• CDE - Jun 27 201420140627
  • $CDNX - Apr 03 201420140403
  • CORN - Jul 28 201420140728
  • GDX - Jul 31 201420140731
  • GDXJ - Jul 31 201420140731
  • GLD - Jul 31 201420140731
  • NSL - Oct 02 201320131002
  • $SILV ER - Jul 31 201420140731
  • SLV - Jul 31 201420140731
  • WEAT - Jul 25 201420140725
  • XVX.TO - Apr 03 201420140403


Long Setups

Long Setups are stocks or ETFs that are in a bullish technical pattern formation that are poised to break-out and provide an objective long entry. This category may also include stocks that have already triggered a entry but still offer an objective entry or add-on, such as a during a pullback to support.

Jul 312014
 
SLV 120 minute chart

SLV 120 minute chart

As a follow-up to the previous 120-minute chart on GLD, this is the 120-minute chart of SLV (Silver ETF) showing two key support levels, the first of which is not far below current levels. The S1 & S2 support levels (1st & 2nd support) are defined by the large gap from June 19th as well as several previous reaction lows & high on the silver ETF. Although I had not drawn the similar uptrend line on the previous posted 120-minute GLD chart as is shown on this 120-minute SLV chart, GLD did also recently experience a breakdown (and backtest) of a similar uptrend line also following a divergent high & extreme near-term overbought conditions. (I also pointed out that comparable uptrend line break on the 60 minute GDX chart towards the end of yesterday’s video).

Those breakdowns, especially following the divergent highs & overbought conditions, were unarguably bearish technical events and as such, prices have moved lower since. With that, I’d imagine that bearish sentiment on the metals & miners ramped up considerable in the last few days in addition to a flurry of selling (by both longs & shorts) in GLD, SLV & the miners.

If a new cyclical bull market in gold & silver is indeed underway, then my expectation would be to see this current downtrend in the metals & miners reverse at or quite possibly before the lower support levels shown on these 120-minute charts. Should GLD & SLV reverse shy of those support levels and relatively quickly go on to take out the recent July 10th reaction highs, I would view that as very bullish price action, with the next & final key resistance area (which would trigger a powerful longer-term buy signal) being the March 13th & Feb 24th highs in GLD & SLV (respectively).

Jul 312014
 
GLD 2 hour July 31st

GLD 2 hour July 31st

I have decided to start adding back exposure to gold and the mining sector as GLD has fallen to a fairly solid support level while at the bottom of a bullish falling wedge pattern, as shown on this 120 minute chart. Although GDX remains near the bottom of its month-old trading range, as I often state, the miners will ultimately follow the shiny metal.

As I continue to remain longer-term bullish on gold & expect pullbacks to be relatively shallow (assuming a new bull market is underway), a long entry on GLD and/or the miners here with the appropriate stops below looks to be the first objective entry that I’ve seen since removing my exposure to the mining sector in my trading account just over a month ago. A relatively tight stop can be placed somewhat below the 123 support level (to provide a small margin of error to allow for a brief overshoot) while a more liberal stop (my preference) would be to continue to scale into GLD and/or the miners if GLD continues down to that next support level that comes in around 119.50, with a stop somewhat below that level.

Jul 282014
 

CORN (Corn ETF) offers a somewhat aggressive entry here on the break above this 60 minute bullish falling wedge pattern. CORN will also offer a second objective entry or add-on to an existing position taken here if & when prices move solidly (5 cents+) above the top of the July 21st gap (26.67). I refer to this current entry as somewhat aggressive for two reasons: First, that July 21st sizable gap is not too far overhead. Gaps, particularly large gaps, often act as support & resistance, especially on the initial tests of those gaps following their creation. Therefore, taking a long-side breakout in relatively close proximity to resistance may limit the upside potential on this trade, should prices ultimately fail to surmount the 26.67 level.

The other reason that an entry here is somewhat aggressive is due to the fact that CORN might go on to backtest this 60 minute falling wedge at lower levels. As the weekly chart below highlights, $CORN (spot corn price) has been in a very powerful downtrend (actually, a third reason this is an aggressive entry) and is currently trading in what I call No-man’s Land, which is when a stock is trading in an area well above & well below any decent support and resistance levels. When trading these “catch a falling knife” trades, where a stock is in free-fall mode yet I believe a powerful trend reversal is imminent, I prefer the stock to be approaching a key support level on the weekly chart while setting up in a bullish chart formation on the daily and/or intraday charts. In the case of $CORN, the next solid support level (340ish) is about 8% below current levels.

With that being said, I still see enough potential for a possible trend reversal from current levels to initiate a starter position in CORN (CORN ETF). An ideal scenario in the upcoming days would be a gap above the top of the July 21st gap (26.67), to put in place an Island Cluster Reversal bottom, with the “island cluster” being the group of candlesticks that were formed over the last week or so. That would be a very bullish technical event & one in which I would bring CORN to a fully position. As of now, my plan is to establish a partial position on the breakout of this 60 minute falling wedge, adding if and only if price move above the top of that July 21st gap (by at least 5 cents, to help avoid a false breakout). I plan to use a stop below 25.60 in case $CORN does want to go on to test that 340 weekly support level.

CORN is being added a both a typically swing trade entry & setup as well as a Long-Term Trade Idea & Setup, as this trade is based largely off the weekly time frame and has the potential to morph into a long-term trend trade with additional targets likely to be added, should we get some decent technical evidence of a likely trend reversal in the upcoming weeks. Long-term traders & investors might consider a wider stop that that suggested above for typical swing traders. A stop somewhat below the 340 level on the $CORN weekly chart would still provide an attractive R/R if target the top of the R2 zone which comes in around 550.

Jul 252014
 
WEAT daily July 25th

WEAT daily July 25th

WEAT (Wheat ETF) will trigger a long entry on a break above this steep downtrend line. For a large part, commodities have been my bread & butter so far this year (pun intended) with a long-side trade on WEAT earlier this year (not posted on the site) following the break above that previous downtrend line as well some very lucrative trades in the miners, catching the bulk of both of the major rips in the gold & silver mining stocks this year (which are once again starting to look interesting as the pullback/consolidation that I was looking for to help work off off the recent divergences & overbought conditions may be complete…more on the miners soon).  Copper, including the Copper ETF, JJC, may also be setting up for a nice long-side swing trade (thanks for bringing that to my attention B.G.) in addition to some other commodities as well.

Stops on WEAT should be dependent on one’s preferred price target(s) although a relatively tight stop, should WEAT breakout soon, could be placed slightly below the recent lows. There’s also a good chance that I may adjust the price targets depending on the chart of $WHEAT (spot wheat prices). Additional profit targets may be added as well.

click here to view the live, annotated chart of WEAT

Jun 272014
 
CDE daily June 27th

CDE daily June 27th

CDE (Coeur Mining) could offer an objective long entry on a break above the downtrend line although it may or may not need one more thrust back down inside the pattern. Although currently overbought with an RSI reading of 72.76, the stock made considerable gains after reaching that level in late 2013 following an oversold reading similar to the most recent one. If a breakout occurs soon, best to take only a partial position, adding on the next decent pullback assuming the charts still look constructive.

click here to view the live, annotated daily chart of CDE

Jun 242014
 

The first chart below is the 60 minute chart of GDX posted yesterday in which I listed my pullback targets. As GDX was still solidly entrenched in an uptrend at the time, I had placed the top of Fibonacci retracement at the top prices at that time, figuring that a near-term top wasn’t far away. As such, the key retracement levels that I am currently targeting, the 38.2% & 50% levels, came in just below horizontal support levels on that chart. Following the marginal new highs put in following today’s gap higher in GDX, I have adjusted the Fibs to reflect what I now feel more confident to be the near-term top in the gold miners that I was looking for and as you can see in the second chart below, today’s updated 60 minute GDX chart, those key Fib retracement levels of 38.25 & 50% now come in right at horizontal support levels, something that I look for to provide additional validation for a support level and/or price target. The third chart is a daily chart of GDXJ (Junior Gold Miners ETF) with some likely pullback targets, the first of which being Thursday’s gap which triggered the impulsive breakout above the primary downtrend just as with GDX, GLD, $GOLD, etc…

I wish that I could say that I had a strong preference for which support level is likely to be the final one hit, assuming of course that I’m even correct about a short-term top being put in place at this morning’s highs. I will say that I am leaning towards a pullback to the S3 level on GDX, which comes in around 24.80, but I wouldn’t be surprised to see GDX find support & go on to make new highs from any of these levels. Should GDX continue lower to find support at only the first or second support levels (S1 or S2) before moving sharply higher, that would indicate a very strong bid underneath the mining stocks and bode well for the intermediate outlook for the sector. As usually, my plan will be to gradually & systematically add back the exposure to the mining sector that I recently reduced as my profit targets were hit over the last week, focusing on the technicals of both the sectors (GDX, SIL, GDXJ, etc…), the metals (GLD, SLV, $GOLD, etc..) and of course, any specific individual mining stocks that I plan to trade or recycle back into after booking profits.

 

Apr 032014
 

XVX.TO is an Active Long & Long-term Trade idea that was first added as a setup on Jan 17th (click here to view the previous notes if interested in this trade). Since that last post, the $CNDX (TSX Venture Composite Index) did go on to trigger an entry on the trade by clearing the 980 resistance level. From there, the exchange gained about 7% before coming back in to make a successful backtest of the 980 level (resistance, once broken, becomes support). All-in-all, the price action on the $CNDX remains constructive and with prices still trading above but close to that 980 support level, still offers an objective entry or add-on for a long-term trade or investment in the XVX.TO.  To reiterate, my preference is to use the $CNDX chart for timing entries & exits in the XVX.TO. Updated daily charts below.

$CDNX daily April 3rd

$CDNX daily April 3rd

XVX.TO daily April 3rd

XVX.TO daily April 3rd

 

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