seem to want to bounce and then roll over into a deeper sell off.

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 With the general markets, I have been mentioning that in a market that is bouncing and then finding deeper lows (a gradual sell off into an ICL) , sitting in cash and waiting for that low is often a good option. Why? If we get a deeper sell off into an ICL, it can offer a great buying opportunity like we saw last April in 2025. I have also discussed looking at which sector or stocks hold up better during the selling, and I have a list now that could eventually drop lower and offer a great buying opportunity at an ICL. If you are trading (I traded RCAT, ONDS, UAMY, etc for small bounces) don’t marry the stock, because they can sell off later.  A day trader may take 1000 shares of a stock that goes up $1 and make $1000, or 2000 shares of a stock going from $13 to $14 or $15 and make money, but timing is important and being in front of the computer is key too. These can also drop $1 or $2, and you’d lose $1000 without a proper entry or stop. If you can’t babysit a ‘day trade’, then cash is king.   These markets also allow you time to leave during the day and get a few things done until they bottom and offer great buy and hold positions. Do your taxes? Rake the yard? Prepare a garden?  Invest at the ICL. It’s up to you how you play it, but it is good to stay tuned and watch for changes along the way. I cover that in my daily reports. Enjoy your Wednesday trading.

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~ALEX

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BITCOIN is churning along sideways, and time is getting late now. I have been mentioning for weeks that I think that Bitcoin will bounce and consolidate similar to the Nov to Jan churn, but then sell off again when the general markets sell off too. I have also mentioned that we should get a GREAT buying opportunity in 2026 for the Crypto sector, and some stocks are holding up better than others.