Trading was fairly uneventful today for this trader. Scalps were taken in NVDA and CROX for lunch money. I’ve been watching the gold and oil stocks on their bounce though. It’s been a while since oil stocks have put on a rally. A few profits were taken from CLB and ATI this week, but looks like now both sectors have come up against their first level of resistance.
ECA, MRO, and VLO in the oil sector, and AEM, GG, GLG, and AUY in the gold sector, have reached their simple 20-day moving averages and stopped. These stocks are all on my watchlist. Is this a dead cat bounce, or do we have a bottom forming in commodities? One way to play the sectors is by trading the OIH Holdr (Oil Services), or GDX (Gold stock) ETF shown in the charts.
I have no clue what these stocks will do from here, but I’ll be watching for potential setups. They’re either going to pull back, base, or continue higher quickly. I wouldn’t discount a little short squeeze if they do continue higher quickly. Pure speculation.
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I expect sideways trading for a while, but hope we can hold and base above $600 gold and 300 HUI through the elections. Knowing how this market moves, it should be a very rapid rise when it finally gets its legs back, so I am holding a core position. I will add on either a breakdown or breakout. The upside potential is much greater than the downside risk, in my opinion.
Nice site and tech analysis.
Hi Jason,
Thanks. Sideways action is definitely needed after the damage done recently. I agree. When these stocks get going, they can really move.
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