Frustrating

If you have been trading certain Biotech stocks, the markets have been exciting, but if you’re watching for a directional move in many other areas? Its been a little boring, maybe a little frustrating. Lets look at the charts…

SPX – Sideways for most of 2015 really.  Frustrating for many.  Give me a break (out or down please) 🙂

The NASDAQ is overbought , but it can stay that way if it breaks out.  It too has been sideways and Frustrating.  This set up is more bearish as a rising wedge that we have watched form since Feb . A clue that it is more bearish than bullish is…

The VIX  –  It shows complacency and is near lows.  When it bounces , the markets correct.  Notice the October & early December bounces in the VIX and then look at our SPX or NAZ Chart above for Oct & Early Dec

A chart From the weekend report-  It is not time yet,  but If the markets do give it up and start dropping you can go short. If you are uncomfortable shorting, there are inverse ETF’s like TZA, SDS, SQQQ that you can go long and make the trade.  These are leveraged so please know the risks if this trade goes against you , losses can add up fast.

It needs to be noted-  SOX broke out as pointed out here last week and has had follow through. This just adds confusion to the mix if you are bearish SPX and DJIA , but it safely keeps us from shorting other areas early in case this becomes a leader and others eventually follow.

The USD–  The dollar recovered the 50sma and has had a bullish move higher.  Watch $96.77 / the 50sma for support.   I am not an Elliot Wave guy, but I do see 1-2-3-4-5 patterns and A-B-C corrections etc all the time.   If the Dollar hit the blue line now, then maybe you’ll see Gold drop further into a Daily cycle low.  The dollar could then pull back allowing Gold to move higher. Lets look at Gold…

GOLD- Sideways and Frustrating LONGS & SHORTS for weeks .  Day 18 could have been an early DCL, but this looks weak.   If the USD moves higher, I would love to see Gold go sideways & drop below day 18, but hold above $1168.40.  This could give us a daily cycle low in the 20’s count.  GOLD is in an oversold area.

SILVER– for 2 weeks the Silver COT shows commercial Smart Money  very short silver.  Silver  remains above support & the 50sma.  I dont like to bet against Smart Money, but if Silver holds up and goes higher it could cause a great short cover rally.  We are only in a second daily cycle so The Cycle Timing doesnt really agree with that unless we are in for a huge bullish surprise  (Unlikely, but possible).   There could be many weeks of downside if this breaks down.   Right now Silver has Higher Lows since December, it is strong and could go sideways for a while too, so I wouldn’t short it until it breaks down.  If SILVER & MINERS lead,  they have shown strength.

GDX-  Monday price gapped up, filled a gap from last week, and reversed lower.   Frustrating .  This looks bearish as an engulfing candle.  These markets are sideways and frustrating so far, so I’m happier on the sideline for now as things play out. GDX gained & lost the 50sma yesterday.

WTIC –  A bullish chart.  I mentioned that I bought UWTI last week.   If you are trading OIL with UCO, USO, UWTI or another method, things look good . If you are using Energy stocks or  XLE/OIH?   Frustrating.  It has been disappointing since they aren’t following OILS lead yet.  I got 3 emails asking me why, and I cant say why.  I definitely thought that the energy stocks would follow OIL in a second leg up.  The move in Oil looks real. Does that mean that OIL is not going to follow through?  Is oil heading down One more time to the 50sma?  Are energy stocks just waiting for OIL to  break to new highs?   When these questions arise all we can do is stay alert and trade accordingly.

XLE-    This still looks bullish and is oversold.  IT should move higher today !  It is a normal healthy pullback.  Note: Sometimes MINERS dont move when the move in Gold isnt “real”.  Are Energy stocks saying that OILs move isn’t quite “Real” yet, and  will pull back 1 more time to the 50sma?  Or are they waiting for OIL to make new highs before joining in?  I dont know , but if you own USO, UCO, UWTI- keep alert to that idea.

NATGAS–  I have mentioned that NATGAS needed to pull back further and we are in the area that I was looking at last week.  We also saw a reversal yesterday, so some could buy here with a tight stop or wait for a break back above the 50sma with a tight stop there.  I dont like to recommend 3X ETFs, because there is added risk & you each have your own risk levels. NATGAS/ oil  stocks like XCO & UPL ( some trade UNG) may react well after their recent pullbacks.  ( Leveraged ETFS are  UGAZ, BOIL, etc)

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So really,  its a mixed bag of information.   Whip-Saw action is relentless and Suddent Rallies, then sudden drops add risk to most trades. Certain areas need more time to clarify the picture.  There are so many sideways markets that the future direction is hazy.  The SOX breaks out higher while other sectors have bearish wedges and the VIX is at lows that usually cause a pull back.  Will the Sox  break out eventually fail or is it leading?  CY, TSEM, and a few others dont look bullish or bearish.  Frustrating . Oil turns higher almost exactly where we expected ( above the 50sma) and looks very good, but Energy stocks are not responding .  Will OIL make 1 more drop to tag the 50sma? Are energy stocks just waiting for new highs in Oil?    Gold has been sideways for weeks if not months, and some MINERS look bullish, others are at lows.   Another mixed bag, but I dont like the set up here for longs.  The COT is bearish and there is still time for more downside.  THAT downside could also cause a failed daily cycle if it drops too much.   BIOTECH STOCKS are breaking out everywhere.  I have a long list ( I dont own any since selling the pop in MNKD).    Is basically only own stocks that I bought much lower  (BAA, GSS,) and PLUG, REN,  UWTI, and I added UGAZ last wk at these lows). I am basically in trader mode & may enter the sidelines when I finish a few of these trades.  There are ALWAYS good opportunities lining up for the patient traders.

  For now I want to release this  so it can be read at least an hour before the open.  I will add some BIOTECH BULLISH looking charts while you all are reading this .  Check back *(refresh) in a while or you can look in the comments section.  I will write in the comments section to let all know when I am done adding charts.  Thank  you all for being here!

~ALEX

 I just want to add a couple of charts that look set up pretty good. The charts show you what I am looking at , BIOTECH & PHARMA are exploding, but please do research.  I have made Good money and been cut in half on Biotech earnings reports in the past .  I will also add a small list of others that you can look up on your own if you wish,  to see how they act before & after breaking out, etc.

AST – Nice run, nice Bull Flag. Buy a break out

AMPH  I posted this on May 29 ( Still valid)

CRMD– I mentioned this last week as a descending wedge.  It broke Monday and may pullback for an entry . In the past  ( green arrows) it Popped , went sideways and then higher.  You could look for that too.

REPH– Broke a wedge I was watching and back tested it  (forming a blue channel). A break above this channel or 50sma may run fast.  This went from $3 to $15.50 Quickly

DSKX– I just wanted to show this bullish set up ( bull flag) because it looks to have failed.  No News.  MOST bull flags follow through, but any can fail, so we use stops.  I actually think this drop may be temporary,  just down to the trend-line.  It was fairly light volume and price is still well above the 50sma.

You can look at charts of CBMG  (good one) OXGN, PRAN, GALT,AMPH, MNKD, ONTY, CBLI,  ADXS, and NVGN ( NVGN is good but now failing).  I like to look at these to learn how some break out & some fail.

FMSA–   ( provider of supplies for the oil sector)I posted a chart on this last week.  It has gone sideways , getting tighter.  It could pop & run higher fast

ERN:   I just wanted to show this.  I missed it and it is an energy stock that just excelled. It goes on my watchlist for a pullback