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Testing the Metal of GLD, SLV, GDX


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#1 thoughtpwr

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Posted 30 August 2016 - 04:57 PM

Today's metal selloff (which didn't seem to hurt SLV much) has placed the metal complex at the key point for potentially a very sudden down move from GLD 125 to GLD 121 during the next several sessions. This will fill the gap that occurred on Brexit. If we reach that mark, I expect a furious rally to ensue that takes back most of that loss and gets back to 127 before pausing and giving back half of that gain. I have removed my call portion of the SLV straddle and added GLD 127 puts yesterday. If we go down that far, I will scale into long October call positions between market prints of 121-122.8. I will also try to establish a bull put spread at 115/114. 

 

Although SLV seemed to have relative strength today, silver stocks like CDE, ended with a bearish five day continuation pattern (falling three methods) on the candles at the low for the 5 day period. One could argue the metal did the same in a slightly distorted form. I am looking for SLV to reach 16 or 16.5 in a down draft.

 

Thursday is the New Moon buy day and Bernstein seasonal buys get exercised on the close of 9/2 for SLV, 9/4 & 9/6 for GLD, as well as 9/4 for USO. I also noted a WEAT buy for 8/26, 8/30, & 9/2 IF you can stomach the downward pressure in that market. The moves down on the first two dates have been significant. WEAT has spent the last four days outside the Bollinger bands, but can you really expect to rally out that deep oversold position quickly? If I take a position, it will be a small one.

 

I am sure all of this depends on the strength of the $USD, which looks to have resistance at both 96.5 after closing at 96 today and also at 97.6. It cleared resistance at 95.95 today. I would assume the stopping point for the dollar is where GLD will stop dropping, which will be inferred from the jobs report on Friday and these two resistance levels. After falling out of a narrow channel it started last Tues, it jumped back into its channel extension over the last couple of days and if it continues to move in this manner, it can reach 96.5 by COB Wed and 97 by COB Thurs. If so, I would expect a jump on Friday AM to 97.5 where we might see GLD take back the losses for the week. 

 

Good hunting, but be nimble here.


Edited by thoughtpwr, 30 August 2016 - 05:00 PM.


#2 SilentOne

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Posted 30 August 2016 - 08:45 PM

If you study intermediate tops in bull PM bull markets, corrections typically run 7-9 weeks. That would be the minimum IMO here if we find a low on a continued decline. With such a smart move up here this year, it will take some consolidation before we see another strong leg up.
cheers,
john
"By the Law of Periodical Repetition, everything which has happened once must happen again and again and again-and not capriciously, but at regular periods, and each thing in its own period, not another's, and each obeying its own law ..." - Mark Twain

#3 K Wave

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Posted 31 August 2016 - 09:41 AM

As I said many weeks ago....we might see a 2 week pop above 1310 (which is exactly what we saw on Brexit), but that Gold is basically dead money for the next 9 months to a year.

 

If bears reclaim 1310, then we likely see low 1200s, or possibly 11 handles briefly, sometime over next few months, which would be a good re-entry point for long term positions IMO....

 

So far, exhibiting classic early bull market action...just need to finish out the launch pad now before what could be very big move upside over next 3-5 years....


The strength of Government lies in the people's ignorance, and the Government knows this, and will therefore always oppose true enlightenment. - Leo Tolstoy

 

 


#4 tommyt

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Posted 31 August 2016 - 10:26 AM

thoughtpwr, I wonder why NUGT split? I dont like when these things go under $20. They are trading vehicles and move nicely point wise when priced $40-$100. It may have to reverse split again LOL.



#5 thoughtpwr

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Posted 31 August 2016 - 01:38 PM

Wednesday, today, $USD has tested from the topside 95.95 and is rallying off of that level, which should point to more weakness in the metals and USO. Today, USO has taken a beating and another day like today and its momentum is shot and is headed for new lows in the short term.

 

While the dollar has struggled and tested its first breakout area, the metals, in particular both GLD and GDX have been unable to regain key support, which was suspected to become resistance. With resistance established I expect a major selling yet today and tomorrow. 

 

I was in error in stating that the New Moon was a buy, it is normally a sell. However, I have been interpreting the reversal of highs and lows from the Full Buy failing to mean that it will be a buy. This has yet to be seen and I have to play it honestly as to whether it sells off or moves higher. I have assumed it will be a buy given the large number of seasonal buys in the metals that start on close of business for 9/2, 9/4 (becomes 9/5), 9/6.