Not much to talk about today, we are in the same situation as yesterday, with additional upside. Friday's Jobs report could move the market either way so I am still sitting in the metals market. Once the uptrend shows weakness I will probably short the S&P, but I don't want to go long this market right now. If there are some breaks of higher levels I will consider it but currently we are in a intermediate downtrend (May until now), so playing counter trend isn't my game so I will find other markets to trade in.
The candle stick formation is of a bullish continuation / confirmation of yesterdays massive move up. However, I do want to point out that this could be a perfect setup for a Evening Star, if tomorrows jobs data is terrible and the market has a down-leg that takes out the mid point of Wednesday's open/close price. Strong volume would confirm that the evening star has turned the market. This is an unlikely scenario but worth noting since playing the counter trend could be dangerous.
Gold up at 1250 mark, close to the all time high, possible resistance could be at the 1300 mark.
Silver up at the 19.60 mark which is huge, could have potential to break out to the 32 dollar mark that many silver bulls think is the next logical target for silver.
Platinum (1550)
All metals are up today including Copper
Friday, September 3, 2010
Thursday, September 2, 2010
Strong market rally today
So as mentioned in my previous post the target level if the market breaks to the upside was 1080. Today it closed at 1080.20. It is always nice to know where the market could go. On Tuesday I was out of 2/3 of my short position, and I was stopped out on the last 1/3. Here is the Chart.
The explosion was on Manufacturing data coming from China and the US which was slightly positive. The next 2 days there are weekly Job loss claims and month employment information. I expect these to be very negative on the markets but I will not enter a trade until some of the lower levels get broken since there is nothing stopping the market to rally a bit more possibility to the 1100 mark. Today's activity touched the 20 MA and is close the 50 MA. The 200 MA could be resistance but the 1100 mark will keep us in that triangle that has formed (white top line with the purple line 1039 mark).
Yesterdays platinum play worked out perfectly, with a 10% increase after breaking out of the triangle. With a strong MACD positive tick. The condition is not overbought either so there is more room to go up. However I do expect a possible pull back some time this week but the 1.13 level is a key to hold. Depending on the next 2 trading days I might rise my stop loss to the 1.13 level.
SBB I mentioned as my silver play, I have now increased my position on today's pull back of 6 cents.
I do expect this stock to have a sharp increase some time soon. From watching this stock I mentioned before the increase in silver and gold this past 2 weeks does not seem to be price into this stock yet.
Yesterdays platinum play worked out perfectly, with a 10% increase after breaking out of the triangle. With a strong MACD positive tick. The condition is not overbought either so there is more room to go up. However I do expect a possible pull back some time this week but the 1.13 level is a key to hold. Depending on the next 2 trading days I might rise my stop loss to the 1.13 level.
SBB I mentioned as my silver play, I have now increased my position on today's pull back of 6 cents.
I do expect this stock to have a sharp increase some time soon. From watching this stock I mentioned before the increase in silver and gold this past 2 weeks does not seem to be price into this stock yet.
Wednesday, September 1, 2010
S&P end of August
Added some trend lines, that explain why today was a non event.
The light blue line has resistance at around 1051. That line as i mentioned before is a big line for me. Reason being is that if we stay below that, we have re-entered the down trend we entered in May during the flash crash.
The red line is from a recent swing low that may be weak support but it is not as important as the yellow line from the 2009 lows. A strong move is in the works the real question is when and which direction. The labour day is this weekend so alot of people are calling that the market will remain flat this week.
Over all I believe this market is going drop, however, I am opened to the possibility that there could be a bounce. There are many elliot wave counts that can make the argument that we are entering hell, and others that say we could have a medium size bounce and others say we are going to take out the highs in 2010. So with all the talk about QE2.0 i have added to my metals position and lighted up my core short on the s&p.
One note about the Fib levels that are the horizontal dashed lines. July 2009 we found support at the 38.2% retracement level, then resistance at the 50%. The the 2010 July low look where support was found, perfectly on the 61.8% retracement level. So my target for the S&P is based on the 50% retracement which comes in at around the 950 mark. Any breaks below that I would consider the 38.2% as the place the market will bounce hard again.
The close up of current price action is as follows.
I have had to redraw this blue line a couple of times since i have used 3 computers in the past week to do blog posts but the line has not been altered and look how well it has come into play. Strong resistance but sandwiched right now at the 1040 level. That level has now been tested 3 times (today's low was: 1040.88). If the market is to remain flat for the week it would stay in between the cyan and purple line, which if the 1040 is broken, things will move quick to the next major support which I think will clearly be that 61.8% retracement the 1010 level, and obviously the 1000 is a strong psychological level. Breaks above this could rally to the 1080 level when it comes into the 50 and the 20 moving average.
The next 7-10 trading days will be very interesting.
Lets look at a trade I have entered for a gold / silver play.
http://www.sabinagoldsilver.com/s/Home.asp
The stock ticker symbol is SBB on the TSX.
I have featured this stock before because of its very bullish chart.
My entry was at 3.31 which was the lowest the stock has opened or closed at in 5 days, and today a nice bullish continuation candle stick was formed with strong volume behind it with 125,000 more shares exchanging hands.
The MACD signals that the momentum is still techincally down however today we have a reduction in this negative momentum. The Slow Stoch has crossed over and is signally that the momentum is up and the stock is not over bought.
Some of the other reasons this trade was made is that 2 other companies I follow AXR and FR both were very strong the past 5-6 days. This made sense because silver is now trading at close to 19.30. However, this normally strong strong was remaining flat. When SBB caught up to the silver bullishness my feeling is that a potential top would be around the 3.91-3.93 area. With resistance also coming in at the 3.68 area. I would consider taking profits in these areas however it depends on where silver is trading. If silver continues to break out I will just trail a stoploss behind the stock. From a longer term chart this stock has rallied 4 times and has consolidated through time by just chopping sideways for a week or 2. I believe this is the current case and we will see new highs over the next month.
I did get into a platinum play today
As you can see the stock price is currently sitting on the 20 / 50 MA and is ending a wedge in this triangle. There was healthy volume today compared the last few weeks. And the Techincals are pointing to a turn in momentum. If this can break through that 200MA could be resistance.
The red line is from a recent swing low that may be weak support but it is not as important as the yellow line from the 2009 lows. A strong move is in the works the real question is when and which direction. The labour day is this weekend so alot of people are calling that the market will remain flat this week.
Over all I believe this market is going drop, however, I am opened to the possibility that there could be a bounce. There are many elliot wave counts that can make the argument that we are entering hell, and others that say we could have a medium size bounce and others say we are going to take out the highs in 2010. So with all the talk about QE2.0 i have added to my metals position and lighted up my core short on the s&p.
One note about the Fib levels that are the horizontal dashed lines. July 2009 we found support at the 38.2% retracement level, then resistance at the 50%. The the 2010 July low look where support was found, perfectly on the 61.8% retracement level. So my target for the S&P is based on the 50% retracement which comes in at around the 950 mark. Any breaks below that I would consider the 38.2% as the place the market will bounce hard again.
The close up of current price action is as follows.
I have had to redraw this blue line a couple of times since i have used 3 computers in the past week to do blog posts but the line has not been altered and look how well it has come into play. Strong resistance but sandwiched right now at the 1040 level. That level has now been tested 3 times (today's low was: 1040.88). If the market is to remain flat for the week it would stay in between the cyan and purple line, which if the 1040 is broken, things will move quick to the next major support which I think will clearly be that 61.8% retracement the 1010 level, and obviously the 1000 is a strong psychological level. Breaks above this could rally to the 1080 level when it comes into the 50 and the 20 moving average.
The next 7-10 trading days will be very interesting.
Lets look at a trade I have entered for a gold / silver play.
http://www.sabinagoldsilver.com/s/Home.asp
The stock ticker symbol is SBB on the TSX.
I have featured this stock before because of its very bullish chart.
My entry was at 3.31 which was the lowest the stock has opened or closed at in 5 days, and today a nice bullish continuation candle stick was formed with strong volume behind it with 125,000 more shares exchanging hands.
Some of the other reasons this trade was made is that 2 other companies I follow AXR and FR both were very strong the past 5-6 days. This made sense because silver is now trading at close to 19.30. However, this normally strong strong was remaining flat. When SBB caught up to the silver bullishness my feeling is that a potential top would be around the 3.91-3.93 area. With resistance also coming in at the 3.68 area. I would consider taking profits in these areas however it depends on where silver is trading. If silver continues to break out I will just trail a stoploss behind the stock. From a longer term chart this stock has rallied 4 times and has consolidated through time by just chopping sideways for a week or 2. I believe this is the current case and we will see new highs over the next month.
I did get into a platinum play today
As you can see the stock price is currently sitting on the 20 / 50 MA and is ending a wedge in this triangle. There was healthy volume today compared the last few weeks. And the Techincals are pointing to a turn in momentum. If this can break through that 200MA could be resistance.
Monday, August 30, 2010
Bears still in town?! and Platinum!!
So the market on Friday had a big day up on the GDP revision. Today most of that gain was wiped out. I do believe a decent bounce could occur at some point but I wouldn't want to play the counter trend right now. Since at any point bad news hits it could trigger another day like this. I still have 1/2 my s&P short position which i will hold until there is more of a direction that forms. The indicators are still pretty negative. The Slow Stoch has come out of being embed and now are just over sold so that could result in a bounce. My target is still at least 950, if not 850 in the S&P 500.
My interest in metals has been grow with learning more different industries. I am going to look at the Platinum chart and then a couple of small cap mining plays.
Something interesting about the metal investments.
"Investors need to remember that the new ETFs have different tax treatment than stock funds. From the prospectus for ETFS Physical Palladium Shares: “Under current law, gains recognized by individuals from the sale of ‘collectibles,’ including physical platinum, held for more than one year are taxed at a maximum federal income tax rate of 28%, rather than the 15% rate applicable to most other long-term capital gains.”"
http://blogs.marketwatch.com/etfblog/2010/01/08/first-platinum-palladium-etfs-begin-trading/
Interesting how there is more taxes on metals because they are not recognized as an investment by the US laws. They are collectibles
.
The weekly looks interesting, in 2008 the market tanked alot. Looks like a base is formed and it is just about to get over the last Moving average. The slow stoch and the macd are bullish. The MACD looks like it is about to turn bullish very shortly.
On the Daily.
All moving averages are right above this level and the Slow stoch is almost over bought. However, the bullish tick in the MACD makes this very interesting. When this triangle breaks it will more quickly, this can be seen by observing how the bollinger bands are narrowing in.
Lets see how some Mining companies look.
The Slow stoch is close to being oversold and the macd downward momentum is decreasing which means a positive tick up is quite likely at this point. Getting above that 20 and 50 MA would be huge for this base to remain. If I were to get into this stock looking at a break above the 20/50 MA (1.89) as entry then a stop loss 1.73 (Aggressive), 1.78 (conservative)
If i sell the remaining shares I have in the inverse ETF for S&P I will consider picking up this stock and maybe this other one.
Subscribe to:
Posts (Atom)