Thursday, June 20, 2013

Boom, Bust...... SILVER and GOLD

Ciao AoT blog readers!

I'm currently in Switzerland for a few days to attend my sister's wedding. I have not been actively tracking charts as closely as i normally would but from my basic scans, i'm seeing a major STANDOUT in my charts and that's the Silver and Gold names. Especially, silver, AoT members know that i have been bearish on Silver for a number of months now and believe that the massive BUBBLE has definitely POPPED(yet another classic boom & bust cycle) that peaked in 2011 is now well gone. As far as i am concerned Silver is not likely see those HIGHS made in 2011 anytime within at least 5-10 years if not more. (recall Nasdaq bubble in 1999-2000).

Next few charts are NEW short setups to watch: Ideally would like to short on "breakdowns" or even on "dead cat" bounces whichis what i will be looking for next few days(weeks). Just keep an eye on these charts. ALL SHORT setups. 

SLV : SHORT SETUP emailed to AoT members only. SLV triggered a short entry late yesterday at $20.75

As a SHORT TERM trader, I only look for opportunities to capitlize on RIGHT NOW so i don't really focus too much on LONG TERM picture although is does help keep things in perspective.  AoT members were emailed the attached seen SLVshort setup this week. I see much lower prices coming in SLV, AGQ, and almost anything that has to do with Silver. Gold is also on the cusp of a major breaking(see technical setup attached). This is setting up in a very bearish pattern and likely headed much lower.

The Updated chart seen below is the WEEKLY Chart of GLD which i have posted many months ago and updated a few times(twitter followers will probably recognize this one).
All technicals are STILL BEARISH in GLD and all signs pointing to MUCH LOWER prices over medium to longer term and even SHORT TERM.

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Monday, June 3, 2013

A "TIME" Based Correction

Hey Folks.

Let's try and make sense of some the chart action we have seen recently. As i pour thru hundreds of charts, i am scratching my head by what i am seeing out there. The ART OF TRADING portfolio came into today sitting on 100% cash as we moved to sidelines last friday morning. On today's weakness we picked up some SSO and MSFT longs for swings. (NOT a recommendation to buy SSO or MSFT).

The NYMO(see charts below: NYMO: an indicator i follow very closely) is slowly but surely getting into areas where 'BIG' bounces have been created. It's getting "OVERSOLD" . So shorting here is a little bit sketchy in my opinion.

However, I am not sure i would give NYMO a total '100% benefit of the doubt' here since the DIA, SPY etc are all rather 'overbought' on several timeframes(including WEEKLY and MONTHLY charts). SPY is up 13% year to date for example and a few days(weeks) of consolidation looks like the MOST likely outcome right now. When The markets are OVERBOUGHT and need to make CORRECTIONS. 
They do this in one of TWO ways: 

1: they either PULLBACK in price and correct overbought conditions in that manner. That's when prices come down and many stocks get hammered lower. 

2: they correct via TIME: that's when the indexes simply chop and churn sideways for a few days(weeks even), bob and weave, annoy the hell out of everyone as BEARS do not get their big pullbacks and BULLS see every rally fail(breakouts fail) and get no upside traction. Both bulls and bears will normally suffer in "TIME" based corrections. 

My SPY60 "ROADMAP" chart is getting into "OVERSOLD" right now so SHORT TERM at least, shorting is a little bit risky right now(potential increase for a bounce of some sort). Between today's move down and friday's nasty selloff, it might be too late to short. So have to be a little bit careful if looking to start SHORTS now. 

My initial reaction after looking thru many charts today, is we are starting a CORRECTION thru TIME, not price. So we need to at minimum expect lots of SIDEWAYS, back and forth churning next few days(possibily weeks). Using TRADING RANGE strategies is what i will be focusing on. Buying on extreme weakness and selling into big gaps ups or strong pushes back into thick resistance areas.

Attached below are charts which i have been highlighting recently on twitter and or NEW charts which are of HIGH INTEREST right now.
Hope this helps and Happy trading to all!

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