44 thoughts on “Nasdaq breakout

  1. Robert

    Gary, you still feel gold DCL will be left translated? You think little more upside left in miners? Getting nervous here think I bought too high today

    1. Gary Post author

      I don’t have any feel at the moment whether gold is going to produce a left translated cycle or whether this was some kind of weird short ICL.

  2. Don

    I can see gold going to 10000 but it will be physical gold, not paper or phoney Comex contracts. There just isn’t enough physical gold around if enough people wanted the real thing instead of playing around with ETFs.

  3. Goild

    So I see the charts for gold/miners and they look bullish.

    Is this a good time to get in?
    Or a time to be patient and wait?

    Tulip, can you give us your take?
    Any one else?

    1. MagnuM

      I added to my miners in the morning. Although the miner charts are confusing, I like how gold & silver both put in (slightly) higher lows on their pullback.

      Pedestrian could be right that gold is just forming a right shoulder, but you can still make money on the long end of that pattern if you know when to get out.

  4. Goild

    MagnumM

    Yes, I see the possibility of a right shoulder.
    Add to that the Euro is about to complete perhaps a double top.

    Tomorrow, there may be a little retracement to hit the daily averages.
    Over the long term it seems that gold/miners are currently a bargain.
    Perhaps a key chart is to compare XAU with GLD in a double axis, 2 year chart.
    My take is that in this chart the miners XAU converge to GLD.
    So currently the miners are a little above GLD and so I would expect them to hit GLD soon.

  5. zkotpen

    Here is how a bull or bear trap — wave B or X — works:

    You fall in love with your long or short BELIEF. And since it’s a belief, you just act like you do with every single other belief you’ve got — you are ready to, in this case financially, live or die for your belief.

    You see 5 waves up or down on your chart, respectively, followed by a 3 wave correction. You tell yourself, I BELIEVE that’s wave 1 & 2. Then comes this big ol’ 3rd wave, with a little pullback or bounce, respectively. You say, oh, that’s just wave 4. I can’t wait to get in on wave 5. I’ll just start building a long or short position, respectively, at the 23.6% fibonacci, add to it at 38.2%, & sit back & wait for blast off or tanking, respectively.

    But wave 5 never comes. The alleged waves 1 & 3 in your impulsive wave count were actually waves A and C of the wave B or X at one degree higher. And just imagine if wave B or X is actually part of an irregular flat or running triangle — the overshoot high or undercut low, respectively, has you all giddy — you’re making your big shopping list, perhaps even already spending your massive profits, when the market reverses and the trend one degree higher resumes.

  6. zkotpen

    I recall so many people on the SMT premium site singing “Oh happy day!” at the tops of their voices on September 18, 2013.

    I was sitting at my desk in Copan Ruinas at the time, shaking my head, quietly posting:

    “Looks like B”

  7. Pedestrian

    TVIX was split 1 for 10 yesterday. Anyone looking at the huge jump in price should just be aware it was not a big buy but rather just a reverse split so ignore the 5 million shares volume as its not meaningful to trading. Just thought I would make mention in case anyone got confused by that huge price jump you will see this morning.

      1. Pedestrian

        I didn’t. Nothing to report. So either its a one sided trade or the inverse money was put elsewhere. Anyway, I have never seen anything like that before and I watch pre-market and post market every day. Sure, there are big trades but this is weird because afterwards there were efforts to erase it like it never happened.

  8. ARends

    Goild that is putting a great plan of action!

    We all want to make money how ever we can cutain the risk in short and meduim term with risk management in different POV. We all here to make money and can respect each POV, ander other cant which we can ignore. We all look at it from a different angle and diverse experience pooled, can make a better play. However there is two mindsets daily and long term with in Bull and bear POV.

    Yes, I also feel at times confident but then it gets hammered by opinions and become counter-productive and do not enter like last move. If the objective of each POV is looked at as an added value, rather it could become more constructive. I have learnt a lot from others here which I appreciate.

    I must say it does seem lately moving more in that direction, and I thank those with years of experience sharing their trade even while we not all on the same page.

    We at a pivital point of gold. I have many gold miners in trade and trying to use % for ETF miners for short and meduim term and got mailed with the correction play size was the problem but a good run up with a good load is possibly each ones aim. Goild made it clear the trade size messes w your mind in the hold, after a huge drawdown. All of a sudden I just lost my nerve although for me there is enough to know we in a bull and convinced in al techinical I have seen. The meduim term noise is just killing me with this pivital point.

    The contrast here in getting in at the bottom and confirmation of the vove direction, where I have failed id intry and excit strategy with a system meduim longterm not using stops.

    I yesterday got a 1000 Jnug with Goild to build again on ETF as it seems that resistance is holding and possibly drawdown should be less in my view on a possible continuation if that was a bottom. Ew others wave trader see a little up and down before major move up. Is that draw down for lower prices going to come looking at Gary cycle and this being the bottom. Looking at the penant formed that must be moving up.

    Do load more? Know? I really looks today might beanother blow off!

  9. ARends

    Gary, Kzot, Pad, Goild here is a very interesting short video indicating medium and long term increase accumulation of COT as seen in past that indicate the bullishness forward. This is contrary to POV of other analyst, possibly for a reason.

    I think he has a good point. However would this not be the case of all markets with the accumulation of reserve funds, possibly in long run with QE, but meduim term seems relevant. What is your POV of the theory he supports?
    https://www.youtube.com/watch?v=mwkcQzyK7gE&feature=push-u&attr_tag=2dIG974aPU_6fYK3-6

    1. Pedestrian

      Pop up to 1236 definitely possible and I am entertaining that idea this morning. Even 1250 is not out of the realm of possibility but then I agree we would see the decline continue after that. Morton may be on to something.

  10. Pedestrian

    Just a heads up. Today is Quad Witching day which comes on the 3rd Friday of each quarter when options expire or are rolled over. It can sometimes be chaotic and depending on what you own you can inexplicably see your stops run. Generally its bullish for markets too so today could see indices in the green with gold dropping (not a prediction, just a guess at this point). Anyway, late in the day can screw with your trades either direction so its just a good idea to understand why its happening, not necessarily a reason to do anything about it.

  11. ARends

    Looking at XAUUSD & GDXJ as superimposed graphs over each, I see in the bull from Dec 2016 GDXJ lagged. From the middle of the wave up to the peak, GDXJ extended beyond gold % increase ingrowth. From the peak down again we see GDXJ lagged from 50 fib. Looking that they equite at the 50% fib.
    Considering with those positions it is clear that GDXJ has stretched up leading gold. After the huge correction it excellerated far beyond. So if gold is going to make a short futher jump up follow suite ir wait for catch up which seems as GDXJ nature keeping in a price range more with its pattern. Price has clearly crossed a fib and resistance to possibly move in a band to either stay for the Gold move to 1236 and back down before continuing. Looking at the caracter of graph might give us hint whats next in miners

    https://invst.ly/3gt8n
    https://invst.ly/3gthk

    1. ARends

      The point at this stage is that we see GDXJ is far ahead of gold over the past year period in the bull POV and could drop or waiting in a band for Gold to make noise before retracing back to the bull.

  12. Pedestrian

    So why should gold buyers care about Quad Witching?

    Well for a change I am not going to tell you because its far better for you to read the chart and understand for yourself. So I linked a daily gold chart below. The third Fridays of March, June, September and December are what you need to focus on. More precisely, its what happened to golds price in the three months leading up to each quarterly options expiry and then what happens to it afterwards.

    You probably won’t be able to pick out the Fridays on the chart so for simplicity just imagine the last week of each month as a visual guideline. If I tell you that the direction changes at each juncture then you might all start accusing me of a bearish bias. Therefore I won’t say that. You can figure this out for yourselves.

    And good luck in your trading!
    http://finviz.com/futures_charts.ashx?t=GC&p=d1

    1. dboz

      Bearish bias for sure because if you look at the next week following those periods you mention, you see a significant increase evertime. Makes me wonder if I should sell it all this AM and wait until next Friday you buy back in. That looks to be fairly reliable.

      1. Pedestrian

        Thanks for looking guys. This is definitely a time to keep your eyes peeled. All that you need to know is that the trending direction can change. This idea is neither bullish nor bearish. Just different. So during the first quarter 2017 gold has been on the rise from its low in December 2016 (right after options expiry).

        The suggestion here is that gold could (no guarantees here) fall for the next quarter. Last March prices basically hit bottom during expiry week and then gold roared to life in April which was followed up by a another huge leap at the June expiration. I don’t think 2017 will mirror 2016 though.

        Basically the market has got to get you on the wrong side of the trade. For example, the big rise on FOMC day might have gotten more than a few people fueled up and buying calls in anticipation of a great payday.

        I happen to think they are going to be very disappointed.

  13. dboz

    Fundamentals may no longer matter but where does all this gold keep coming from? Mining companies have all but abandoned exploration. Gold production has peaked. All it’s going to take is for the a Trump admin to come out and tell Americans they should probably own some gold. Just watch EBay sales to see gold buying ramp up. How can price be driven down when demand goes up? I know the paper manipulation answer but at some point that game is up when physical delivery is demanded vs. paper money settlement. It may not happen soon or maybe never, but at some point it could.

    http://investmentresearchdynamics.com/indian-gold-imports-in-february-tripled/

  14. dboz

    The short side has been the easy side, Ped. Way more down than up. Cot shorts still loaded near all time highs. Few bulls left in the sector. Massive shorts on most miner stocks. The max pain is up and up rapidly to catch shorts and squeeze price up.

    1. Pedestrian

      Boss, there are two sides to the COT’s

      On the one side you have speculative interest, hedge funds and large traders (called dumb money). And on the other side of the ledger you have the Commercials who take the opposing side of the trade (smart money).

      In the case of silver for example, the speculative long positioning is at an all time record high (historical high). Naturally enough the Commercials are taking the other bet with offsetting shorts. Typically these kinds of extremes are resolved by the underlying product (silver in this case) falling in price and eventually rewarding the Comm’s who just bide their time until Mama comes to call.

      Speculators in general don’t usually win the war although they get many battles correct. So you need to be concerned by big extremes in positioning when trading because those can lead to dramatic outcomes you probably did not plan on.

      The silver charts are not bullish (to me anyway) and so I am taking short side bets that should have a happy ending. The reason I mention silver here is because its easier to read than gold and the end result looks more obvious. But where silver goes gold tends to follow. We don’t often see a big correlation break between the two metals with one going South and the other North for very long.

      Take a look at the COT’s on the bottom of this 25 year silver chart. Note green and red lines. See the extremes we are at today? This is not a timing chart though and you can’t know when exactly price will break to the downside and resolve the differences. But it WILL happen. Rest assured of that.

      And just for fun take note of the fact that Commercials are almost ALWAYS net short betting against speculators and large trades because metals heads are just so damned in love with that trade!. So yeah, they will virtually always be on the other side.

      http://finviz.com/futures_charts.ashx?t=SI&p=m1

      1. ARends

        Have you ever looked at the BLEES formulation with COT and use it at bottoms

        Formula for counting the blees number: 
        Commercial shorts-commercial longs= X 
        X-last 2 years minimum X number=Y 
        Last 2 years maximum X- Last 2 years minimum X =Z 
        Blees= Y/Z*100

        Blees rating predicting a decline is 0-40
        Blees rating predicting 71-100 is rally

        Blees rating predicting Direction change 50-70

  15. ARends

    Ped,
    Quad Witching
    I looked and tried to see if we have a difference in the bull period to the bear period in the year. I have noticed the day close and open have fraction of previous days in 90% cases . It did not prevent price movement. Up or down to previous day in bull or bear did not seem to have much correlation.

    1. ARends

      I must clarify that in the bull period it was a factional difference in open and close of price , but not just to the previous day by it being a long candle, but not in the bear period the day before was also fractional and short as the previous in the bear till now except one month.

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