Metals and materials

I’ve been thinking about the market and its developments recently and started getting excited about the prospects of precious metals and raw materials. GLD GLNCY UNG USO type stocks. If this rally and base are real, there is some potential for ridiculous profits in the second half of 2016. 

My thinking is I start weighing my portfolio heavily toward Glencore and gold type stocks. Oil and nat gas also looks to be basing up.

Maybe I will invest the first 10k Diana check into metals and materials as tech has not been returning anything significant of late. Perhaps I’m growing impatient? Will meditate on it

Potential Trouble in the Markets

3 DAYS ago the nasdaq put in sell signal confirmation as it broke below the signal day low of 4875.42. Since then the downwar moves have continued with accelerating volume each day. However, the IWM SOXX group is still one or two distr. days away from hitting their signals; the SPY may set its signal day today if the it closes down, which is looking likely now.

The major bright spot has been precious metals. All of them are currently breaking out of their consolidations with solid volume.

Most other market leading sectors like transports and semiconductors are testing the top of falling channel lines they had broken out of. The SOXX and SPX are both retesting top channel lines. IBB is retesting its head and shoulders breakout line. KOL and SLX continue to hold above their 10dmas. UNG big move today on higher volume and pocket pivot off the bottom if rising channel.

Stocks wise, AKS is concerning because it’s down on gigantic volume after announcing a 60mil share sale. This is potentially 33% of its current float. I’m not sure not to respond to this type of thing because its the first time I’ve experienced it. I think I’m waiting to see if this is just a temporary drop and what looks like a huge volume confirmation is just a technical aspect of the share sale. I think I’ll just go by the 7wk rule.

INO tested a huge top channel line’s bottom yesterday and did the typical inverted hammer. Today its down heavily around 7% at 11:20 on heavier volume, but its testing its 10dma and rising channel line support. We’ll see how this one goes too. It’s technically not a 7 wk rule candidate yet because its only been above its 10 for six weeks. But I may move out of it next week as it will technically be six weeks on Tuesday, on into the 7th week starting Wednesday. And a huge run-up.

Weekend Thoughts

Ok. So, after those momentum leader earnings laggards traded today, the S&P500 ended even. The nasdaq ended down almost 1%. BUT the IWC IWM group were up almost 1%!!

We are seeing a possible shift of big money into small cap growth stocks, which tells me risk on. We’ll see if the market holds up and if there is follow thru on small-caps and IBB stocks.

I am also getting some scary signals for gold and materials. Some bigger down volume days occurrd in gold. GLD is riding its all important 50 day MA, as it closed below it on friday. On monday, I’ll be looking for a close below the range of friday to possibly trim my gold holdings.

Silver looks ok especially in the weekly chart. Platinum ETF PPLT however put in a reversal day on high vol but still above the 10 and 50 dmas.

Steel put in a big reversal day on thursday coming down on 3x avg vol. Still above 10 day ma. Individual stocks AKS, appears to be pulling back to the 10 dma.

Glencore is pulling back as well, and on friday pu int in an above average down day. I’ll be happy if it comes down a little bit more to hit my buy order at 4.40.

Major earnings after Thursday’s bell

The three biggest names of this afternoons earnings, Goog, Sbux, Msft all missed and are down around 4% each. This is huge because Goog and Sbux nflx all got hammered. 

Logically this could mean the market takes heed and drops big tomorrow. BUT, if the market turns and rallies anyway, it would be a huge sign of the resilience of the market. We’ll see what happens.

Another interesting note: after schlumberger’s in line but huge reduction in income + super negative comments, oil futures are up at midnight. 

Underneath fundamentally

Any day has the potential to be a wild day, Doha talks, fed meetings. But I’m starting to get a sense that most of it is just noise. There is usually something fundamental going on underneath whether it be institutions that know something or sentiment, policy, or economy driven changes