The Miners Trading system

The signal is the same, long DUST, however, the original signal was on the open of 9/6 @$29.72. As the system has been designed and tested, there is a 3% stop-loss built in, which would give you a closing stop of $28.83. Today DUST closed at $28.45 which is below our 3% stop-loss, which would mean that you would sell DUST on the open tomorrow morning, even though the actual signal is still long DUST.

GLD/Gold has been a safe haven trade when the market falls and we have been in what I believe to be a bottoming formation, which means it has been choppy trading.

 Here's tonight's continued long DUST signal...

 This is the SPY in green vs GLD in white. You can see it's been very difficult to hold any kind of swing or trending trade. There are a few moments when GLD and the market have moved together rather then the typical inverse correlation.

 As I have been saying though and this is a hint toward my market perspective, DUST has been building a solid base on a 60 min chart, wait until you compare it to NUGT/GDX. Since it seems DUST has a tendency toward an inverse relationship with GLD, the fact we are seeing such a long and apparently strong underlying condition in the base, hints to me that the market rise I've been anticipating (after we get a decent drop and I believe this month), is probably on track. The market rises, GLD falls and DUST with its largely inverse correlation rises.

 Even the 15 min chart of DUST shows strong 3C positive divergences in the underlying action.

 This is a 1 min chart of DUST with a late day positive divergence, so you may get a better price on the open and we may see a gap up that I hinted at with a few late day market divergences. I'll show you a Trend Channel chart of reversals at the end of this.

 In contrast, NUGT's 60 min chart is going the opposite direction with a 3C negative leading divergence.. Remember, these are longer term trends represented by the 60 min hart and we are still in a choppy market. Furthermore, last month I questioned whether the typical correlations we have grown use to seeing are going to change.

 Here's NUGT on a 15 min chart, again lagging in a negative divergence.

 As well as on the 10 min chart

And the end of day 1 min chart looks the exact opposite of DUST.

Now, this chart is more market related, but has to do with reversals which I often say, are a process, rarely an event.

Take a look at the SPY with my Trend Channel

This channel was designed to hold trending trades on a daily basis, but because the market has been so choppy, I have to set it to a shorter 30 min timeframe. When price crosses below the lower channel during an uptrend, it signals the end of the trend. However, as  say it's a process, note at the red arrows when price first crossed below the channel and in the white box, some extra time before the market reverses down. In each of these cases, the stop signal came and 1 day passed after the stop signal and then the market reversed down.

Perhaps we do get a gap up and lateral trade tomorrow after the President's speech tonight. One thing is for sure though, the 5, 10 and 15 min charts are in some of the worst shape they have been in since we started this consolidation so I'm holding my short positions gap or no gap up.

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The depth and scale of the market's problem

Remember that the longer the chart, the more important and 10 min is where we see a lot of institutional activity.

Not only did the 10 min DIA go negative at today's intraday highs-Wall Street selling in to strength-, look at the leading negative divergence created in just half a day, and then compare that with the same 3C levels in the past-YOU CAN'T, today the leading negative divergence is the deepest we can see on this chart, even when prices where lower on 9/6.

Notice Anything

 The Euro around 3:10 and 3:30

The SPY around 3:10 and 3:30

Don't Forget, the Prez Speaks Tonight

He might say something that gaps the market up in the a.m.

Here are the only two charts I can find that really show any 1 min positive divergence which could be market makers getting ready or accumulating a small position for a possible gap opening tomorrow.

In the larger scheme of things, the 5, 10 and 15 min charts are so far gone now that I can't imagine any gap up would be anything worse then what we saw today, followed by more downside.

 DIA has a small positive 1 min divergence

As do the Q's, I'll keep watching, although these could simply be signs of a consolidation or a correction.

Like I said, the longer charts are shot and they matter more.

There goes GLD

Today's earlier update

As you can see from the update, we've had some nice advance warning for GLD

A Few Inverse ETFs

These are the more important longer term charts on several Inverse ETFS I have mentioned over the days (short the underlying and leveraged).

 BGZ 10 min

 EDZ 10 min at  a new leading positive high

 FAZ 5 min at a new leading positive high

 FAZ 10 min at a new leading positive high

 SDOW 10 min

 SPXU 5 min at a new leading positive high

 SPXU 10 min

 SRS 5 min

 SRTY 10 min nearly at a new leading high

 The same with SRTY 15 min!

TZA 15 min near a new leading high!

The Euro

I think to the extent that there's short term support for the market, it is coming from the Euro...

 The red arrow is the Bernanke speech, the green arrow is a pullback in the Euro, which sends the dollar lower and gives the market some support, of course we are looking at a very small slice of the action and not a significant pullback here.

 FXE-The Euro trust has a 1 min positive divergence, so it could provide some temporary support in the market.

 However, the bigger news is the longer term Euro/FXE charts. You may remember yesterday we had positive divergences in the FXE in all the short timeframes and it concerned me, "How can the market fall with the dollar weak and the Euro showing more strength?" Well those have completely disappeared today! This is the 5 min.

And the 10 min!

It looks like the question answered itself.

Dow Support Level

I haven't had a chance to look at the rest of the averages, but the DOW/DIA is hitting multiple support levels and the action is getting interesting.

 DIA multiple support levels right here...

 This is a 1 min positive divergence, presumably because of the support levels, but before I could capture all the charts, it has turned down.

 The DIA 15 min chart in a negative leading divergence, for new members it may not seem that important, but this is a very important timeframe and it is seeing the worst type of divergence there is

 SPY 10 min leading negative

 QQQ 5 min leading negative hitting new lows for the past 7 trading days, even when price was much lower.

 IWM hitting new leading lows on a 5 min for at least 7 days

 IWM 10 min moving toward new lows , with most of the damage today.

IWM 15 min leading negative starting today...

Looks like the Euro didn't care for it either

Exactly at 1:30

Even the currency traders are a fast read.

The market was waiting for Bernanke's comments

The speech was released from embargo at 1:30... look at the SPY chart

The market started to drop on high volume at exactly 1:30

Boy, someone reads speeches REALLY FAST. Or Perhaps an embargoed speech just happened to slip in to someone's hands on Wall Street, thus the acton this morning... Maybe setting up a nice bulltrap?

It's happened before.

Here's our answer

Bernanke's speech was just released from embargo...

Here's the text

Ironic...

The second I published the last post, I had about 20 alerts go off as the market moved down on some substantial volume.

Market Intraday Consolidation

 You can see the market has been flat since 12:00 , there are some 1 min 3C negative divergences, I thought maybe we'd see a flag of some sort, but just pure flat.

 The SPY 10 min chart is really moving though, look at the leading negative divergence from just today alone. As I mentioned in some unrelated posts, accumulation and distribution often occur in to flat trading ranges. It appears that distribution is picking up, which can also be interpreted a short selling as both act are selling.

Usually the TICK chart will trend with the market and here it is trending sideways, however, there are some huge swings from +1000 to -1500

ROYL Update/Chart Request

ROYL is another that looks similar to UNG, although the volume is MUCH lower.

 This is the daily 3C chart with another leading positive divergence like UNG, like UNG ROYL also seems to be in a lateral base, this is how long term accumulation most often occurs-quietly. This base s probably a little more advanced and I wouldn't be surprised to see ROYL make a decent move up within the next few weeks.

 The 60 min chart shows when prices rise to high, there's a bit of distribution to bring them back in to the target accumulation area.

 We see the same on the 30 min. chart.

 The 10 min chart accumulated on 9/2-9/6 and moved up from there, right now it looks like there's some light distribution of that move up.

The same can be seen on the 5 min chart, there's not enough volume to see much on a 1 min chart. Again, if I had any profit in this from the 9/7 move up, I would consider taking some or at least have a trailing or regular stop in place. Again, I think it will be difficult for these energy stocks to mov against the sector which I believe will see down side moving forward for several days.