Running The Bases

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We've been looking at bullish bases in the Energy and Precious Metals sector lately. Very quickly  they have been making some strong moves. Explosive gains actually.

For example, this was SGY when I pointed it out.  It ran from $4 to $7 in August/September and then pulled back after hitting resistance at the 50sma, forming an inverse H&S.  When it broke above the 50sma , it was a buy around $6.

SGY

SGY  - 3 days later and it is nearing $10.  Thats $4 to $10 in about 1 month. 

SGY 10-8

EXXI is up 150% in 7 days!

EXXI 10-8

These are obviously getting extended and may be due for a pull back.  That means that it is best to look at other bases that are currently set up, but not extended...

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The Ups And Downs…

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The saying ,  "What goes up must come down"  is true within Bull and Bear markets. Lets take a look at what is going up and what is likely to come back down, keeping in mind that the FED MINUTES are to be released later today.

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I drew this last week to show that I expected the SPX to move up to the purple line

SPX WKLY SIMILARITY Read More

Gusher

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The Oil and Energy Stocks were leading the way with their recent bullish activity. As pointed out yesterday, the XLE broke out from a downtrend and was probably signaling that OIL was about to follow. Quite a few of the stocks were up 20 - 30% in 1 day yesterday! We'll discuss more about the potential here in a moment, but first lets review the rest of the market action.

SPX-   Resistance is overhead.  A pause below the 50 sma may be building energy to break higher, and a break above could see buyers rush in and push it higher.

SPX 10-6

Why is it possible that this resistance wont hold it back?...

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