102 thoughts on “CHART OF THE DAY – STOCK’S ICL COMPLETE?

  1. Alexandru Popovici

    Gary, yes, indeed ICL. Furthermore, McLellan is an oscillator of Nyse Composite Index which did produce a failed DC !
    Hence we have confirmation of ICL in Nyse, just as in Russell2000 and XLY.
    On the same continuum, COT of Russell is ultra-bullish and with Nyse having its ICH on week 40 and ICL on week 41, a higher high is virtually guaranteed.

    CAUTION: Caution is heeded by Transports – was AUG2 a DCL and then AUG18 the ICL on a merely 12-day DC or do we have a dead cat bounce to bring a higher high for Nyse but not for Transports?!
    Maybe we will have one more failed DC…volumes yesterday were also sub-average!
    Anyway, I am long stocks since yesterday and I’ll see along the way if the caution is warranted or not.

  2. Steffmeister

    What if the tap of funny money has been shut off !? Then it’s only a matter of time before US-index are heading down …

    NIKKEI is the first, maybe SPX is the second one?

    Only time will tell …

    1. Gary Post author

      If that happens then everything would go down just like it did in 2008.

      Why would they all of a sudden allow deflation when they’ve been fighting it for 8 years?

      Doesn’t make any sense.

      1. Steffmeister

        Maybe inflation is picking up? Look at base metals … time to taper and raise interest rates?

        or this is higly unlikely, printing infinite numbers of money is not the most responsible thing to do πŸ™‚

      2. ziasDad

        they’ve been fighting it without much success. they measure success as getting inflation back up to 2 percent and they haven’t done that yet. what if, no matter what they do, we get real deflation anyway?

  3. Pedestrian

    So I am mostly focused on the Euro right now. Waiting to see if it will break down from a multi-month channel on the daily chart. We have maybe one or two more days before it finally decides what direction its going to take.

    Either there will be a further break upwards which means the dollar is going down (positive for gold) or the first of two breakdowns will get underway falling below the lower channel telling is the USD dollar bull market is resuming (bad for gold).

    My lower channel is drawn using the current low points of June and August (which are in perfect parallel with the peaks of May and August). It is this chart that is giving me a headache right now and some festering doubts about the “gold will fall” thesis. If the Euro goes up and stays within its rising channel then my premise is going in the toilet! (For the next while anyway).

    Check the channel for yourself if you are curious how I am getting a read on gold by using a Euro proxy.
    http://finviz.com/futures_charts.ashx?p=d1&t=6E

    You will notice that the euro has mostly traded sideways for all of August even as gold has stayed within a fairly narrow 40 dollar price band. In prior months we have seen gold move within a range closer to 75 dollars average so this month has really been a slow period.

    There are several other charts I use and most are leaving the final verdict on gold open so while I have a bearish bias I can not say for certain what is going to happen next. And that in a nutshell is why I won’t take a trade when gold volatility is low and the potential for a sharp move impending is high.

  4. Pedestrian

    Here’s platinum now. There is a gap to be filled on the monthly chart similar to the gap we saw previously on silver. It’s not that big and could resolve itself on the next cycle down. At that point price would likely bounce of a significant 17 year old support line and we might just be away to the races with a much more bullish outlook on all PM’s. It may even qualify as a double bottom depending on how you read your charts (first bottom in 2015 and the second in 2017)

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

    So run a support line across the bottom of this chart using the low points of 2001 and 2015. This is the most basic kind of charting we can do but it has validity for locating our primary support channel and where the bounce will come in. Can you see that gap in 2017 between the support line and where price currently is at?

    Well if that fills this fall its time to get out the list of your favourite miners and start buying folks. Provided it does not break below the support then platinum will have turned into a very bullish bet for the next while following touchdown.

  5. dboz

    PED , I have to agree. One more small pullback here, possibly another larger one Nov-Dec then we are off after that. Learned patience.

    Wheat 7% bulls after the drop yesterday. Don’t think we will go to the moon, but still expect a really good rapid burst up. The more the rubber band gets stretched…….thanks Gary.

  6. dboz

    Gary, you sure we aren’t looking at May 2016 right here? Possible rise here then bigger flush like June?

    Not that confident yet. Seems too easy.

  7. Jimsee

    crazy town coming over the weekend – u ain’t seen nothing yet imo πŸ™‚ cycles do your stuff.

  8. Gary Post author

    Dr. Copper is not buying the recession talk. Neither are most of the other industrial metals. Earnings are up 20% YoY for the last 3 quarters. That doesn’t sound like a recession to me.

  9. Jimsee

    Gary – it is not a ‘technical’ recession – but whitewashing the income disparity and increasing brittleness of earnings through debt and leverage is not ‘insightful’. Politics is disintegrating, currency wars are evolving to trade wars and we have been printed into hyper-blissful ignorance. danger will robinson.

  10. Goild

    Good morning,

    We may have a good day today, but it is a Wednesday which is often a neutral day.
    Make money today!
    Beware of falling swiftly falling knifes,

    1. Gary Post author

      I don’t see any previous posts were you “projected” anything.

      Enter the challenge and make real time calls or get the boot. You are clearly just trolling for subscribers and as far as I can tell doing it with after the fact trading like almost every other writer in the world. Just like all the rest you have a perfect record, but we only ever hear about it on Monday morning.

    2. Nada

      You asked about hostility the other day? I would not use that word to describe someone questioning the timing of some of your trades. From what I read, you were only “considering” closing your position on USD long – not that you had closed out of your position, and of course you confirmed after the fact, that you sold before the dollar took a dump.

      I like your charts and think its great that you are sharing. What’s not so great and in poor taste, is that you are trying to mine subscribers on another individuals blog.

  11. chrisG

    I differ from gary. SPX is at least going to test the 200 dma before oct ends, before any chances of a bubble rally.

  12. MegaMind

    I am very bearish the stock market…my assumption is that it will drop 25%… any else have the same calculation… ofcourse it will go to 20000 like gary says BUT only after a bloodbath…

  13. jacob2

    September not the season of big rallies. It is tax loss selling time for institutions, weak get weaker which drags the rest of the market along with it.

  14. Jimsee

    Goild – if u want up – root for it to go sideways till Monday – 1-2 times a year it gets this excitign in my work – a banker hot air cloud formation layered on a cycle – yum yum. a dull late aug – late sep is unlikely imo.

  15. Pedestrian

    Regarding the Jackson Hole Conference, Zerohedge writes ” The main events start Friday morning at 10am (Mountain Time) with the keynote speech, which we now know will be delivered by Fed Chair Yellen and……ECB President Draghi will deliver the luncheon address on Friday at 3pm NY time.

    Of course, 3pm is just before market close so it may be a good time to focus on your trades late day should his remarks be negative for the euro and by inference a deflator of gold. While nobody knows what will be said, in the past the Symposium has offered clues about Central Bank policy going forward and surprises can never be ruled out entirely.

    1. Andy

      WEAT issues a K-1 for tax purposes…not something I want to deal with as you can get stuck with a large tax burden if the fund distributes while you hold it. I was going to buy call options instead but the spreads are ridiculous

    2. Pedestrian

      I didn’t buy. When WEAT opened it fell lower so decided to hold until I had time to read the prospectus for an explanation of how the fund works. It is not following futures very closely though since they went in opposite directions.

  16. dboz

    I had a killer overnight trade on TVIX. Bought after hours last night for 16.48, sold at the open for 18.20. Took balls but it paid off. Just 1000 shares, but still, nice quickie.

      1. dboz

        Yeah, I know. It does sound fishy. If I was not killing in the competition I would have done it there but no sense to risk it IMO.

  17. Spanky

    Right now given how messy the candles on the daily GDX look, my guess is yellen will send the miners lower into a dcl. Again, based on then ugly candles I feel like most if not all of the gains off the July bottom will be given back. That being said I am holding onto my miners through this daily cycle. I hope I am wrong. I would certainly not be unhappy if we just rocketed higher this week and never looked back, but I don’t think that is very realistic. Another possibility is a pop off of Yellen’s speech and then a reversal sometime next week that begins the descent into a dcl.

  18. Pedestrian

    I knew it! Now the US Navy is investigating the four collisions of its Pacific Fleet ships this year on the basis that they were hacked or interfered with by a foreign nation. Up to a million counterfeit Chinese electronic parts are riddled throughout the fleet and back-doors may have been inserted into the ships electronic systems starting many years ago. And get this, I read elsewhere some of those vessels are running on windows FFS! Sounds like its time for an overhaul. How in hell can you intimidate your adversary if you can’t even clothe your marines in outfits that don’t say “Made in China” on the tags.
    http://www.zerohedge.com/news/2017-08-23/chief-naval-operations-looking-possibility-ships-were-hacked

    1. dboz

      I thought the same thing. Even scarier is, why is NO ONE watching out for lights?! Just running on instruments only. Hell a drone could be messing with the electronics. Just seems very hard to get rammed by a GIANT ship? Even worse, what good are those things if they can’t even spot freighters. A SUB could just sneak right in.

      1. Pedestrian

        An even crazier explanation is the Navy might be angling for a budget increase by crashing ships and then blaming Chinese hackers. What I don’t get is how the treasury will convince the Chinese to buy more US debt issues when its likely known its going to be used for military expansion.

    2. vin

      This truly is scary! How can they? It is about time that China be treated for what it really is.

      We can thank Henry Kissinger for this mess.

      When I look around I only see “made in China” everywhere. But, I did not think that even the military essentials depended on China. How can they? Really! It is mind boggling!

      All they had to do was read Chinese history.

      1. Pedestrian

        Guess that’s what happens when you offshore all your manufacturing to a future competitor and then put all your own people to sleep in the service industry or as baristas. So few seem to understand that wealth is created by manufactures. Real goods produced by labour are equal or better than money because goods ARE the very foundation of money. The s of bitpaper in your wallet are just a handy means by which we transact in production items of real value. Of course that does make me a goldbug at heart since we all agree here that gold is a genuine store of wealth whereas paper dollars are an item that must be worked continuously lest it lose most of its value over time. The only way production is coming back to the developed world though is if labour costs crash or most of it is done by robotics. I think we will get some of both before the final chapters of this story are written.

          1. Pedestrian

            Going down Vin. Don’t buy it here. Copper could be just a few cents away from the start of a price reversal. Currently trading 2.99 spot per pound which is the highest price we have seen since 2014. But don’t buy all the bullish talk quite yet and especially if anyone starts saying Dr Copper proves the economy is firing on all cylinders. Copper is heavily speculated on in Asia these days and when it drops the same casino mentality that drove it up in the first place will also crash the bid on the way down. It has come up against strong technical resistance and may reverse at any time now so use caution and check your charts before getting long.

  19. Gary Post author

    I think this probably just boils down to the triangle in the semi’s. They have been leading this phase of the bull. If the upper trend line breaks then we’re off to the races and the vertical phase of the bubble has begun.

      1. Pedestrian

        Looks like a bottom in ERX. If its anything significant the implication is the dollar will weaken and fall lower.

        1. Pedestrian

          Sorry, I take that back. Looks like a minor relief bounce. The ERX chart is terrible viewed on a long term basis and will probably test back below 15 given more time. Glad I didn’t buy it. What a disaster.

        1. Pedestrian

          It’s fallen three weeks in a row. How can this tiny 2% move up get you back to even let alone the green?

          1. Christian

            It’s called “cost average down” buddy — look it up!

            I keep telling everyone.. Don’t ever sell in a panic because there is always a BOUNCE UP of some form.

            Ps: Oh and I posted my first ERX trade in real time on this blog last week when I told everyone that the 15 minute chart was over-extended. And I bought some more around $22.25 πŸ™‚

          2. Pedestrian

            Oh right, I just remembered you weren’t one of the guys who bought a few months back and held on all the way down. This is a new trade for you. The chart still stinks other than a short term bounce though. At an eyeball guess it gets to 26 and change.

          3. Nada

            Tell that to the JNUG 23 folks. They have been using the principles of “cost average down” since Sept of 2016 with no luck πŸ™‚

  20. JJHarmen

    I was looking at ERX on the charts. It has a long ways to go to get back up to $30. It would be a nice win if it did from anyone buying now.

  21. Goild

    Well, pocketed $933 on the swing account and $396 on the cash account.
    I am done for today.
    Make big bucks!

  22. Alexandru Popovici

    Yes, it’s a dead cat bounce in stocks – Transports clearly show it now as I was fearing: they move lower on day 15; they look decided to break below the May ICL in this DC to confirm the YC decline.
    All stock market should follow transports shortly too.

  23. bginvestor

    Reading some morning threads, some of you are thinking that 20 to 25% correction is about right before a jump back up to maybe bubble conditions..

    That’s some serious technical damage.. Why do you guys think a bubble is still possible after that amount of correction? Is there a previous example?

  24. dboz

    I think I am the ONLY ONE who has purchased WEAT, but we moved up to 10% bulls today. Possible 6.40 bottom? At 6.42 still think it is a great risk/reward even with a tight stop of say 6.35. It either goes up or you are OUT with almost ZERO damage. Can’t get much easier than that? RUBBER BAND is stretched really far here.

      1. dboz

        Still waiting for a killer setup coming for teh contest, have to remain patient for now. May have taken a hit today by buying DUST. If we don’t see a drop in miners tomorrow, may be starting to get FOMO.

        1. Nada

          dboz,

          Simple. Just wait 1 day before the contest ends and enter a position. Everyone else will have blown up their account πŸ™‚

        2. Nada

          I think you will be OK in DUST. I still think we see another pop in gold before the DCL, but miners are most likely done until we get a correction. I did notice 163m outflows in GDX if that helps you sleep better tonight. Also there was a very large BOW for SPY.. drumroll please.. 657m. With that said, its always scary shorting gold with little Kim Jung Un out and about ordering new missile parts.

          If the SPY is red in the morning. by that puppy with 100% of your portfolio in SPY itm calls that expire Friday πŸ˜›

  25. butch

    I bought more gold and silver options today. My target for the dollar is 88.70. Be greedy when others are fearful. “Warren Buffet”

  26. Andy

    For those of you interested in junior miners….check out Atlantic Gold Corp. They are set to for their first gold pour on September 1st (yes next week). Market cap around $200 mill, but their All-in sustaining costs (AISC) is only $530 per oz. Set to produce roughly 90 million oz per year base case, but recently drilled out a second resource and aim to increase production goal to between 150 – 250 million oz per year. They are mining in Nova Scotia, and Canadian miners usually get a big premium valuation as opposed to African or South American miners…

    Doesn’t take a rocket scientist to figure out that they are only valued at 3.5 times cash flow for base case, and just over 1 times annual cash flow if you pick the mid range production target…..most peers trade at 6 x annual cash flow. Management owns 35% of the company and are still actively buying shares on the open market.

    Full disclosure I have started a position and will be adding as we go up.

    http://www.atlanticgoldcorporation.com/

    1. Andy

      their annual production should read 90 THOUSAND oz….not million of course. Target will be 150 – 250 THOUSAND oz….my bad.

  27. Goild

    Got rid of my 1K GDXJ shares.
    I did not like how it was lagging GDX today.
    The manipulators exert maximum pain and drag the utmost before allowing the miners to go up.
    Yesterday they pulled the trick of dropping the price at the close, opened today higher, faded a drop toward the close, to only let the miners go up at the very last.
    Well it was another day and tomorrow we need to keep making money.

  28. Goild

    Dboz,

    On this WEAT thing.

    It will continue falling.
    If I were to get in, it would be when the departure from the averages would be similar to the peak near 7/3.
    Volume has to peak to show fear.
    The WEAT things might be a family fund which can sink to cents.
    Good luck.

  29. zkotpen

    At the daily cycle degree, DXY and EURUSD are NOT correlated to gold:

    Correlation coefficients:

    DXY:gold: -0.16 (not correlated)

    EURUSD:gold: +0.19 (not correlated)

  30. Goild

    Dboz,

    In addition, assume it is near the low, where would the fuel to make it go up come from?
    If it valuated at $6.42 it is because it is what it is worth.
    Volume today was at about 219344 shares, take a 1K shares trade, and there are about 219 players.
    The bandwagon will take a long time to get some people on board.

    The swing high on 7/3 reminds me of the old BTU. A nice trick the insiders perhaps played to get the most of the shares before going bankrupt.

  31. Goild

    The miners coil may not resolve into a breakout or breakdown but in a tight channel till December.
    If so we are going down shortly for a cycle low early next week.

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