108 thoughts on “CHART OF THE DAY – CHANNEL BREAKOUT

  1. bluelagoon

    TQQQ – charts seem to call for a correction coming – I can’t see it getting past 107/108 without one.

    Looking at USL – seems like it hosted a DCL on Summer Solstice – June 21st (could that have also been and ICL?). And then this past Monday a half cycle low? I am looking to get into UWT for a target to $13.25.

      1. bluelagoon

        I agree with you that the SM is bullish and heading up. When I say correction – I just mean a better entry price than where we’re at today. It may or may not happen but that is what I see.

  2. Gary Post author

    And the deflationists still see a recession coming. Of course they’ve been waiting for the next one for the last 8 years.

    Recessions don’t just occur for no reason. They begin when inflation surges too high causing the economy to grind to a halt. Since the 1940’s that means a spike in oil prices. A sudden sharp spoke higher in oil has preceded every recession since the 40’s. Before that it was wheat. When the price of wheat rose too far to fast it caused a recession.

    Clearly we don’t have high energy prices right now, so no recession in the near future.

      1. Bluebellkid

        I’m buying AAOI based upon fundamentals. The stock just went thru a consolidation and formed a cup shaped base. The right side of the base is forming this week as in one week which is not ideal but it is what is as. The stock has repeatedly found support around the 50 day which is a sign of institutional buying. Fund ownership was 137 in the Sept. qtr. and is now 243 so funds like it. The stock is in new high territory and the RS rating/line is also in new high ground confirming the breakout.

  3. zkotpen

    Mustang Sally,

    Thank you for posting your thoughts on currencies. I really wish you had just done so to begin with, instead of attacking my extremely hard work, which I even hesitated to share.

    Currencies — and that includes gold as far as I am concerned — are in a multi-year consolidation pattern. The question is: When will that multi-year consolidation end? I probably think it will last longer than anybody I’m aware of. I think we’re nearing the middle of it; you seem to think we’re nearing the end of it. So we agree on what we think is gonna happen, but maybe not on when.

    And HUGE thank you for making me realize just why I hate debate:

    In attacking the other person’s position, you risk failing to see the merit in it.

    I recommend you go back and read my post looking for merit, and not for flaw.

    It is quite revealing — which is why I hesitated to post it.

    1. zkotpen

      I managed to make a profit on my short EURJPY position — first ever forex trade.

      Didn’t quite catch the exact bottom — I saw that mini-double bottom on the 3 minute chart and decided to take profit. Fumbling around with meta trader caused me to miss like 0.35 yen (from the moment I began closing my trade).

      But still profitable, despite all my execution mistakes, which I will get right to work correcting.

    2. mustang sally

      Zpen: I have no doubt you have worked hard on your system, I am not here to learn other theories and system. so don’t be insulted, you have yours and I have mine.

      Regarding currencies I do not call it a consolidation I call it a correction or reset, when my markers are all hit it will begin , and it will be the most viiolent correction not just one but many and it will be the worst we have seen, even worse than 1929.

      Mustang Sally

  4. Ed

    Seriously, Gary.
    What PPT does is not to drive stock market to top.
    I bet you that PPT is quite happy with current stock market. Not too hot but just warm enough to put bunch of people like you to sleep forever dreaming NASDAQ hitting 10,000. LOL

  5. Spanky

    PPT doesn’t even need to intervene at this point. Market participants will drive the bubble phase. The Fed has created a positive feedback loop with its explicit backing of asset prices. Why the hell shouldn’t you go long??? The only risk is currency risk, but the Fed BOJ and ECB can keep that farce going for a long long time by their collusion.

  6. Spanky

    GDX getting ready to waterfall. Yesterday’s reversal was probably the top. Should correspond to a surge higher in usdjpy and the stock market

    1. Christian

      I was holding NUGT but just got out at breakeven. Yesterday’s move UP in Gold might’ve been a ‘bull trap’ and I don’t wanna get stuck trading against the prevalent trend which is DOWN.

      I still think Gold is due for a bounce but who am I to argue 🙂 Sitting on the sidelines for now.

      1. AT

        I’m back in JNUG at 16.08 for 50%

        Jul 13 buy 50% JNUG 16.08
        Jul 11 sold 100% JNUG 16.56
        Jul 7 buy 50% JNUG 15.03
        Jul 6 buy 50% JNUG 16.46
        Jun 30 sell 50% DUST 31.48
        Jun 27 buy 50% DUST 30.05

          1. Nada

            Afternoon AT. Yes, it may have been the ICL. I am not so sure though. To me it looks like gold wants another 40 points or so lower. However, I am certainly open to the possibility of it going higher. I am currently short and if gold closes above 10ema or if 4h chart holds over that level I will close. I don’t like gold hanging around this level for bear case.

          2. Christian

            AT — Why are you so convinced that the ICL is already in place? D’you have anything to back up your perspective..? Just curious Thx 🙂

          3. Gary Post author

            It has met one requirement but that doesn’t guarantee that the final ICL has been printed. There could still be another daily cycle to play out.

          4. Christian

            + keep in mind — We haven’t seen the kind of sentiment extreme that we would normally encounter at an ICL.

  7. mustang sally

    Good Morning Cowboys/giris

    Zpen has asked me to comment on currencies going forward. Zpen I use a system which visualize .\identifies markers on a chart, I use these to determine verify direction, If you go back I have posted several markers which indicate to me where we are going, If my markers are fulfilled you will probably see the swiss currency around 85 in a short period of time.

    MS

    1. Gary Post author

      Just a small position in case this turns out to be a DCL.

      The easy money is in the stock market. That’s where I have all my personal investments.

  8. dboz

    Stopped out of USLV at 10.10. Still holding UWT and UGAZ. No more miners or metals in my holdings right now. I guess it’s possible it could explode up from here but sure lacks juice it seems.

    Oil is a total grind.

    I have a tight stop on UGAZ as I am up and don’t want to go into the hole as it also could just collapse back down to the lows again. THAT is when I will load up for a possible run up into the 4 range. If not, still plenty of time to reload. Over 3.05 is the trigger to add from here though.

    I have made 2 trades in the contest so far. Have not figured out how I am doing yet. I think I am up a little but not killing it like those on DUST/JDST.

    Did I see Gary say we can use stops? Guess if it hits your price during the day he rings you up? Not sure how that is working for the contest?

    1. Gary Post author

      If you get stopped out on an entry the same day that’s fine.

      But no more of this day trading. In and out in a single day. I don’t have time to track that many trades.

      It’s hard enough as it is. Virtually everyone in the challenge is constantly jumping in and out of the market. If they close a trade they immediately take another. Classic retail trader behavior.

      1. Nada

        When can we expect our first release of the standings? I am more interested in who is actually “in” the contest, lol. I do find one thing interesting – since the commencement of the content, the big claims on making this and that had slowed to a trickle!

        It will be interesting to see if those same folks are actually in the contest and how they are trading. GL

  9. WYSIWYGN

    Gary, you’re rather optimistic about the SM’s, in how far does this mirror the broad complacency that typifies a nearing crash ? (sorry for my not native English, but you understand what I mean)

    1. Gary Post author

      We aren’t even remotely close to the kind of complacency that signaled the last two market tops.

      You need to quit listening to the perma bears that have been trying to call a top for 8 years.

  10. Christian

    Careful — Gold is trading below its 10 DMA and could make it very confusing for everyone over the next day or two. I’m currently getting mixed signals on my charts.

    Ps: The EUR/USD is showing negative divergence on the day chart which could signal DOLLAR strength and ultimately put pressure on Gold.

  11. dboz

    Yeah, I have a feeling there is a lot of capitulation on the brink. Frustration, sideways, goes up and stalls, regresses and just sits there. Days on end it seems. Tough to be patient when so many other sectors are hot. Still sitting and waiting but at the present, glad to be metal/miner free. Disappointed I could not hold my USLV any longer. No sense to go down the toilet after a big gain.

    1. dboz

      Parted ways with JNUG and NUGT yesterday on the opening boom.

      Oil is a grind also. Big shake out swings, slow grind up then plummets.

      Starting to think I need to follow Gary into the NASDAQ. Just so hard for my brain to buy at ATH, of course they could be super cheap according to Gary.

  12. Goild

    I am waiting for a flight.
    Hate to be away from my trading station.
    Sold 4K uso shares for a good profit.
    iPhone trading is not easy.
    I will be drinking to your health.
    Make money!

  13. dboz

    If miners and metals do not catch a bid soon, capitulation is going to occur and it is going to be really ugly. Seeing many people throwing in the towel and selling out. I can’t say I blame them, a bull market has to have some way to make money, all people do in this bull market is lose. If you don’t time it just right and catch the bottoms of a swing, you WILL lose your money. Not really bull market action. No building to higher highs, just a few up weeks then a few down months, rinse repeat. It is beyond brutal. To think we are ever going to have the juice to even power above 1300 at this point is ridiculous. To test ATH would take a miracle.

    JNUG has traded the bulk of the year in the 4-7 range (split adjusted from the most recent split when people were buying). Decay and lack of any upside has you down over 600% from last September before the crash out.

    The only people who have made money in miners are the day traders and the swing traders. No BUY AND HOLD strategy could have possibly made you money UNLESS you bought in Dec. of 2015.

    Pretty much looking at the bear returning. Gary says OIL/ENERGY creates recession. They also create inflation. Both are in the toilet. Stock market is poised to blow out, says Gary. Real yields are going up. Just no case to be made for a bull market in metals.

    Still ready to pounce if it looks ripe for a quickie, but so far its just been fools gold to chase any upside as it always collapses back to lower than you bought.

      1. dboz

        Cleaned up this week. Big gainers on USLV, JNUG, NUGT, UGAZ, UWT. Sold out of all but UWT. Took profits for once instead of riding back down on hope or FOMO. At least a 12k week.

    1. Nada

      We are getting closer, but that last statement of “Still ready to pounce if it looks ripe for a quickie” tells me we need another 40-60 point drop for the ICL is in 🙂

    1. Nada

      Just checked sentiment on sentimentrader.com;

      Gold Optix 1y is 44 today.
      Gold Optix last ICL in December reached 36.

      So sentiment is close to neutral, so yeah she could easily drop that much. GL

  14. Spanky

    Large gap down in the metals and miners tomorrow is my guess. Today’s close in slv and gdx was basically at the lows of the day.

    August looks like it will contain the ICL. Then a bounce and who knows.

      1. Nada

        Yes you cannot dismiss that possibility. We know nothing is a certainty in the markets. It’s sort of a dangerous spot to be short or long. GL

  15. Christian

    DUST — This (below) would normally trigger a ‘buy’ signal in my books but I just didn’t have the cojones to do it because I really think that Gold is due for a bounce out of a DCL. Of course I could be wrong and Gold could just continue to trickle down into an ICL, which I think is due in August.

    Aug/Sep/Oct are the best month for Gold. January is normally pretty good as well 🙂

    https://www.tradingview.com/x/aw7HE1NB/

  16. zkotpen

    Goild,

    Bon voyage, mate! Good for you.

    I’m even paying close attention to your comment about trading on a telephone. I already call most photography I see on those things, “pHoTography minus HT”.

    I have never owned a smartphone but am finally on the verge. Tablets make more sense for viewing my favorite graphs: Charts & Photographs. Maybe prioritize a tablet instead.

    One suggestion:

    “Create new thinking.”

    So you’re on vacation? When I see a tourist with injuries in SE Asia, I just point and ask: “Motorbike?” The answer has always been yes.

    Only, don’t ride the moto-byke. Just get that sling to immobilize your right arm for a few days. 😉

    A few months ago, I took my first dip in the Indian Ocean, and the ocean offered me a gift: A piece of coral. I just picked it up, and the coral went home with its human. A few hours later, my rational mind realized, it fits perfectly in my left hand. The white coral looks like an island on the black desk, floating in an archipelago along with such islands as computer, mouse-on-pad, USB drive, sunglasses, and water bottle.

    I pick it up from time to time and squeeze in my left hand.

    Kinda like a souvenir.

    Safe travels, m8 😉

  17. zkotpen

    Christian,

    So my first forex trade (times are UTC):

    2017.07.12 17:45:34 sell 0.01 eurjpypro 129.333
    0.000 0.000 2017.07.13 11:15:28 128.882

    Not posted in real time, but it is so badly executed, I’m sure nobody will doubt its veracity.

    Even so, if you look at it, with timing, you can see my thinking was correct for trading a wiggle. Even though most of the intraday move was over from the Yen’s DCL (vs. both dollar and Euro), it still looked incomplete, with very high probability. Controlled risk by small position size — couldda traded on a demo account, but just start small with real money, gain forex trading experience, correct errors of execution, improve strategy, and increase position size as results warrant.

  18. zkotpen

    Gary, Christian,

    Thanks for encouraging me into finally trading forex!

    I don’t believe forex is eligible for the contest, but that is the trade that my charts indicated I needed to make. May or may not be able to expand my attention into the relevant ETFs — perhaps even with NUGT/DUST or UGLD/3x short gold. But, you know, it ain’t time for those guys… yet… (much to the chagrin of the impatient!)

  19. zkotpen

    Folks,

    If you’re looking at the dollar index — which is not just Euro-heavy, but European-heavy, vs. USD, that’s not what’s going on at present.

    JPY is dying to go down. And since this is a down year in the dollar, that means you pick your preferred European currency, and play it against JPY — both up and down.

  20. Steffmeister

    Do we have “the turn” already? My work, if it works is based upon a gold index and a miner. 17th is the date or a day later perhaps …

  21. Ed

    Choice is yours. which chart do you believe? If you are Gary or his way of market followers you want this chart to be hold true. expecting the dollar to rise 120s 130s 200s… 🙂
    Monthly Dollar Index chart, https://invst.ly/4d7-y

    If you are like me you want this weekly chart to be hold true.
    https://invst.ly/4d822
    I am expecting the dollar to fall to 80 level.

    But this is only a half of story. The other half is about Central Banks “Neo-Ponzi” scheme.
    That’s for another day.

  22. Ed

    Gary, so how do you reconcile PE? S&P now has 25, you really think it can go up to 100?. Stocks are already a big fat bubble. When Dollar tanks Bond yields sky rocket. The money will come out of richly priced stocks to attractive earning power of bonds. Gold is just a different animal.
    Current bond holders get screwed but future bond holders will enjoy earning power much greater than stocks. STOCKS ARE SCREWED.

    1. Gary Post author

      I don’t think you understand how bubbles work…

      PE’s during the last bubble went above 40.

      Valuations during the housing bubble were insane.

      Bubbles are about emotions, low interest rates, & too much money chasing an asset. Bubbles occur when the public starts to pile in. That clearly hasn’t happened yet in the stock market. We aren’t even remotely close to the kind of complacency that marked the last two market tops.

  23. mustang sally

    Hey there
    It appears my markers are acting the right way and the cross will be devastating, sorry Gary deflation ,

    Here is another worth watching Nem at 29.89

    Dusty is trying to get rid of everyone if the markers are right,

    MS

      1. Nada

        Morning MS. Let’s see how we close, but at the moment xauusd is reclaiming the 200dma. I doubt the ICL is complete, but it appears we have a new DC. This is why it’s important to take profits quickly in PMs. I believe you have DUST at 29.xx, correct?

        1. mustang sally

          Morning to you Nada.

          Yes I have my dust at 29.30, I would be buying jdst right at the open, but I am maxed at my bingo game. Regarding profits I am not a trader, I wait for a major trend and ride it. There is nothing in my mind that would change my view right now on the situation. When my markers confirm I would bet my the whole enchilada;s on jdst.

          I am going to win big or come out at 0. let the dice roll.

          Regarding zpen, just anther poster to interact with, you got to remember in the home it is dam boring and these boards give me life.

          Mustang Sally

          Rollin with punches

      2. Nada

        BTW, whatever you do Mustang Sally, please do not address zkotpen. He spoke for days and generated about 10 new posts due to your previous comments :p

  24. Gary Post author

    And this is why I warned Sally not to start gloating just yet.

    I warned subs that the dollar wasn’t acting like a final ICL had been printed yet. If it has another leg down that could drive gold out of a DCL. That’s why we took profits on our DUST trade and entered a modest NUGT trade.

    1. mustang sally

      Gary: I would be buying jdst like a mad hatter right now, this is just a collection program going on right now.

      Let er rip

      Mustang Sally

  25. Gary Post author

    I’ll give everyone a hint for when to look for a possible top in the gold rally. Note where the 38% Fib retracement is on the dollar chart of the entire three year cycle from the low in May 2014 to the top last December.

    1. bluelagoon

      That would be around $95 right? I’m not sure I’m convinced of an ongoing correlation between the USD and gold….the relationship changes and one is not always a good predictor of the other IMHO.

  26. Don

    The Canadian dollar has been exceptionally strong. That is hurting our resources sectors since they get paid in US dollars for oil, gold, etc. It would be OK crude was selling at a decent price but that is not the case. At 47 dollars, a lot of Canadian crude is not profitable.

  27. Goild

    Good morning guys,
    Sold the 4K balance of USO shares.
    Oil is still cheap and July I hear is a good month for oil.
    Though I hope we have a double top to go down again.

    I will drink a Margarita with best whishes for you to make big bucks.

    Zkot, thanks for your comments.

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