Entries by Alex - Chart Freak

OBSERVATIONS

I have been watching the various markets intently , examining internals and how they've reacted under similar circumstances in the past  to try to get an idea of what to expect .  I think that I have done rather well with the general markets and Metals and miners,  but I must say...there are some extremes in some areas that I have just left alone until I get a clearer idea of how things may unfold going forward.   What am I referring to?  Well, specifically the  ENERGY  sector with OIL and NATGAS has been a little tricky, and of course the $USD has been very strong -  now even higher than I anticipated.   lets take a look at those areas.  They that have been difficult to call,  for Sure.

  I know what I "Guess" they could do, but when it comes to putting advice in my premium reports on these sectors,  I have decided to just wait until things clear up , and focus on some other very trade-able areas.

 I expected the $USD to stop in the $92 area.   ( Actually, I had that as a target, but I thought it may not  make it there, I mentioned that it could roll over near 91  because GOLD began completely ignoring the $USD strength. I assumed GOLD was sniffing out Dollar weakening).

I posted this chart Jan 2- $92 target

$USD JAN 2

 

Then on JAN 5 , I noticed this ...

 

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Nothing Has Changed

You could basically read my last few reports and get the same results.  Even though the numbers have changed and the moves are taking place, my outlook hasnt changed.

Here is yesterdays wkly chart of SPX  - we expected a move higher, but a bounce or a buy the dip recovery?

SPX JAN 6 WKLY

I thought that the markets looked a little 'different' this time, so I mentioned that it could 'fail' .  Yesterday we did have a reversal

And CNBC  had a lot of people on saying, "You just have to Buy the Dips. Its been working for years now! "  Is THAT what I mean when I say nothing has changed?...

 

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EXPECT PULLBACKS

Markets dont go straight up or down

  ( yes I've seen the $USD and Oil Lately    )  Well actually,  they haven't been 100% straight up or down either. We expect Pullbacks , consolidations,  dips, etc . Even the straight up dollar move wasn't straight up , as you can see here in my Jan 2 chart, there were dips ...

$USD JAN 2

 

Pullbacks  happen all the time, and the key is to examine them separately and look for opportunity. Lets discuss pullbacks ...

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Many Still Cant See It

Many still cant see it ,  lets zoom in for a minute

BULL

 

If you're worried that the public will see this , dont.  I have posted for 8 weeks my thoughts on a particular sector in extreme detail, and I still cant convince everybody of what I have been seeing, this Picture wont change anything for the public. So Lets discuss Various  Markets ...

 

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A Minnie Victory

Friday was a Mini victory if you ask me, and I'll tell you why after a brief update of the markets. So far The SPX, Q's and Dow acted just as I thought they would, they have dropped after making new highs (QQQ was likely not going to make new highs, and it didnt ).   DEC 30 - I posted this that I'd be watching the QQQ's at the 10sma, it looked weak.

QQQ Dec 31

 

Well, it broke right through the 10sma by the end of Dec 31,  so what now? All doom & gloom from here?

 

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Do You Recognize The Difference?

Real Strength and Real Weakness. 

In Humans  , sometimes strength & weakness can  show up as obvious,  seen by outward appearance alone.  In some cases, however, it may require an X-Ray  to peer inside and see how the internals are doing.  Its really the same with the markets. A Rally can appear strong,  and yet inside it may show evidence of weakness , and visa-versa can be  true too.

I know many felt that the year end 'Santa Rally ' ,  as it is often called at the end of the year,  looked like a strong continuation of the rallies  that we are used to seeing lately.  Here at Chartfreak, I was mentioning to my premium readers that under the microscope, the rally looked to be weakening to me.  I thought that we might actually see some rolling over and possibly even some selling into 2015.  For how long? We will know soon enough, but notice what I was pointing out to my subs last week.

 

THE SPX was falling short in some of its 'internals'-  It looked weak to me as it was breaking out.  I thought it might actually  roll over after breaking to new highs,   like it did in September.

SPX dec 28

SPY NOW  ( Broke with weakness & fell back)

SPY Jan 2

 

To me the QQQ looked even weaker...

 

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Low Liquidity

  During times of low liquidity,  it's  easy to rock these boats back & forth , but it's not always easy  to get them sailing smoothly in the  intended direction.  When the tide rises , or the flow of liquidity returns, however, they can begin a journey of smoother sailing .  During weeks of holiday trading, its similar in  the markets.    low liquidity can cause volatility and rock things back and forth, but it's not always clear which direction things really want to flow.

  Today is January 2, and it's the first trading day of 2015, but I'm not so sure that the liquidity will return until next week.  Until then ,we may have more volatility and things may not look very clear, but there are some interesting developments to look at.  As I write  (Pre-Mkt) Futures are up nicely for the DOW, SPX, and NASDAQ,  while GOLD shot down to $1169 , Silver is down .10 , and OIL has dropped to new lows.  The $USD is again strong, up to $90.85!  I still think next week will clarify the true direction of these markets, but notice this...

$USD Jan

 

The dollar is at new highs in Pre-Mkt  at almost $91., yet Even with the continued Dollar strength...

 

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QUICK REPORT

Just a quick run through since we have just 1 trading day left in 2014 and it 'Should Be'  a light volume day ,  since many will be leaving early to prepare for any evening activities.   I'll start with QQQ.  I posted his chart yesterday and said it looked like we could are stalling and could begin to pullback...

 

QQQ Dec 30

This is what happened Tuesday  ...

 

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Hot Air

When I think about the markets right now,  it is Dec 30and we have 2 full days left for the markets to trade in 2014.  I'm thinking that we are seeing a little hot air balloon action, where things just keep floating higher on light volume.  Maybe people dont want to sell now and have to pay taxes this year on their recent gains, but what will they do in January when they can take some profits and not have to pay taxes on their gains until 2016?  Will they lock in some gains? 

Lets take a look at the SPX

SPX DEC 30

Notice how we hit that upper trend line this summer in JUNE and just rode it higher for a couple of months, will we do that here?  ...

 

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Time Is Just About Up

Using cycles for 'timing' various sectors of the markets helps us to anticipate when we can expect a possible turn to take place.  True, you get a little leeway of  maybe plus or minus a few days, but sooner or later, we reach the end of that time period.   It seems that we are rapidly approaching the  point where it is Do Or Die time.   Each day that passes this late in Cycle timing brings us  closer to the point where we begin to see clearly how things are going to unfold.  As usual, I have about 20+ charts ,  and at this point I'd like to start with-

 

GOLD - With the $USD at new highs, GOLD hasn't been hammered down to new lows as one may expect.

$GOLD vs USD

 

I posted the above chart in my public report, but it still leaves questions.  Was that a bear flag that would just break down?...

 

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