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.
Rates are not going lower, they’re going higher; sooner rather than later (not advice, not a recommendation).
Yesterday, ZeroHedge reported the 5-yr auction was nasty with rates rising to near recent highs.
Today, we have yet another supply disruption impacting so-called ‘inflation’.
Couple that with an apparent real estate implosion.
DH Horton (DHI) down nearly – 12% in just days and holding steady in the pre-market session.
It looks like the bubble party is (finally) over.
Gold Miners To Catch Bid?
The miners are at another critical juncture.
The Juniors GDXJ, are up in the pre-market session (8:00 a.m., EST) and may be catching a flight-to-safety bid as parts of the markets top out and/or reverse.
That flight to safety may not last long as we’ll see below.
Junior Miners GDXJ, Daily
Trading is up about 1% or 0.32 pts in the pre-market.
GDXJ, price action is at The Danger Point®.
We are either in a reversal (Wyckoff spring) set-up or just a pause before posting lower.
If it’s a rally, the target area is shown (magenta oval); corresponding to a 61.8% retrace.
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.
‘They [The Fed] are totally tricking the markets’ (time stamp 3:30), link here.
Yes, it’s a real chess game going on and the other side, makes up the rules.
This update presents that despite all the manipulation and head-fakes, significant market pivots in the miners were identified (correctly) with Wyckoff analysis.
That analysis, in turn, helped develop a long-term strategy (not advice, not a recommendation).
Junior Miners GDXJ, Weekly Close
Three key points are shown on the chart.
The first goes all the way back to October of 2020, link here. There’s something wrong with the miners.
Potential for another downward pivot, link here, was identified to-the-week, if not, to-the-day.
The subsequent move printed the most impulsive price action since the spike melt-down of early 2020.
Which brings us to today.
Another potential pivot has been identified, link here.
As of this post (11:20 a.m., EST) the Juniors GDXJ, continue to rachet lower.
The Long Term
As Ed Dowd points out in this interview, what’s happening now will affect us all for decades, if not centuries to come.
Therefore, it’s a good idea to have a long-term strategy.
From the above chart, it’s clear that Wyckoff analysis has been on the correct side of GDXJ price action; the bearish side (not advice, not a recommendation).
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.
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 day the SOXX, closed higher but failed to print a new high.
It’s now early in the session (9:55 a.m., EST) and we have a new daily low.
There have been sell signals before but this one has a different ‘feel’ (not advice, not a recommendation).
Yesterday, bonds (TLT) gapped open lower and broke below support; rates are rising … again.
The 1987 Set-Up
Those old enough, remember the set-up. Rates up (bonds down) and market rising to all-time highs at the same time.
A chart of the ’87 crash is here. Note, the high was in August, that year.
Now, a video from Robert Prechter, about the current historic extremes.
‘Not since the South Sea Bubble of the 1700s’
Couple all of that with bonds (TLT) breaking down and we could have that ‘inflection point’, saying we’ve reached the top (not advice, not a recommendation).
The Mania Goes ‘Manic’
Going back to this post, it said to expect the AI proaganda to increase as we reach the top and reverse down.
If yesterday was that day, then we’ve got more articles coming about the downside being a ‘buying opportunity’.
It’s been the same throughout history
From a positioning standpoint and Wyckoff analysis perspective, under such conditions, one is to pick the weakest market to short and not the strongest (not advice, not a recommendation).
Junior Gold Miners, GDXJ, Bear Market
The last update showed how positions can be de-risked.
There’s always uncertainty but working long enough in the markets and eventually an understanding is formed on how the game is played.
Fake, fabricated or ‘serendipitous’ news articles getting the public on the wrong side, are just part of the game.
In the early session, the GDXJ, is continuing its move lower.
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.
A military coup in Niger results in gold shipment suspension.
Correspondingly, the mining sector along with gold and silver, are higher.
The real question is, will gold, silver, and the miners continue upward or is this just an excuse to force out the weak (short-positioned) hands?
If we look at the facts, such as Niger’s gold output compared to the rest of the world, it’s miniscule; hardly a blip and production is decreasing.
Add in, the mining sector has not been in a bull market for years, and we’ll surmise, the current move higher has low probability of continuing (not advice, not a recommendation).
For today’s session (as of 3:11 p.m., EST), price action has effectively been slammed into resistance as shown.
Junior Gold Miners GDXJ, Daily
For positioning short (via JDST) this is potentially a low-risk area (not advice, not a recommendation).
There would need to be continued demand for a move higher past the resistance area (blue line).
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.
From a strategic standpoint, this past Friday was the end of the Quarter and possibly the lowest risk spot to short the semis (not advice, not a recommendation).
‘Low risk’, does not mean, ‘no risk’.
We’ll look at the chart below for the SOXX, but first some housekeeping on the Junior Miners, GDXJ.
As stated in the last update, if there was more GDXJ, upside, shorts (via JDST) would be exited. That’s what happened with an overall gain of + 3.57%, on the series (beginning 6/16/23).
Now, on to the next circus … Artificial Intelligence; more specifically, NVDA and its cohort, the SOXX.
Where’s The Money?
With the quarter over, money managers have dutifully shown they’re like everyone else, ‘investing’ in AI.
That’s out of the way, so let’s move on to the specifics:
Referring back to the excellent investigation done by The Maverick, in his view, the $11 Billion, is “Fantasy”.
The tricky part from a chart standpoint, is to identify when or if that fantasy is going to be exposed.
Semiconductor SOXX, Weekly (Inverted)
We’ve taken the weekly chart of SOXX, and inverted it as if going long the leveraged inverse SOXS (not advice, not a recommendation).
Downside force dissipating with each major thrust.
Last week was an ‘inside week’; price action could not make a new weekly low.
Couple that with end of quarter, potential ‘window dressing’ and this past Friday, may have been the lowest risk point, for shorting via SOXS (not advice, not a recommendation).
Analysis … not Advice
This site cannot and will not give advice.
What it can do, is provide analysis and strategy so that you can make your own determination on the market.
With that said, the ‘heads-up’ for a top in the SOXX, was posted on June 17th, link here.
Since that time, the SOXX reversed down and has now come back to test.
Positioning
On Friday, the SOXX, was shorted by entering long the inverse fund SOXS, at 10.01.
Soft stop (trader discretion) for the position is the session low at 9.75, and hard stop (no excuses exit) at all-time low of 9.48 (not advice, not a recommendation).
The coming weeks may prove interesting. All eyes will be on that ‘$11-Billion’.
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® 