109 thoughts on “CHART OF THE DAY – NOT PARABOLIC YET

  1. Gary Post author

    The market is pricing in a tax cut. If it were to happen quickly the market would go nuts and could get to 10,000 very quickly. If it takes 4-6 months then we’ll probably continue to grind higher and then get a sell the news type of reaction once it becomes official.

  2. Gary Post author

    Energy seems to be universally hated, but if you step back and look at the big picture, energy stocks have just retraced a completed normal 50% after the huge run out of the 3 year cycle low.

    1. Duuuuuude

      I think if you traded oil instead of energy your methodology would work out just fine. I use the same tools I learned from you trading crude and gas and have made a lot of money this year.

    2. ras

      Incorrect. Its time will come. For now, it is a laggard. One can still buy and hold for long term, the best of energy stocks, if one so desires. As you say, the place to be is nas, that is where the action is. Nice chart, Gary.

      Labu is sluggish. soxl nudging the century mark powered by leading semi stocks. The real fun will start as we get close to early August. tqqq acting very well. Enjoy the nas ride while it lasts.

    1. Bigdaddy

      I don’t think zkotpen is an ahole but there is clearly something wrong with that fella. He says things that make no sense at all. Maybe English is not his native tongue ? I am not going to bother reading his stuff anymore as it takes too much time and it’s just a waste of time anyway. I need to spend that time studying the markets. Buy silver guys.

      1. Christian

        Z is a heck of a lot more pleasant than some of the other A**holes that occasionally like to make an appearance on this blog — Just remember that big fella 🙂

    2. vin

      Robert, I stopped reading him long time ago. It is one thing that he makes no sense with his infinite wisdom! it is another thing that his ego knows no bounds. A few months ago I ran into a discussion with him. And, that was something else. I suggest that Gary should block him out.

    1. Nada

      Wait until the SPX breaks out of the megaphone pattern BD. Huge money flew into this market with Trump being elected, great things to come. #MAGA

      1. Nada

        Even the snowflakes love Trump deep down – each and every time they check their 401k. Yes, he certainly could get much higher approval ratings if he stayed off twitter. Guess what? He doesn’t give a rats ass about approval ratings.

  3. Don

    Are sure sign that we are approaching a peak in market insanity is when a company such as Netflix earns a meager 15 cents per share and the stock goes up 13% in a single day, dragging the entire SM up to new highs as investors become giddy with exuberance.

    1. bluelagoon

      Longer term picture looks like oil has completed its ICL and is heading up. Shorter term picture, oil should correct as it’s at resistance and MA’s need to line up. Hopefully it’s not stuck in a channel for a while.

  4. Christian

    DBOZ — Not sure why you decided to pick on me this morning but I’ve been pretty transparent with all of my trades including the ones that didn’t work out. I don’t trade everyday like all the cowboys on this blog and I don’t need (nor do I give a damn) to be in a contest to prove anything to anyone.

    Right now, I’m sitting on the sidelines waiting to get back into DUST and energy. I already have money in Stocks and Real estate which I don’t need to share with this blog.

    Is that good enough for you bud?!

    This blog was doing so well folks and suddenly people are turning into Dicks again! Calm down and focus on your trading 🙂

    1. dboz

      Not picking on you. Just made an observation.

      That said, I got roasted today being short WTI. Whoa, big break out move on draw downs. Probably heading over $50 now.

      Going to give my DGAZ a little wiggle room yet, but that is looking bad now also.

    1. Christian

      I have several but in short I’m waiting for Gold DC to fizzle. And I’m also keeping a close watch on the Dollar and the Euro.

      Right now Gold is consolidating under the 50DMA and a subsequent move up to 1250/55 is likely in the coming days. After that.. a sharp intraday reversal to mark the top maybe? Divergence? A double top..? Not sure just yet.

      Notice how the move up in Miners has been ANEMIC while Gold has been ripping it up over the last couple of days — that’s a sign of weakness in my books and Miners are looking at another Ass kicking!

  5. dboz

    I have said for the better part of 9 months now, they have killed off the mining sector to any sort of NON BUG investors. Two or three ass rapes down and people say enough and move on. Why fight it. I have been so much better off giving up on the big multi hundred percent gains again. It is obvious that is not going to happen any time soon. The volume and money are gone. It got hot the beginning of 2016 then the shake out, then the crash, then the second shake out and now just bottom feeders and stubborn BUGS are left. Not saying there won’t be rallies. But to think somehow we get back the momentum like we had rolling into the fall and the election when they eviscerated the sector, won’t be back any time soon. No one believes gold is going up and NOW you have the CRYPTOS scorching hot. That is getting the gold and silver and miner money.

    1. roadrunner

      the crypto currencies may be getting the miner money, but gold is still being bought by central banks. they don’t buy crypto’s. As well India imported 220 tons of gold in May. The miners will go up when gold breaks out of the long consolidation. be patient with the miners..ie..accumulate for longer term or play in another sector till things start moving. otherwise your frustration will continue.

    2. Americano

      Wait till next year!
      This show doesn’t even start till 2018.
      I left PM for good late Feb after JNUG nonsense. All in BITCOIN ( because only asset not PTB manipulated & deflationary with 21 million cap) but for 401k.
      I still keep my physical silver from years back though & I still keep a landline phone LOL.

    1. Gary Post author

      I’m waiting to see if the dollar finds a bottom on the 38% Fib retracement (94.30).

      If it slices through and keeps heading lower then gold has probably bottomed. If it bounces for 4-8 weeks then gold probably still has to test the lower triangle trend line.

      If I had some idea what the currencies were going to do I could pick a direction in gold, but currencies no longer respond to cycle or sentiment forces. They are the playground of central banks as the currency wars continue.

      1. Americano

        Can you hold love in your hand?
        You can hold your paper wallet in your hand it is the key to your Bitcoin without which – it can’t exist.
        Can’t be hacked – completely physical.
        For all the what if the internet shuts off – it would have to happen globally not regionally & when it turns back on all is well.
        What if the internet goes off types should worry more about the rapture then the internet going off lol.

    1. roadrunner

      the article says crypto currencies replacing gold….for younger investors. i doubt all those younger investors would move the price of gold significantly.

      1. Americano

        Well yeah obviously but us old guys are going because its deflationary & will not only seal wealth but actually grow. What does gold have to look forward to next year best case scenario? $1450-1500 lol?
        I’m up 120% large since March & this thing doesn’t even start till 2018.
        Early days. Just posting because metals folks are good people – but they are just overlooking this right now. Gonna be real obvious next year

        1. Nada

          @Americano What do you trade – bitcoin, ethereum or litecoin? If you don’t mind, can you cover some of the ETF’s you trade and do you play equities or derivatives? The movement in metals have become quite boring 😛

        2. KHT

          Well, forgive this old man for wondering. It is my understanding that the run up in crypto lately is due to India and China citizens looking to move their wealth out of the country. China citizens, the wealthy ones, have been running up Canadian real estate to outlandish prices (BUBBLE) to put their wealth anywhere but where it is now, GOLD which is held in China, since it is almost impossible to move it out of the country.

          So gold is considered a safe haven of wealth from paper fiat but now crypto is now the go to safe haven from gold.

          Yes, i can hold gold in my hand, it is heavy, I can hold paper reserve notes in my hand, I can not hold any crypto electrons in my hand and any government at any time can hit the internet kill switch and wipe out any crypto ‘wealth” in an instant.

          Meanwhile back at the ranch, I will still have my stash of paper reserve notes and gold/silver bullion.

          I am a soft pitching wedge away from being rock stupid, but still wonder, what could possibly go wrong?

      2. RTTPD

        I once read 9 out 10 Americans have never even held a gold coin in their hands…..

        The first time I held a pre 33 20 dollar gold piece in my hands as a kid, I began to fully understand the true meaning of quality and value.

  6. Bluebellkid

    Nada,
    I posted this on they other thread without realizing Gary had started a new one. Here is IBD’s options play strategy when dealing with companies that are reporting earnings:
    IBD has devised an earnings options strategy so you can reap the rewards of well-received earnings reports from the likes of Netflix and Apple.
    So what is the earnings options strategy? Look for stocks in or near buy zones, usually within proper bases. Then find a just-out-of-the-money weekly or monthly call option, so the strike price is just above the underlying stock price. Every strike price comes with a premium. Divide the premium, or option cost, by the stock price, and multiply by 100. That’s the downside risk as a percentage. You want to look for options trades that will minimize your downside risk to no more than 4%.

        1. Bluebellkid

          A week ago or so someone mentioned HBM was looking good so I checked it out – it has made a nice move the last month. It hails from the Mining-Metals ores group and so I checked out the whole group. There are a number of them that are climbing the right side of cup shaped bases so I put a few on my watch list. Fundamentally I like AA so decided to buy some even though earnings are due this afternoon.

      1. Nada

        That’s a good size play before ER with stock and options. I am wondering if you will utilize puts to hedge a bit? GL with your trade, I will be rooting for you.

        1. Bluebellkid

          No Puts. And I don’t usually do this but the last two earnings reports were good and the stock price has been rising so I suspect smart money has been buying. As I stated fundamentally it is solid. The one thing I would have liked to have seen was more volume the last month as it has gone from 29 to 36.

          1. Bluebellkid

            Alcoa
            Estimates: EPS of 60 cents on revenue of $2.91 billion.
            Actual: EPS of 62 cents on revenue of $2.86 billion.
            Stock: Shares edged up 0.2% t0 36.50. Alcoa is in a consolidation with a 39.88 buy point.
            Alcoa has also been rising on protectionist hopes as the Trump administration mulls curbs of imports on national security grounds.

          2. Nada

            I see it took a hit in AH. You have some time with the options, so hopefully it works out.

          3. Bluebellkid

            That’s my luck. I bailed on NTES and MELI before earnings and they lift off — AA sells off. I will see how it holds up around the 5 day and 10 day if it goes down that much. I didn’t expect a move like the tech stocks but was hoping for a little pop. As I stated there are a number of stocks in the group that are looking good so don’t think this is the end of the move for the group. My biggest concern is the options which as you said have little time to work.

  7. Bigdaddy

    I am pissed. This has not been a good day. SOXS is killing me and although SLV is up some, it doesn’t make up for the draw down with SOXS. Maybe Gary will be right and the market is not going to stop going up in the foreseeable future. Maybe we all need to throw it all into being long the SM.

  8. Don

    Facebook, Microsoft, Amazon, Netflix all made new highs today. Alphabet and Apple are very close. It was just a few weeks ago the analysts were yapping about the possible demise of the market leaders of the past eight years. It’s looking like they got that wrong.

    1. Gary Post author

      It was just a mild intermediate cycle low. Nothing unusual about that. Markets are supposed to correct from time to time. They should be used as buying opportunities.

      The Nasdaq is now starting a new intermediate cycle. It’s only on week 2. I doubt we will get the next INTERMEDIATE degree top until after the Santa Claus rally in December. In fact I’m wondering if we don’t get the bubble top in March just like we did in 2000.

  9. mustang sally

    Good Afternoon,
    Still not buying this rally. it just feels like a set up. Get everybody frothy and out goes the trap door.

    Skeptic Sally

    1. Gary Post author

      All bull markets end in some kind of euphoria phase. If interest rates are kept too low too long and too much liquidity is pushed into the system then the euphoria phase takes the form of a parabolic bubble.

      Unless you thing human nature has changed, why would this time be any different?

      1. mustang sally

        Just have this feeling in my old bones, this market is not the same as before and the results may not be the same , will let my marker tell me, so far not biting.

        MS

        1. Gary Post author

          I’d point out that your marker tried to call a top on Friday. That didn’t pan out.

          People have been trying to call a top for 8 years. The memory of the 2008 crash is still vivid in many investors minds and will be for years to come. They will be looking for the next shoe to drop for many years to come yet. Which is exactly what should drive this market much further than many people can anticipate right now.

          How many people expected a big breakout in the Nasdaq was coming back in 2009. No one.

          1. mustang sally

            Now Gary, the marker is not dead yet, according to breakouts it over 3% which is the buffer, give it time Gary, if it does not come below the marker in short period one should not react to quickly. and as you know not every call is right . is it not what you say.
            Any way a top is hindsight and it has not happened yet.

            MS

      2. AT

        I’m reluctant to get in the stocks trades, as good as reports may sound; Gary equally convinced me after many reports re Gold last fall and I lost on big JNUG 23 trade, and equally convinced me re energy trade (ERX ) … I’m just very afraid now, still in recovery mode, hopefully will recover all loses by the end of the year.

        Who knows how many people will be caught at the top in this crazy market? Is never going only up.

        1. Gary Post author

          We’ve long since recovered from the JNUG trade?

          ERX is not more than 20% of your portfolio. So no big drawdown there while we wait for the intermediate cycle to turn.

          We’re only a little over $3 away from making money on the current ERX trade. We could do that in 2-3 days if we get a recognition day in the energy sector.

          1. AT

            Gary, you are correct, ERX trade should be soon positive. Please note that I would never blame you for my loses.
            I bought too much JNUG at the time, and paying the price. Unfortunately for me, I still have long to recover from that one bad trade. When losing more than half of money, is hard to make it back given there a smaller amount to invest.

            After losing more than 50%, next have to make back more than 100% just to break even.

    2. mustang sally

      I might add that a reversal below 5115 on the ndx would be a place to start a short, if it is a waterfall, I could see 4346 happening. Trigger is waiting , the next 2 days will be very telling.

      Mustang Sally

  10. Bluebellkid

    The Big Picture:
    A look at the top third of IBD’s 33 sectors seems to send this message: Invest in growth.
    The top five sectors are Electronics, Chips, Computer, Leisure and Building (see the entire rankings of 33 sectors by going to the NYSE + Nasdaq stock research tables in the Data Tables section of Stock Lists at Investors.com). They reflect the insatiable demand for data and entertainment, as well as the slow yet steady rebound in consumer spending and home prices.
    It may be enticing to find the bottom in oil stocks, given the nifty 1.5% gain in West Texas Intermediate crude oil prices on the back of a surprise dip in U.S. weekly inventories. However, not everyone can pick the bottom. And share prices in a given sector can remain low for months, if not years. It’s always best to wait for strength to return.
    The Energy sector ranks dead last at No. 33, down 8.6% year-to-date through Tuesday’s close.

  11. zkotpen

    Robert,

    You memorize my forecasts. You get people to answer your questions.

    Your a social ops guy. Is it really worth it to save face over a matter such as me pointing out that the market is perfectly effective and elegant at finding the exact and correct price for all securities, raw materials, and currencies?

    You’d at least have waited until after the FOMC meeting!

    At any rate, I will be willing to accept a heart-felt apology from you.

    Otherwise, you’ll have to try extra hard to make sure you don’t cut off any other sources of free market analysis. I’m surprised that Gary entertains so many of your inquiries. Can’t see him personally attending to you forever.

    As for psychiatric needs — you are the one who thinks the market “should” price securities in ways that accede to your expectations. That’s delusional.

    1. zkotpen

      Robert,

      You should know, with all your social tactics and such, that pile-on is ill-advised. I’m quite surprised.

      You should check out some Gregory Peck movies. Not the film-noir ones, but the other’s: Roman Holiday, To Kill a Mockingbird, Twelve O’Clock High, and last but not least: Gentleman’s Agreement.

  12. Ed

    Two nights in row around 3:30 ÷4;00 some price Insenstive one dumped future contracts met by equally strong bids. Interest to see why there is push down below 1236. These momentum fu%%ers failed twice. Good money to be made if you have a lot of money and can stay wake around 3;45. AM.

  13. Alexandru Popovici

    Bluelagoon, I just closed my long-gold trade at 1237.77 –> gold may make a lower low, ICL may still be ahead of us as USDJPY grows in a dead-cat bounce and EURUSD is to collapse in its DC decline.
    PMs and EUR to be under significant pressure through mid next week.

    1. Alexandru Popovici

      short gold at 1237.5
      swing low in usdjpy and its breaking to new high ground for the day at 112.34 are appetizers for shorting gold.
      then we also have eurjpy having to complete its DC (as ZKOTPEN very well noticed one week ago) below 128.50 and with usdjpy going up that can be done only by having eurusd heavily rolling over, hence USX about to speed up fast!

    2. bluelagoon

      Thanks for the update Alex. Shorter term charts are telling me gold is correcting down but longer term charts tell me it’s going up. I guess we’ll see. I’m not playing gold until I see a good opportunity, especially since Fed is just next week. I think oil and NG are the big movers and it seems like oil has at least completed an ICL.

  14. WYSIWYGN

    @Mustang Sally: you say when NDX goes below 5115 then waterfall to 4346.
    Which levels do these match with on the §COMPX ? (now 6350; see Gary’s chart above)

    1. mustang sally

      Howdy W

      For the comp my first marker is 6230, you can start to short , most only put a modest amount but I like to be aggressive because I would have a stop . Most novice traders put a small amount and get bigger as they get confident, that’s where they get into trouble . It will reverse when you put your biggest amount because you are confident.. If you are right with the marker you won,t get caught. But you need to manage closely at the begiining . My tesla short set up was the same I believe tesla will be one of the leaders down if the markers were right.

      MS

      Comp. target 5333 if initial marker is right

    1. mustang sally

      Mr. W

      For the ndx my initial marker is set at 5731, if it stays above gary could be right about the general market, if it goes below 5731 and stays if may sound the alarm,

      Riden the jdst

      Mustang Sally

  15. Steffmeister

    *** I am on Vacation ***

    A pause from vacation today, found an excellent post about currencies at The Goldtent TA Paradise:

    https://goldtadise.com/?p=407739

    I modified one of the charts, a picture perfect H&S pattern shaping up the coming year ?

    http://farm5.staticflickr.com/4329/35202435734_d23c649eb7_b.jpg

    This corresponds to a rally in stockmarkets, the rally is just an effect of a weakening dollar.

    (posted it first in an older thread)

    1. Gary Post author

      The dollar came within a whisker of tagging the 38% Fibonacci retracement of the entire 3 year cycle. This is why I exited our long position yesterday and I’m now waiting on the sidelines to see what gold does. This level is another possible spot for the dollar to form its YCL.

      If this doesn’t stop the decline then the next one is the 200 week moving average (92ish).

  16. mustang sally

    Tesla/Dusty; Anyone following my foray into shorting tesla will have noticed that it is now backtesting my marker, is it a coincidence the dust back tested my marker the to other day ( 29.30) Today will be the day which shows direction. Above the markers Gary wins, stays below on tesla and above on dusty I win.
    Plain and simple no magic waves

    Make or break day

    Watchin the markers today

    MS

  17. Ed

    EURUSD stopped in track. It is not falling anymore.
    Now there are going to be two trades. One euphoria trade for stocks and bonds. Another safe haven trade for gold. Both will go up. Stocks will go up much faster but greater risk of crash. Make your bets now 🙂

  18. Bluebellkid

    Tesla Stuck In Neutral
    Citigroup analyst Itay Michaeli set a price target on Tesla of 357, saying he is “fundamentally bullish” on Tesla, but that both bull and bear cases for the stock have merit, MarketWatch reported.
    “We’re positive on Tesla’s position as a Car of the Future leader and view the upside case to still be significant, however, we prefer to wait for a better entry point,” he said.
    Michaeli would like to see Tesla have a stronger balance sheet and wants to see signs of a smooth production ramp for its Model 3 car with minimal cannibalization of Model S sales.
    Tesla stock was down a fraction, near 324, in premarket trading on the stock market today

    1. mustang sally

      Good morning Nada: They will fight tooth and nail to keep the usd down, but it is inevitable that the USD will destroy all the holders of loans based in usd dollars. its just a matter of when .

      Ms

      1. Gary Post author

        I think you need to quit reading Armstrong. He’s missed every major turn in every market. He’s going to miss the turn in the currencies as well.

        Socrates is set up to just be a big trend follower. It automatically assumes that the trend in place will continue so it never catches the turn from bull to bear or bear to bull.

        1. mustang sally

          Gary, I you are referring to me, I do not read Armstrong, I do agree with him on world economics and the currency wars, We are run by bankers, they inflate the housing market get the pigs fat with credit and drop the gauntlet , nothing different than countries up to their gills in debt financed by usd. The gauntlet will drop, power is not obtained by war but by debt. That is why the usd will rise. how else do they think they will take country over. I keep telling you this is a paridigm shift from the norm, embrace it or get killed.

          MS

  19. isavage

    Gary the USD did make a perfect 78% retrace from may spike low. Just above your 38 Fib.

    The 78 looks better on my USD/EUR chart for the turn to happen if it’s Gunna 😉

    As you know I’m short NUGT and EUR to capture that outcome.

    Writing now as that Goldman Sacks and BIS criminal agent Draghi speaks we are spiking the wrong way but posablely a fake out move until FOMC

  20. bluelagoon

    I’m looking at XOP charts and it seems to have bottomed across all timeframes. After 7 months of going down, this month it looks like it will end with a green hammer. so I expect next month to at least deliver some upside. For those who play the 3x leveraged – the ticker would be GUSH. I suppose this positive performance would coincide with what we’re finally seeing on ERX. Any other thoughts?

  21. isavage

    Ed Ref COT I agree but already long with full core positions so adding a hedge. I thinking Gary has a chance of that one more tag of the lows before we take off.

    Todays action feeling the oposit, but all week the miner’s have been strangely subdued so running with the hedges until FOMC.

    Surprise rate increase should get everything slowed down before everything gets too carried away 😉

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