Gold Changes Character

Mid Session

Another Bell Rings

Gold (GLD) was on track to continue higher into a potential up-thrust … right up to yesterday.

That’s when the character of price action changed.

Action suddenly had a down day with no buoyancy. That was the clue something else is at work.

Today, we saw the result.

At this juncture, with world events picking up yet again, we probably just entered or are about to enter a deflation impulse.

Summary:

The gold and mining sector continues to be chocked full of delusional bulls and rabid hyper-inflationists.

Just take a cursory look at YouTube sites that continue to ‘stack’. As repeated many times over the past year the ‘hyperinflation’ narrative is just not happening.

Food price increases along with fuel and shipping, are all related to a controlled demolition of the supply chain.

It’s not hyper-inflation.

It really does not take much research effort to figure that part out.

If there is a trade here, we’re going to leave it (not advice, not a recommendation) and just watch to see where the carnage goes.

Stay Tuned

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Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Gold (GDX) Pushes Higher

Fibonacci Order No Longer

It didn’t take long for the ordered price action discussed in the last update to break down.

Action in both gold (GLD) and GDX pushed through their own resistance levels.

During Friday’s session, all GDX short positions were closed out (not advice, not a recommendation).

So, what’s next?

If we look at the price action of gold (GLD) we see a potential set-up in progress.

That set-up is the phenomenon of repeating ‘spring to up-thrust’

The daily chart of GLD shows its been in a spring generated rally. As of the close Friday it’s at well defined resistance.

Price action determines market (trading) action. So we’ll see if GLD breaks out decisively to the upside or breaks out and stalls.

Stay Tuned

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Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Gold (GDX) Signs of Order

After The Close

Fibonacci Width Channel

Fibonacci Sequence On Trend

Adhering to Fibonacci time sequencing does not guarantee anything.

What it does tell us in the case of GDX (daily) below, is that price action’s exhibiting order.

Fibonacci width on the GDX trading channel can be seen here.

Order is what usually comes before dis-order 🙂

It won’t take much force either way, to negate the down-channel set up; or allow gold and the miners to descend into bear market chaos.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Gold (GDX) Bulls … Exhausted?

Mid-Session

Intraday Hourly GDX Reversal: Signs of Trouble?

It took one more day than expected.

With a slight new daily high, we’re potentially at the end of the GDX rally.

It should be noted: The past two weeks of trading have stayed within the price extremes of the wide bar posted during the week of August 20th.

This is called ‘inside action’; typically signaling preparation for the next phase … whether up or down.

Note, the inverse fund DUST pushed just 0.02 points (DUST, 19.78) below our stop level (not advice, not a recommendation).

That position was elected to be maintained … we’re still short.

The hourly unmarked chart of GDX is below:

Next, we invert the chart to mimic the inverse fund DUST:

Now, comes the mark-up:

From Wyckoff’s writings all the way back to circa 1910, he discussed ‘shortening of the thrust’.

When net progress becomes less and less … we know we’re nearing the end of the move.

Throw into the mix the high level of resistance at the GDX 33.00, and probabilities favor the downside … upside for DUST (not advice, not a recommendation).

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Gold (GDX) Bulls … Time To Hide?

Late Session

GDX Breakdown, Draws Nigh?

We’re not there yet and anything can happen in the meantime.

However, Senior Miner’s GDX, price action has moved lower during this session as expected.

Today has offered up one more clue for the bears provided GDX closes lower.

That is, we may have a channel confirmation:

Fibonacci time sequences are not necessarily always at price extremes. As shown above, they can define the width of a trading channel as well.

If this short (sell) set-up fails (GDX moves higher), we now have a definitive stop area for inverse fund DUST (not advice, not a recommendation); somewhere around: DUST 19.80 – 20.00.

Steven Van Metre in his last update, gave data on how the dollar is in a rally and nearing breakout position.

So far, there’s still a negative correlation between the dollar, gold, and gold miners.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Knock Three Times …

Gold, GDX Warning: Breakdown Imminent?

It’s true when price action rebounds off a level, whether support or resistance, that level is confirmed.

However, personal (mental) bias, like the rabid hyperinflation ‘dollar destruction’ gold bulls, collectively have their minds so twisted, every bounce off so called support, is a buying opportunity.

That kind of blindness can set oneself up for (financial) disaster.

Well, we’re about to see if the current bounce was a buying opportunity or harbinger of a “free fall” breakdown.

Price action’s the final say. So, let’s take a look at what its been saying about the latest move.

Un-marked weekly chart of Senior Mining (ETF) Index GDX:

Next, comes the support line and contact points identified:

Now, comes the important part. Each rebound off support has less upward travel than before:

The right-most green arrow (upward travel), may or may not be complete. One fact in favor of completion is the significant amount of resistance around GDX, 33.00.

Price action has spent six weeks transacting in this area. Three weeks above support and now three weeks below.

Positioning:

We’re at the danger point; risk of being wrong on a short position is least (not advice, not a recommendation).

At this juncture, price action does not need to go far to either support or negate a short trade set-up.

With that in mind, the Project Stimulus account is short this sector via DUST (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

GDX Update

After The Close

No New Weekly High

GDX price action pushed through the 3-day highs shown in the last update. Even so, on a weekly basis, price action was unable to make a new high.

We see on the chart, a breakdown through support and this week’s test.

After today’s Fed speech, we’ll see if this is all there is for the upside on gold and the miners.

Recall, from a recent J. Bravo update, there aren’t any bears left.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

GDX: Short Sell, Set-Up

11:50 a.m., EST

Gold miners back at it … about to ‘Up-Thrust’

The daily GDX chart is almost self-explanatory.

Price action spent about seven days in spring position before finally getting up enough energy to launch. The past two trading days have been essentially straight up.

Straight up that is, into known resistance.

This site’s not part of the hyperinflation crowd. It’s too easy to jump on the bandwagon, get the clicks and then say it’s all ‘manipulated’ when price action does not follow the narrative.

The (market) truth is and has been for a long time, gold and the miners are not yet confirming hyperinflation.

Buying gold/silver, gets more ‘clicks’ than buying food and showing everyone your freeze-dried plastic packs.

Since you have chosen to monitor this site, you have also made a choice to access information that’s not comfortable; information that may challenge (or even change) already held beliefs on how it’s all supposed to go down.

Case in point: With each passing day, it becomes more clear that food (Genesis 41) and the ability to create it, will come first as one storehouse of wealth.

Gold and silver will come … but only after nearly everyone has had it stripped from them (not advice, not a recommendation).

As of this post, GDX, is pushing through the resistance level shown in the chart.

How it behaves if/when it contacts the 38% level, will let us know if a downside reversal (up-thrust) is in the works.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Livermore, Wyckoff, & Loeb

Buffett’s not on the list

After thirty-four years of researching the markets, focus has narrowed to three masters from the early 1900s; providing a solid framework for addressing the markets of today.

More detail on these masters can be found at this link.

Summarizing their knowledge as follows:

Strategy, Tactics, & Focus

This update demonstrates how those tenets are being implemented.

Strategy:

In Livermore’s fictional autobiography (Reminiscences), he muddled around for years before identifying his niche.

That is:

‘What’s going to (or what’s likely to) happen in a big way.’

That insight has been used to identify the biotech sector as ripe for complete (and well deserved) implosion; more so than any other sector in the market.

For many months, the case continues to build for collapse.

Here’s just one more brick in the wall; providing even more support for implosion.

Tactics:

Wyckoff committed his entire professional life to decoding the market and its moves.

He is (as far as available data shows) the father of technical analysis.

Terms like ‘support’, ‘resistance’, ‘accumulation’, ‘distribution’, did not exist before is treatise, “Studies In Tape Reading”, published in 1910.

His bottom line:

Price is moved by a force of its own; having nothing to do (in a causal way) with fundamentals:

‘What is the market saying about itself.’

The biotech sector SPBIO, is tag-teaming with gold miners GDX (and GDXJ), for downside leadership.

SPBIO finished the week down -27.5%, from its February 9th (2021) high; running a close second to GDX, which finished the week down – 27.6%, from its August 5th (2020) high.

From a speed-of-decline standpoint, biotech’s in the lead.

Focus:

Loeb’s brutal admonition was: ‘The naïve, lazy, mediocre, ignorant and the incompetent “diversify”.

His follow-on corollary was: ‘Real market opportunities are few. If one is discovered, it must be used to its maximum extent.’

Loeb’s assessment of those in the market, is not much different from Wyckoff’s:

“The average man never makes a success of Tape Reading.

Right you are! The average man seldom makes a success of anything.” (emphasis is Wyckoff’s).

From the above list, ignorance can be fixed through determination, study, tenacity and the never-ending search for (market) truth.

The others, not so much.

Using Loeb’s tenet, that is, ‘focus’, we’ve taken it and have gone short and continue to go short (not advice, not a recommendation), the biotech sector via LABD.

Summary:

There’s no guarantee the short trade will work out; yielding a significant gain.

Any number of things can happen:

Internet outage, power outage, terrorist attack, supply chain and transportation shut-downs … literally, anything.

However, being short (from a personal standpoint) is better than wringing one’s hands, cowering in fear, looking to the (bought and paid for) financial media to provide direction on what to do in this unstable environment.

Epilogue:

By using the life’s work of Livermore, Wyckoff & Loeb, its been determined, being short biotech (and possibly the mining sector) is the appropriate market stance.

With the caveat that even now, one might need to exit the trade; it still appears at this juncture, the on-going short (not advice, not a recommendation) is the most focused profit opportunity given the current environment.

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

Update: Dow Theory, ‘Sell’

9:05 a.m., EST

Dow 30 (DIA) breaks trendline

Price action declining towards support

Price action rolls over and in the process, breaks the uptrend.

The prior update, had this link to an explanation of the sell signal (not advice, not a recommendation).

The sell signal is confirmed if/when the support at the dashed line is penetrated with a close below that line.

Summary:

The markets were volatile yesterday with sharp moves in the dollar, gold and the gold miners.

Pre-market action has gold (GLD), continuing sharply lower; – 4.1 points, or – 2.37%.

Inverse GDX, gold miners DUST, is trading higher as well; up about + 1.1 points, or + 6.65%.

For those monitoring this site on a regular basis, none of the above is a surprise.

We’ve been reporting on the pending dollar reversal for weeks; how gold (and silver) still appear to be inversely correlated.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.