I exited this trade when the sell/stop was hit at 31.25 on 9-21-15.
I’m going to exit the UWTI position as it’s not developing as it should since the breakout of the small triangle. I’m going sell 1000 shares at the market at 10.63 to close the position. The only position I have open now is the 3 X short natural gas etf DGAZ.
First I would just like to thank everyone for their patience during this unfortunate situation we find ourselves in. Just know everything humanly possible is being done behind the scenes to get Rambus Chartology back up and running better than ever. Rambus
There is a potential pattern taking shape on the daily chart for the GDM that was virtually undetectable until yesterday. After slightly closing above the 50 dma the GDM has been declining back down to the bottom of the recent trading range that began at the August low. I have always viewed this little trading range, at the bottom of the chart, as a halfway point in the decline that began when the H&S / triangle broke down back in June of this year. Last Friday’s high may very well be the start of the 4th reversal point to the downside which won’t be complete until the bottom rail of the potential bearish falling wedge is hit. This is a perfect area for a small consolidation pattern to form. As you know there can be 2 or more individual chart patterns that form a bigger pattern. Originally I was looking at the possible H&S consolidation pattern as the halfway pattern and still is part of the nearly two month trading range.
Below is the 60 minute chart for the GDM we’ve been following very closely during the formation of the H&S consolidation pattern. You can see what looked like a breakout when the price action gapped below the brown shaded S&R zone or neckline. The markets have a way to shake the bush before the original move you were looking for actually gets a chance to take place. The GDM rallied back up to the area of the tops of the left and right shoulders and with one finally gasp it gapped above the right shoulder high putting in an exhaustion gap. Now we have an unbalanced H&S consolidation pattern with one left shoulder and two right shoulders. Keep in mind this small potential trading range is still developing. Also there was a big gap made yesterday that may get tested.
The moment of truth has arrived for SLV as it approaches the brown shaded S&R zone / neckline at 14.70.
The 60 minute chart below shows the GDM running into its first resistance point at the previous left and right shoulder highs at 395. This would be a good place for it to take a little rest. A break above the 395 area would be positive for a run to the top of the potential trading range at 442. First it has to get past the 395 area.
The GDXJ is expanding its new trading range breaking above the center dashed line and has created another double bottom. The top of the trading ranges comes in around the 22.70 area.
I’m going to take another position in LABU which is a 3 X long the biotech sector. I’m going to buy 250 shares at the market at 35.60 and I’m moving the sell/stop up to 31.35.
I’ve adjusted the neckline to the most recent low as the old neckline became obsolete. The next important area of resistance is the bottom black rail of the 5 point bearish falling wedge reversal pattern at 8430. If the transports can trade above the 8430 area the bulls will be talking to us. You can see how it has held resistance 3 times so far on the backtests.
Today the RUT is breaking above the top rail of a potential 5 point bullish rising wedge reversal pattern. All the indicators are looking good as well along with the 20 ema.
The TNA is a 3 X long etf for the $RUT which is showing the same pattern but the volume is very very light. We’ll see what happens after the fed announcement.
