Volatility Audio Alert …

This morning the audio alert I have set on the ratio of 30-day volatility to 90-day volatility was activated.

Volatility Ratio – 65 Minute Chart

Maybe nothing will happen out of this early warning, but I will be following the VIX a little more carefully over the next week into month-end next Thursday.  The equity sell-off in China the past couple of days may flow over to other equity markets so I have decided to reduce my long positions by at least 1/2 here today before the early close.

Cheers … Leaf_West

Next-Up … A Melt-Up Higher???

I keep a close eye on the market internals because that is really the fuel that allows the market to make larger moves …

McClellan Summation Index – Daily Chart

Today saw the first positive market breadth signal since October 11th … that is over a month and all that has happened with the SPY is a slow grind higher in price while the trend strength histogram pulled back into the Chop Zone.  That pullback means that the SPY is now ready for its next expansion phase …

An expansion phase coming out of this holiday trading week makes perfect sense as we head into month-end next Thursday, and then get ready for the Santa rally that everyone is counting on.

Cheers … Leaf_West

 

Are Gold and Gold Miners Finally Ready to Go?

I wrote about a possible bottom in gold back in mid-October (click here), but for the most part the trades I put on  back then did not work-out.  No biggie as I was legging into that possible trade set-up and the amounts were in reality, insignificant.

I have started some new trades in NUGT and HGU (TSX Canadian exchange for my retirement accounts) today as I am thinking that maybe, just maybe, the US dollar, gold and the gold miners are ready to start moving.  Here is my view of the charts … Continue reading

TSLA Update – November 13, 2017 …

TSLA is making its product announcement on Nov 16th about its EV semi-truck.  They are likely to try and leverage that announcement into some type of an equity underwriting as the cash burn of the Model 3 is quite intense right now, and I think it is only going to get worse, so Elon would be smart to take advantage of any positive news to shove a bunch more equity down traders’ throats at these obscene price levels (>$300).

I continue to like TSLA to the short side, and I am looking to add a bearish trading position again over the next several days as price bounces into resistance …

TSLA – Weekly Chart

My bigger target in the medium term is that lower support level on the broadening price pattern at around $240.  Before that next leg lower, we need to find resistance a little higher up to suck in some more of Ron Barron’s money.

TSLA – Daily Chart

The median line at around $323 or the daily ATR resistance at about $330 should be the upper lid on any price bounce this week into that expected equity financing.

Cheers … Leaf_West

Have we Hit a Low in Inflation & Interest Rates?

One of the biggest items impacting the stock market the past several years has been all-time or near all-time low interest rates and by definition, low actual and expected inflation rates.  Eventually this long, long trend will end and we will begin on a new leg of rising inflation.  What will cause that is any one’s guess.

Soybean ETF (SOYB) – Weekly Chart

The long-term trend in Soybeans has been lower … eventually, supply and demand forces will reverse that trend.  The weekly chart has been in the condition of contraction in terms of trend strength, the past 7 weeks.  Any squeeze higher will possibly break a multi-year downtrend and possibly be a coincident sign of a generational low in inflation/interest rates being made.

Cheers … Leaf_West

Market Internals – October 27, 2017 …

The market is breaking higher and TSLA is continuing lower … my world is perfect!!  The one fly in the ointment, however, is the poor showing in market internals today.

Market Internals

You can see that the McClellan Summation Index is falling today despite the bullish action in the large cap market darlings.

McClellan Summation Index – Daily Chart

I don’t really care when the market makes a breakout move above a prior all-time high when the McClellan Oscillator is actually declining.  I am watching the internals in the hope of support being found here soon and then a bigger wider, more broad market push higher is launched.  That could lead to a real melt up into year-end.

Cheers … Leaf_West

 

Didn’t Quite Make It Back to the Toilet …

I wrote a blog piece on October 13th about Chipotle Mexican Grill Restaurants (CMG) (click here).  I wrote it back then because the daily ATR resistance level had been broken and therefore I was wondering whether or not the stock was complete in terms of its downward pain.  I stated that despite the improvement in the look of the daily/195-min charts, I was going to hold off looking at taking any positional/swing trades in CMG until at least after CMG was able to take-out the relative strength indicator’s prior pivot high on the 195-min chart.  It never got that far, before the earnings report took out the legs from underneath the stock price today.

My title reference of “the Mexican Two-Step” back on Oct 13th refers to the common occurrence that Canadians experience when down in Mexico during the winter months … bugs/viruses in the water/food/drinks often show up in the need to spend significant time on the toilet.  Well, it looks like the holders of CMG going into the earnings report didn’t quite make it back to the toilet in time to avoid an accident!

I thought it would be useful to put up the longer-term charts, to show traders once again why I think you need to have the longer-term frame charts in sync with your intended trade if you expect to swing trade any stock nowadays.  Ignoring the bigger time can cause serious pain at times … Continue reading