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.
If the trend is in-effect as shown, GLD could reverse tomorrow or in the overnight session.
The senior miners (GDX) stalled during today’s session. Price action is still at the Fibonacci 23.6%, retrace level.
To help clarify the firm’s positions, the following detail is provided as a courtesy only.
Several accounts are being managed. Currently there are two open positions in separate accounts (not advice, not a recommendation):
Managed Accounts
Detail Position Stop
Short GDX DUST 20.44
Short IBB BIS 25.46
Everyone has their own style. Ours adheres to tenets laid down by three market masters from the early 1900s. Detail on those criteria can be found here.
One of the reasons for choosing Livermore, Wyckoff and Loeb, is that no evidence exists these individuals were part of any full scale corruption or being the lap-dog for the globalist elite.
That statement is the complete opposite of what we have today. At this stage, the corruption and lap-doggery should be obvious to all.
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.
Attempted breakout that failed … thus far. That was today’s action for Biotech (IBB).
The (weekly MACD) divergence set-up has been in the works for awhile. The first time weekly MACD was discussed was this report nearly two months ago.
With the Dow reaching an apparent top last Tuesday and with other markets (S&P, NASDAQ) following suit today, there’s potential we’re at a pivot point.
Note that Biotech’s all time closing high remains IBB 145.80, reached back on July 20th, this year.
Volume for today’s session increased 43% over yesterday. However this session only pushed 0.23%, higher; opposed to a 1.23%, gain on Monday.
Upward progress slowed significantly in the face of higher volume. The bulls are tired.
While external world chaos rages, here, here and here, we’re focused on price action and taking advantage of low risk opportunities.
The response was to go short via BIS (not advice, not a recommendation) at BIS 25.61, with a stop set at BIS 25.46.
Note on stops and trading:
Every speculator has their style. We’re perfectly comfortable getting stopped out and re-entering several times on what is considered a viable set-up.
The current position may be stopped out at the next session. Depending on the price action at the time, the bearish divergence on the weekly may still be in effect and allow for a re-entry into the trade.
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.
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.
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.
It’s the heavy hitter. If we decipher what’s going on with it, then we can trade biotech for (potential) profit.
The chart shows price action began to retrace off the lows for the week. In doing so, it created a possible neckline.
The 38% retrace area, marked with the dashed line, also shows it’s a juncture between weekly bars; the circled area.
That’s a trading tip … watch the circle.
If price action gets to 38% and stalls, it shows weakness.
Our interest is to look for shorting opportunities. Specifically, via the 2X Inverse Biotech, BIS.
For years now, except for energy (nat-gas) and commodities (corn, wheat, et al), markets are being worked from the short side.
Steven Van Metre presents an excellent case for a deflationary impulse first before there’s any inflation.
The ‘macro’ as he calls it, provides a backdrop for what’s really going on.
For now, the action (not advice, not a recommendation) is to watch AMGN play out. If the trading is choppy, overlapping and laboring into the 38% level, then we have our answer.
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.
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.
That’s exactly what’s happening with biotech (IBB) and more specifically Amgen (AMGN).
Just like with Newmont and GDX from the previous update, Amgen’s the heavy hitter for the biotech sector.
What we see on the daily chart below and expandable version here, is that AMGN’s at the danger point.
Price action penetrated well established support and then stopped dead (so far).
If that’s the case, we’re looking for price action to rebound and move toward the 242 – 244 area; a 50% retrace from current levels.
If that point is reached, depending on the behavior of price action itself, the expectation is for a long-term reversal.
There have been several trades using BIS and LABD with the overall result being about break-even to slightly down.
More important than outright profit is the trading insight (over several months) into the sector itself. That insight can only come from active positions.
No amount of ‘paper trading’ or external analysis will provide a visceral feel for the market.
Summary:
We’re waiting for price action in AMGN and the overall IBB, to counter-trend upward as we head into November.
If there’s an obvious reversal at that time (not advice, not a recommendation) the risk on a short position may be at its lowest.
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.
The October 4th, update proposed a top and reversal for Biotech (IBB) at or near the election. November, 2nd , or 3rd, could be new highs followed by an immediate reversal.
Fibonacci week 34, from the 3/16/20 lows, is the week ending on Friday, November 6th.
The daily chart (below) has a trend that’s been confirmed; If it remains intact for the next three weeks, it will lead us straight to new highs at the beginning of November.
Following price action in this way allows for preparation.
Timing, position size and stop levels can be (and must be) planned in advance. Not a recommendation, not financial advice.
The topping formation in biotech has been followed and traded (via BIS and LABD) by this firm since early June.
Doing so, forces one to be accustomed to the behavior of the sector.
Behaviors such as counter trend action in IBB, tends to be complete and resume original trend, right around the 10:00 a.m. to 10:30 a.m. time-frame.
That’s a data nugget that can’t be obtained by parachuting into a sector, taking a position and hoping it all works out.
A perfect (short) trade set-up would be for price to gap-higher into the 2nd, or 3rd (November) and allow for an entry with a well defined stop … such as the top of the gap-bar.
Of course, at the open this Monday, IBB could break the trend-line and create an alternate scenario … anything can happen.
However, at this point, probabilities and momentum (although waning) favor continuation upward.
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.
Two markets being watched at this time are biotech (IBB) and natural gas (UNG).
Today’s session in nat-gas was strong but on the downside, price action closed below last week’s high.
There’s a lot going on with the hurricane in the gulf; potential earthquakes (threatening to rupture lines), already happening in the New Madrid zone.
So nat-gas could literally explode at any time.
We’ve analyzed price action enough to show a reversal underway.
The downside; it’s a bit weaker than expected. At least at these initial stages. However, commodity markets tend to start slow and then build into a blow-off top.
So, we could still see intense action during November and December.
Next, is biotech and specifically IBB.
The chart below is an interesting picture. Price up and volume down. This type of scenario has one of two meanings:
No. 1: There is no commitment to the upside and reversal is imminent
No. 2: Volume has decreased as sellers are backing away from the market … prices may drift higher.
With the negative report from Amgen (AMGN) during the week, the bloom may be off. Amgen is the leader (market cap) of the sector. If it has reversed as has been proposed several times, it may be strategic and long term.
The chart wedge that had been discussed here and here has now been officially and decisively penetrated to the downside.
Barring some miraculous recovery, the measured move for AMGN is in the vicinity of 192; about 20% down from current levels.
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.
The Danger Point® 