GDX Update …

I wrote about a possible 2019 swing trade that I was looking at/starting on November 12th (click here to read that blog post).  Long story shorter, I am playing for a big move higher in Gold Miner stocks in early-2019.  I go through my thoughts in that earlier blog post, but one of the things that I was waiting for for additional confirmation was the completion of an ABC corrective move and a break of the downward sloping broadening price pattern.

I was buying GDX and HGU.TO in my stock accounts the past several days and yesterday I added WPM.TO on the flush after their somewhat disappointing earnings report.  My audio alert went off this morning warning me of a first break higher out of the downward broadening price pattern.  Here is the chart …

Gold Miner ETF (GDX) – 195 Minute Chart

A gap higher out of this type of broadening price pattern will almost always need to see some type of consolidation that would confirm acceptance by the market of that price move higher.  I suspect that we spend at least 3-5 more days chopping around to see if price is really ready to begin moving higher.  I am hoping that 2019 will actually work out nicely for gold/silver and the miners.

Cheers … Leaf_West

US$ Update ….

I wrote a blog post about the US$ yesterday morning (click here for that post).  The price action in the DXY US$ Index today makes it look like a possible high was made yesterday to complete the B-wave I have drawn on my weekly chart … here is that chart from yesterday’s blog post.

US Trade Dollar Index – Weekly Chart (as posted on November 12, 2018)

Here is the price action from today …

US Trade Dollar Index – 240 Minute Chart

US Trade Dollar Index – 60 Minute Chart

The 240-min chart shows that the ATR support is still in place, and I like to see that taken out before I begin to think that any daily chart is turning lower … that ATR support is at $97.03 vs the current price of $97.16.

Could crude oil have made a pukefest low today right on the heels of the US$ making an important top??  Yesterday, I thought crude would find support around the lower support line of the broadening price pattern chart.  Here is that chart updated for today’s pukefest …

Crude Oil Futures Contract (CL) – 240 Minute Chart

Normally, the 3rd wave of a price structure will terminate around the 1.272x extension drawn off of the 2nd wave … if the third wave gets extended it would normally stop at the 1.618x extension target.  Every once in a while, you get some real good capitulation like we did today probably in crude.

Anyways, the US$ top would be an important event for crude and other US$-based commodities.

Cheers … Leaf_West

TSLA Update …

TSLA has been my favorite stock for trading during 2018 … I have made several posts about TSLA’s set-ups and I am looking once again at zones where resistance can be expected,  Here are the charts …

TSLA – Weekly Chart

The rising/broadening price pattern is still intact but the median line is likely to be formidable resistance here soon.

TSLA – Daily Chart

The Median Line resistance is around the $358 level.

TSLA – 195 Minute Chart

The 195-min chart is painting light blue candles warning me of an extreme move of price away from its slower moving averages.  Note that volume is tapering off as we get higher and higher on this expansion move.

Be on guard if you are long TSLA as we push into the $350 – $360 levels.

Cheers … Leaf_West

AMZN … Where will the Music Stop?

AMZN is paying the price during this market correction for being so widely held and for having run so hard for so long.  Where is support likely to re-appear?  No one, knows and I think that will depend almost entirely on when the tech market gets a bid finally.

Here are the levels I am looking at …

AMZN – Weekly Chart

The weekly broadening price formation has seen price pullback to the upper support/resistance line.  Will price find meaningful support here at around $1375??  Maybe …

AMZN – Daily Chart

On the daily chart, I can see what looks like a nice band of prior volume in the $1125 – $1200 zone … with that zone in mind, I decided to sell some OTM put options that expire before the next earnings date (April 26th).  I sold some of the $1150 puts that are going to expire on April 20th.

AMZN – 195 Minute Chart

I continue to trade AMZN as my main focus intra-day, but I am not yet prepared to hold any long/short position overnight.  Selling some OTM puts at that $1150 level is a much safer way of making a multi-day bet on what will happen to AMZN over the next couple of weeks.

Cheers … Leaf_West

Energy Has Found its Resistance Level …

I wrote two pieces about energy stocks and crude oil prices back on August 29th (click here) and on September 14th (click here).  The call on crude oil and energy stocks were pretty good if I do say so myself.  Both crude and energy stocks are at areas where I think they have found obvious levels of resistance.

Crude Oil Futures Contract – Daily Chart

Crude has made a beautiful 3-wave price structure out of a downward broadening price pattern.  My software is painting dark blue extreme trend strength warning candles with pink divergence dots right as price has pushed into the 1.272x – 1.618x extension target zone for Wave 3.  As good a spot for crude to begin a corrective pull-back price structure as any.

S&P Energy Index ETF (XLE) – Daily Chart

As I suggested back in late August, energy stocks made it all the way up into the median line of the upward sloping weekly broadening price pattern.  Crude and energy stocks are going to crush a lot of dreams here over the next couple of weeks I would think.

Cheers … Leaf_West

 

Has the Next Leg for Bonds Begun? …

When you look at the weekly chart for bonds, you have to think that maybe, just maybe, the great Central Bank manipulation to global interest rates is coming close to the beginning of the Great Unwind.  Here are some weekly charts to ponder …

20-Plus Year US Bond ETF (TLT) – Weekly Chart

Price is still contained within the weekly downward broadening price pattern … we are in the middle of the 7th consecutive “contraction” warning signaled by my software painting the weekly candles yellow.  What follows contraction?  Typically it is a new expansion phase …

The Price Momentum indicator has shown that price has been in a squeeze for 16 consecutive weeks, which is pretty unreal, and almost all bond portfolio managers are likely fast asleep at the wheel and not prepared for what is going to happen next.

The Moving Average Spread Indicator is looking like it wants to make a second, lower cross-over, which typically is the sweet spot where the best shorts are made.

Where is support for price inside the weekly broadening pattern?  It is around $106.50ish … which is about 14% lower than yesterday’s close.

What would a 14% drop in bonds mean for all those equity holders who are maxed out with their margin accounts??  Probably a little bit of pain!!

Cheers … Leaf_West

What’s Going on in Bonds?

Bonds have not been doing much at all in 2017 …

30-Yr US Treasury Yields – Weekly Chart

The high in yields came in about 3.20% and the low of the yearly range at about 2.60%.  We have spent the better part of the last 6-months in about a 20bps range – like watching paint dry.

30-Yr US Treasury Futures Contract – Weekly Chart

The weekly chart for the 30-yr futures contract has painted 6 yellow warning candles in-a-row here … things are getting unsustainable, and maybe we get some fireworks in bonds to coincide with a little pullback in equities in the new year?   Nah … not possible, right?  Didn’t think so.

20-Yr+ US Bond ETF (TLT) – Weekly Chart #1

The TLT is not quite as tightly wound as the futures contract, but it looks even more like it wants to break higher than even the futures contract does.

20-Yr+ US Bond ETF (TLT) – Weekly Chart #2

The downward broadening pattern for the weekly chart in the TLT shows us that a potential big trend reversal could be close at hand if the upper resistance line can get taken out … could that be one of the bigger trades for 2018 – a rally in bonds?  No one is expecting it, as everyone is betting the strengthening global economy will lead to lower bond prices.

If that is the case, why have bond yields been falling?  Must be that transient factors driving inflation measurements lower these past few months!!

Bottom Line – keep your eyes on bonds going forward here for the next couple of months.

Cheers … Leaf_West