Author Archive for: Alex - Chart Freak

SPX DAILY -  Yesterday I mentioned the day 52 lows,  the 'last engulfing candle' and probability of a low forming here.   We did get follow through higher on Wednesday.

SPX DAILY -  We did get a pop higher.  It sold off into the close, but I still feel that this is a valid break higher for a dcl. It may drift lower along this trend line and fill that gap though.

SPX WEEKLY 1 of 4- We have a weekly reversal.

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So we were expecting that the Miners could possibly drop to do a 'back test' of the 50 sma.  In fact, I mentioned that in almost every report for weeks.  I must admit though, I did not expect it to happen all in one day, but that is pretty much what happened Thursday.  Let's take a look...

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This is my GDX Oct 15th chart, showing that that possibility exists for that back test.  I wanted us to be prepared for a drop like that, but like I said, I expected it to be more of a normal gradual dip lower.

Just 1 hr into trading, the drop in GDX & GDXJ looked like this, and it closed even lower at $19, just above that 50sma.

On top of  THAT,  this was Gold and it hardly dropped?

Can we make sense of this?  Is this still just the back test of the 50sma for GDX & GDXJ?   Did earnings of GG & NEM destroy all hope for Miners? Well, I do  have a few ideas that will give us clues to watch for as this continues to play out.  This will be a longer Friday report than normal, so let's get right into it...

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The selling continued in the stock market, but there is a recent development that I mentioned we should look for.

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DJIA - Yesterday I used this chart and mentioned that we could  look for a possible double bottom low, or 'W'-Bottom with divergence.  You see it at other Lows formed this year.

Tuesday the DOW dropped over 500 points and broke below the 200sma as a possible shake out / reversal.

1. It is safer to buy a swing low confirmed above the 10sma, as you can see, the last swing low 2 weeks ago failed at the 10sma.  However...

2. For higher risk traders  using technical analysis, That low can actually be bought with a stop below yesterdays lows,  but keep in mind...

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Nothing has really changed since the weekend report. The markets have been choppy and difficult to record any gains over the past few days, but I do love the way the Precious Metals sector acted yesterday, so let's  take another  look at what we have.

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SPX - You can see that these types of sell offs into an ICL can lead to a double bottom, and Monday our General markets sold off further.

DJIA -  You may want to look for something like this

HOWEVER....

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